Document:

Exhibit 10.10

 

Execution Copy

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) between APREA THERAPEUTICS, INC., a Delaware corporation (the “Company”), and Scott M. Coiante (the “Executive”), is made and entered into as of September 26, 2019, and will become effective, if at all, upon the date of closing of the Company’s initial public offering of stock pursuant to an effective registration statement filed under the Securities Act of 1933, as amended (the “Effective Date”).

 

WHEREAS, the Company desires to continue to employ Executive on the terms and conditions contained herein;

 

WHEREAS, the Company and Executive previously entered into an employment letter agreement, dated as of August 5, 2019 (the “Prior Agreement”);

 

WHEREAS, Executive desires to continue to be employed by and render services to the Company upon and subject to the terms, conditions and other provisions set forth herein.

 

NOW THEREFORE, in consideration of the promises and mutual covenants and agreements contained herein, the adequacy of all of which consideration is hereby acknowledged, the parties hereby agree as follows:

 

1.                                      Agreement and Term.   The Company hereby agrees to continue to employ Executive, and Executive hereby accepts such employment and agrees to render such services to the Company, on the terms and conditions set forth in this Agreement.  Unless terminated earlier as set forth in Section 4 herein, Executive’s employment and the term under this Agreement shall commence under the terms set forth herein on the Effective Date and shall continue until the third-anniversary of the Effective Date (the “Initial Term”) and, thereafter, shall be extended automatically for successive one-year terms, unless either Executive or the Company gives contrary written notice not less than 60 days in advance of the expiration of the Initial Term or any succeeding term of this Agreement.  The Initial Term, together with any extension thereof in accordance with this Section 1, shall be referred to herein as the “Term.”

 

2.                                      Positions and Authority.  Executive shall serve in the position of Senior Vice President, Chief Financial Officer of the Company, or in such other position as the parties may agree.  Executive agrees to serve in the officer position referred to in this Section 2, and to perform diligently and to the best of his abilities the duties and services appertaining to such offices as set forth in the Bylaws of the Company, as well as such additional duties and services appropriate to such offices that the parties may agree upon from time to time.  Upon the Effective Date, Executive’s principal place of work shall be located in Boston, Massachusetts.

 

During the Term, Executive shall devote Executive’s full business time and efforts to the business and affairs of the Company and its subsidiaries, provided that the Executive shall be entitled to serve as a member of the board of directors of a reasonable number of other companies, to serve on civic, charitable, educational, religious, public interest or public service boards, and to manage the Executive’s personal and family investments, in each case, to the extent such activities do not materially interfere with the performance of the Executive’s duties and responsibilities

 

 

hereunder.  Executive shall not become a director of any for profit entity without first receiving the approval of the Chief Executive Officer of the Company.

 

3.                                      Compensation and Benefits

 

(a)                                 Base Salary.  As compensation for Executive’s performance of Executive’s duties hereunder, Company shall pay to Executive an initial Base Salary of $350,000 per year, payable in accordance with the normal payroll practices of the Company.  The Base Salary shall be reviewed for increases but not decreases by the Compensation Committee of the Board (the “Compensation Committee”) in good faith, based upon the Company’s and Executive’s performance and the Company’s pay philosophy, not less often than annually.  The term “Base Salary” shall refer to the Base Salary as may be in effect from time to time.

 

(b)                                 Annual Incentive Compensation.  During the Term, Executive shall be eligible to participate in the annual cash bonus program maintained for senior executive officers of the Company (the “Annual Incentive Program”), with an initial target annual bonus opportunity equal to 35% of Base Salary.  The actual amount of the annual bonus earned by and payable to Executive for any year or portion of a year, as applicable, shall be determined upon the satisfaction of goals and objectives established by the Compensation Committee, and shall be subject to such other terms and conditions of the Annual Incentive Program as in effect from time to time.  Each bonus paid under the Annual Incentive Program shall be paid to Executive no later than March 15th of the calendar year following the calendar year in which the bonus is earned.

 

(c)                                  Long-Term Incentive Grants.  During the Term, Executive shall be eligible to participate in the long-term incentive program maintained for senior executive officers of the Company (the “LTI Program”), with a LTI Program target opportunity and LTI Program Vehicles determined by the Compensation Committee for each year of participation.

 

(d)                                 Employee Benefits and Perquisites. During the Term, the Executive shall be entitled to receive all benefits and perquisites of employment generally available to other members of the Company’s senior executive management, upon Executive’s satisfaction of the eligibility or participation criteria therefor. The Company reserves the right to modify or terminate employee benefits and perquisites at its discretion.

 

(e)                                  Business Expenses.  Subject to Section 17, Executive shall be reimbursed for reasonable travel and other expenses incurred in the performance of Executive’s duties on behalf of the Company in a manner consistent with the Company’s policies regarding such reimbursements, as may be in effect from time to time.

 

4.                                      Termination of Employment.  (a)            The Term shall end upon the first to occur of:  (i) the expiration of the term of this Agreement pursuant to Section 1 hereof; (ii) Termination due to Disability (as defined below); (iii) termination of Executive’s employment by the Company for any reason other than Termination due to Disability; (iv) Executive’s death; or (v) termination of Executive’s employment by Executive for any reason.  Upon the termination of Executive’s employment with the Company for any reason, Executive shall be deemed to have resigned from all positions with the Company or any of its Affiliates held by Executive as of the date immediately preceding Executive’s termination of employment.

 

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(b)                                 If Executive’s employment ends for any reason, except as otherwise contemplated in this Section 4, Executive shall cease to have any rights to salary, bonus (if any) or other benefits, other than (i) the earned but unpaid portion of Executive’s Base Salary through the date of termination or resignation, (ii)  a lump-sum payment in respect of accrued but unused vacation days at the Executive’s per-business-day Base Salary rate, (iii) any unpaid expense or other reimbursements due to Executive, and (iv) any other amounts or benefits required to be paid or provided by law or under any plan, program, policy or practice of the Company.

 

(c)                                  Termination without Cause or for Good Reason.  If Executive’s employment hereunder shall be terminated by the Company without Cause, termination upon the expiration of the Term following notice of non-renewal by the Company, or by Executive for Good Reason, then in addition to the payments and benefits described in Section 4(b) and subject to Section 17 and Executive’s continuing compliance with Section 5 of this Agreement:

 

(i)                                     the Company shall pay Executive an amount equal to nine months of the Executive’s Base Salary (the “Severance Payment”), payable during the nine-month period following such termination of employment, with the Severance Payment commencing as soon as administratively feasible within 60 days following Executive’s termination of employment and the first installment payment including the portion of the Severance Payment that was payable prior to such first payment date; provided, however, if the Executive’s employment is terminated under circumstances entitling the Executive to severance under this Section 4(c) within 12 months following a Change in Control (a “CIC Qualifying Termination”), then the Severance Payment and period to pay the Severance Payment shall be increased to 12 months;

 

(ii)                                  the Company shall pay Executive an annual bonus for the year of termination equal to the Executive’s target annual bonus opportunity, payable within 60 days following the Executive’s termination of employment, subject to proration based on the number of days in the calendar year that have elapsed prior to the date of termination;

 

(iii)                               following the Executive’s termination of employment, the Company shall pay to the Executive (or to the Executive’s family in the event of Executive’s death) on a monthly basis an amount equal to the monthly amount of the Consolidated Omnibus Budget Reconciliation Act of 1985  continuation coverage premium for such month, at the same level and cost to the Executive (or the Executive’s family in the event of Executive’s death) as immediately preceding the Executive’s termination of employment, under the Company group medical plan in which the Executive participated immediately preceding the Executive’s termination of employment, less the amount of the Executive’s portion of such monthly premium as in effect immediately preceding the Executive’s termination of employment, until the earlier of (A) nine months after the Executive’s termination of employment and (B) the Executive and Executive’s family have obtained other substantially similar healthcare coverage; provided, however, if the Executive experiences a CIC Qualifying Termination, then the number of months set forth in clause (A) of this sentence shall be increased to 12 months;

 

For the avoidance of doubt, Executive shall not be entitled to the benefits described in this Section 4(c) for a Termination due to Disability, termination of Executive’s employment for

 

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Cause, Executive’s death, or termination of Executive’s employment by Executive for any reason other than for Good Reason.

 

(d)                                 Section 280G.  Notwithstanding anything to the contrary in this Agreement, Executive expressly agrees that if the payments and benefits provided for in this Agreement or any other payments and benefits which Executive has the right to receive from the Company and its Affiliates (collectively, the “Payments”), would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (the “Code”)), then the Payments shall be either (i) reduced (but not below zero) so that the present value of the Payments will be one dollar ($1.00) less than three times Executive’s “base amount” (as defined in Section 280G(b)(3) of the Code) and so that no portion of the Payments received by Executive shall be subject to the excise tax imposed by Section 4999 of the Code or (ii) paid in full, whichever produces the better net after-tax position to Executive.  The reduction of Payments, if any, shall be made by reducing first any Payments that are exempt from Section 409A of the Code and then reducing any Payments subject to Section 409A of the Code in the reverse order in which such Payments would be paid or provided (beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time).  The determination as to whether any such reduction in the Payments is necessary shall be made by the Compensation Committee in good faith.  If a reduced Payment is made or provided and, through error or otherwise, that Payment, when aggregated with other payments and benefits from Company (or its Affiliates) used in determining if a “parachute payment” exists, exceeds one dollar ($1.00) less than three times Executive’s base amount, then Executive shall immediately repay such excess to the Company.

 

(e)                                  Certain Definitions.

 

“Affiliate” shall mean all persons and entities directly or indirectly controlling, controlled by or under common control with the Company, where control may be by management authority, or an equity interest of 50% or more (direct or indirect).

 

“Cause” shall mean, in the sole discretion of the Board:

 

(i)                                     conduct by Executive in connection with Executive’s service to the Company or any Affiliate that is fraudulent, unlawful or grossly negligent;

 

(ii)                                  Executive’s material breach of Executive’s material responsibilities to the Company or any Affiliate or Executive’s willful failure to comply with reasonable and lawful directives of the Board;

 

(iii)                               Executive’s material breach of Executive’s material representations, warranties, covenants and/or obligations under this Agreement;

 

(iv)                              material misconduct by Executive that seriously discredits or damages the Company or any Affiliate;

 

(v)                                 nonperformance or unsatisfactory performance of Executive’s material duties or responsibilities to the Company or any Affiliate;

 

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(vi)                              violation of the Company’s or any of its Affiliates’ policies including, without limitation, the Company’s Code of Conduct and policies on equal employment opportunity and prohibition of unlawful harassment; and/or

 

(vii)                           the conviction of, or plea of nolo contendere to, any felony or a misdemeanor involving dishonesty or fraud

 

In the case of each of (ii), (iii), (iv), (v) and (vi) as determined in good faith by the Board after written notice to Executive providing reasonable details of the alleged breach and not less than a 30 day period to cure the alleged breach; provided that the Company may suspend Executive’s employment, access, authority and duties during such cure period.

 

“Change in Control” shall have the meaning assigned to such term in the Company’s 2019 Equity Incentive Plan.

 

“Good Reason” shall mean that Executive has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following actions undertaken by the Company without Executive’s express prior written consent:

 

(i)                                     the changing of Executive’s position from Senior Vice President, Chief Financial Officer;

 

(ii)                                  a material diminution in Executive’s responsibilities, authority or function as Senior Vice President, Chief Financial Officer;

 

(iii)                               a material reduction in Executive’s Base Salary and/or annual target bonus opportunity; provided, however, that Good Reason shall not be deemed to have occurred in the event of a reduction in Executive’s Base Salary and/or annual target bonus opportunity that is pursuant to a reduction program affecting substantially all of the senior level employees of the Company and that does not adversely affect Executive to a greater extent than other similarly situated senior level employees; or

 

(iv)                              a change of more than 50 miles in the geographic location at which Executive must regularly report to work and perform services, except for required travel on business of the Company; provided, however, that “Good Reason” shall not include, following a Change of Control, a reduction in title, position, responsibilities or duties solely by virtue of the Company being acquired and made part of, or operating as a subsidiary or division of a larger company or organization, as long as Executive’s new duties and responsibilities are reasonably commensurate with Executive’s experience.

 

“Good Reason Process” shall mean that:  (i) Executive has reasonably determined in good faith that a “Good Reason” has occurred; (ii) Executive has notified the Board in writing of the first occurrence of the Good Reason condition within 60 days of the first occurrence of such condition; (iii)  Executive has cooperated in good faith with the efforts of the Company, for a period not less than 30 days following such notice (the “Cure Period”), to remedy the condition; (iv) notwithstanding such efforts, the Good Reason condition continues to exist; and (v) Executive terminates employment within 60 days after the end of the Cure Period. If the Good Reason

 

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condition is cured by the Company during the Cure Period, Good Reason shall be deemed not to have occurred.

 

“Termination due to Disability” shall mean Executive’s termination of employment as a result of Executive becoming incapacitated for a period of at least 180 days by accident, sickness or other circumstance that renders Executive mentally or physically incapable of performing the material duties as Senior Vice President, Chief Financial Officer.

 

5.                                      Restrictive Covenants.

 

(a)                                 Confidential Information and Restricted Activities. By signing this Agreement, Executive represents that Executive has carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed on Executive pursuant to this Section 5 (collectively, the “Restrictive Covenant Agreements”).  For purposes of the Restrictive Covenant Agreements, “Company” shall mean the Company and its Affiliates.  Executive agrees that during Executive’s employment and for the twelve month period after Executive’s employment with the Company ends for any reason (the “Restricted Period”) Executive will not (without the Company’s prior written consent), whether as owner, partner, shareholder, director, consultant, agent, employee, co-venturer or otherwise, (i) engage, participate or invest in any business activity anywhere in the world that develops, markets or sells any products, or performs or sells any services that directly or indirectly target the pharmacological restoration of normal function to wild type or missense-mutant  P53 in oncologic applications; provided that this shall not prohibit any investment by Executive in publicly traded stock of a company representing less than two percent of the stock of such company, (ii) (A) solicit or attempt to solicit, or (B) take away or divert from the Company, or attempt to take away or divert from the Company, the business or patronage of any customer(s) known to Executive with respect to which Executive was involved in soliciting, in each case at any time during the twelve-month period that immediately preceded the termination of Executive’s employment with the Company and with which, as a result of Executive’s employment with the Company, Executive had business dealings or about which Executive acquired confidential information, or (iii) (A) recruit or attempt to recruit, solicit or attempt to solicit, hire or attempt to hire, interfere with or endeavor to entice away or (B) assist in recruiting or attempting to recruit, soliciting or attempting to solicit, hiring or attempting to hire, interfering with or enticing away any person who is or was employed by the Company or is or was an agent, representative or consultant of the Company within the six-month period preceding the termination of Executive’s employment with the Company.  Executive agrees without reservation that these restraints are necessary for the reasonable and proper protection of the Company, and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area.  Executive further understands that Executive’s obligations under the Restrictive Covenant Agreements will continue in accordance with their express terms regardless of any changes in Executive’s title, position, duties, salary, compensation or benefits or other terms and conditions of employment.  Executive expressly consents to be bound by the provisions of the Restrictive Covenant Agreements for the benefit of the Company or any Affiliate or successor to whose employ Executive may be transferred.

 

(b)                                 Return of Property. All files, letters, notes, memoranda, reports, records, data, sketches, drawings, notebooks, layouts, charts, quotations and proposals, specification sheets, program listings, blueprints, models, prototypes, or other written, photographic or other tangible

 

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material containing Company information, whether created by Executive or others, which come into Executive’s custody or possession, are the exclusive property of the Company to be used by Executive only in the performance of Executive’s duties for the Company.  Any property situated on the Company’s premises and owned by the Company, including without limitation computers, disks and other storage media, filing cabinets or other work areas, is subject to inspection by the Company at any time with or without notice.  In the event of the termination of Executive’s employment for any reason, Executive will deliver to the Company all files, letters, notes, memoranda, reports, records, data, sketches, drawings, notebooks, layouts, charts, quotations and proposals, specification sheets, program listings, blueprints, models, prototypes, or other written, photographic or other tangible material containing proprietary information, and other materials of any nature pertaining to the proprietary information of the Company and to Executive’s work performed for the Company, and will not take or keep in Executive’s possession any of the foregoing or any copies.

 

(c)                                  Developments. Executive will make full and prompt disclosure to the Company of all inventions, discoveries, designs, developments, methods, modifications, improvements, processes, algorithms, databases, computer programs, formulae, techniques, trade secrets, graphics or images, audio or visual works, and other works of authorship (collectively, “Developments”), whether or not patentable or copyrightable, that are created, made, conceived or reduced to practice by Executive (alone or jointly with others) or under Executive’s direction during the period of Executive’s employment.  Executive acknowledges that all work performed by Executive is on a “work for hire” basis, and Executive hereby does assign and transfer and, to the extent any such assignment cannot be fully made at present, will assign and transfer, to the Company and its successors and assigns all Executive’s right, title and interest in all Developments that (i) relate to the business of the Company or any customer of or supplier to the Company or any of the products or services being researched, developed, manufactured, commercialized, marketed or sold by the Company or that may be used with such products or services; or (ii) result from tasks assigned to Executive by the Company; or (iii) result from the use of premises or personal property (whether tangible or intangible) owned, leased or contracted for by the Company (“Company-Related Developments”), and all related patents, patent applications, trademarks and trademark applications, copyrights and copyright applications, and other intellectual property rights in all countries and territories worldwide and under any international conventions (“Intellectual Property Rights”).  To preclude any possible uncertainty, Executive has provided on Exhibit A to this Agreement a complete list of Developments that Executive has, alone or jointly with others, conceived, developed or reduced to practice prior to the commencement of Executive’s employment with the Company that Executive considers to be Executive’s property or the property of third parties and that Executive wishes to have excluded from the scope of this Agreement (“Prior Inventions”).  Executive has also listed on Exhibit A all patents and patent applications in which Executive is named as an inventor, other than those that have been assigned to the Company, (“Other Patent Rights”).  If no such disclosure is set forth on Exhibit A, Executive represents that there are no Prior Inventions or Other Patent Rights.  If, in the course of Executive’s employment with the Company, Executive incorporates a Prior Invention into a Company product, process or machine or other work done for the Company, Executive hereby grants to the Company a nonexclusive, royalty-free, irrevocable, worldwide license (with the full right to sublicense) to make, have made, modify, use and sell such Prior Invention.  Notwithstanding the foregoing, Executive will not incorporate, or permit to be incorporated, Prior Inventions in any Company-Related Development without the Company’s prior written consent.  This Agreement does not

 

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obligate Executive to assign to the Company any Development that, in the sole judgment of the Company, reasonably exercised, is developed entirely on Executive’s own time and does not relate to the business efforts or research and development efforts in which, during the period of Executive’s employment, the Company actually is engaged or reasonably would be engaged, and does not result from the use of premises or equipment owned or leased by the Company.  However, Executive will also promptly disclose to the Company any such Developments for the purpose of determining whether they qualify for such exclusion.  Executive understands that to the extent this Agreement is required to be construed in accordance with the laws of any state that precludes a requirement in an employee agreement to assign certain classes of inventions made by an employee, this Section 5(c) will be interpreted not to apply to any invention which a court rules and /or the Company agrees falls within such classes.  Executive also hereby waives all claims to any moral rights or other special rights which Executive may have or accrue in any Company-Related Developments.

 

(d)                                 Enforcement of Agreement; Relief. Executive acknowledges and agrees that the Restrictive Covenant Agreements and all other provisions of this Agreement that are intended to endure beyond the terms of Executive’s employment shall survive the termination of Executive’s employment and that any violation of any of the Restrictive Covenant Agreements will cause immediate and irreparable damage to the Company, entitling it to specific performance, injunctive relief and other equitable remedies.  Executive specifically consents to the issuance of temporary, preliminary, and permanent injunctive relief to enforce the terms of this Agreement.  In addition to injunctive relief, the Company is entitled to all money damages available under the law.  If Executive breaches any of the covenants contained in the Restrictive Covenant Agreements, in addition to the Company’s other legal and equitable remedies, the Company may cease any termination benefits to which Executive might otherwise be entitled.  Any such termination of the termination benefits by the Company in the event of a breach by Executive shall not affect Executive’s ongoing obligations to the Company including pursuant to the Release.

 

(e)                                  Notice of Intent to Resign. In the event Executive wishes to voluntarily terminate Executive’s employment, Executive agrees to provide the Company with four (4) weeks advance written notice (the “Notice Period”) of Executive’s intent to do so, and, if Executive intends or contemplates alternative employment, Executive also agrees to provide the Company with accurate information concerning such alternative employment in sufficient detail to allow the Company to meaningfully exercise its rights under this Section 5. After receipt of such notice, the Company, in its sole, absolute and unreviewable discretion, may (i) require Executive to continue working during the Notice Period, (ii) relieve Executive of some or all of his work responsibilities during the Notice Period, or (iii) shorten the Notice Period and make Executive’s voluntary termination of employment effective immediately. Notwithstanding the foregoing, if Executive provides notice of resignation, in no event shall Executive’s separation of employment be considered an involuntary termination by the Company, even if the effective date of termination is accelerated by the Company.

 

(f)                                   Non-Disparagement. Executive agrees during and following the Term not to make, or cause to be made, any statement, observation, or opinion, or communicate any information (whether oral or written, directly or indirectly) that (i) accuses or implies that the Company or its Affiliates engaged in any wrongful, unlawful or improper conduct, whether relating to Executive’s employment (or the termination thereof), the business or operations of the Company or its

 

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Affiliates, or otherwise or (ii) disparages, impugns, or in any way reflects adversely upon the business or reputation of the Company or its Affiliates. Nothing herein will be deemed to preclude Executive from providing truthful testimony or information pursuant to subpoena, court order, or similar legal process, instituting and pursuing legal action, or engaging in other legally protected speech or activities.

 

(g)                                  Protected Rights.  Notwithstanding anything in this Agreement to the contrary, Executive understands that nothing contained in this Agreement limits the Executive’s ability to report possible violations of law or regulation to or file a charge or complaint with the Securities and Exchange Commission, the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Department of Justice, the Congress, any Inspector General, or any other federal, state or local governmental agency or commission or regulatory authority (collectively, “Government Agencies”). Executive further understands that this Agreement does not limit his ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company. Furthermore (i) Executive shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (y) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal, and (ii) if Executive files a lawsuit for retaliation by the Company for reporting a suspected violation of law, Executive may disclose a trade secret to his or her attorney and use the trade secret information in the court proceeding, if Executive files any document containing the trade secret under seal and does not disclose the trade secret except pursuant to court order.

 

(h)                                 Breach.  Executive acknowledges that the restrictions contained in this Agreement are fair, reasonable, and necessary for the protection of the legitimate business interests of the Company, that the Company will suffer irreparable harm in the event of any actual or threatened breach by Executive, and that it is difficult to measure in money the damages which will accrue to the Company by reason of a failure by Executive to perform any of Executive’s obligations under this Section 5.  Accordingly, if the Company or any of its Affiliates institutes any action or proceeding to enforce their rights under this Section 5, to the extent permitted by applicable law, Executive hereby waives the claim or defense that the Company or its Affiliates has an adequate remedy at law, Executive shall not claim that any such remedy at law exists, and Executive consents to the entry of a restraining order, preliminary injunction, or other preliminary, provisional, or permanent court order to enforce this Agreement, and expressly waives any security that might otherwise be required in connection with such relief.  Executive also agrees that any request for such relief by the Company shall be in addition and without prejudice to any claim for monetary damages and/or other relief which the Company might elect to assert.  In the event Executive violates any provision of this Section 5, the Company shall be entitled to recover all costs and expenses of enforcement, including reasonable attorneys’ fees, and the time periods set forth above shall be extended for the period of time Executive remains in violation of the provisions.

 

(i)                                     Release.  Executive’s execution of a complete and general release of any and all of Executive’s potential claims (other than for benefits and payments described in this Agreement or

 

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any other vested benefits with the Company and/or its Affiliates) against the Company, any of its Affiliates, and their respective successors and any officers, employees, agents, directors, attorneys, insurers, underwriters, and assigns of the Company or its Affiliates and/or successors, is an express condition of Executive’s right to receive termination payments and benefits under this Agreement.  Executive shall be required to execute within 45 days after Executive’s termination of employment (or such shorter period of time as specified by the Company) the Company’s standard form of general waiver and release agreement which documents the release required under this Section 5.

 

6.                                      Survival.  Sections 5, 6, 8, 10, and 12 - 17, and such other provisions hereof as may so indicate shall survive and continue in full force and effect in accordance with their respective terms, notwithstanding any termination of the Term.

 

7.                                      Notices.  Any notice provided for in this Agreement shall be in writing and shall be delivered (i) personally, (ii) by certified mail, postage prepaid, (iii) by Federal Express or other reputable courier service regularly providing evidence of delivery (with charges paid by the party sending the notice), or (iv) by facsimile or a PDF or similar attachment to an email, provided that such telecopy or email attachment shall be followed within one (1) business day by delivery of such notice pursuant to clause (i), (ii) or (iii) above.  Any such notice to a party shall be addressed at the address set forth below (subject to the right of a party to designate a different address for itself by notice similarly given):

 

If to the Company:

 

APREA THERAPEUTICS, INC.

535 Boylston Street

Boston, MA 02116

Attention:  Chief Executive Officer

 

If to Executive:

 

Scott M. Coiante

At the most recent address on file with the Company

 

With a copy to:

 

Sidley Austin LLP

Attn:  Geoffrey W. Levin, Esq.

787 Seventh Avenue

New York, NY 10019

 

8.                                      Indemnification.  During the Term, the Company agrees that it shall indemnify Executive and provide Executive with Directors & Officers liability insurance coverage to the same extent that it indemnifies and/or provides such insurance coverage to Board members and other most senior executive officers of the Company

 

9.                                      Entire Agreement.  This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral,

 

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which may have related in any manner to the subject matter hereof, including, without limitation, the Prior Agreement.

 

10.                               No Conflict.  Executive represents and warrants that Executive is not bound by any employment contract, restrictive covenant, or other restriction preventing Executive from carrying out Executive’s responsibilities for the Company, or which is in any way inconsistent with the terms of this Agreement.  Executive further represents and warrants that Executive shall not disclose to the Company or induce the Company to use any confidential or proprietary information or material belonging to any previous employer or others.

 

11.                               Successors and Assigns.  This Agreement shall inure to the benefit of and be enforceable by Executive and his heirs, executors and personal representatives, and the Company and its successors and assigns.  Any successor or assignee of the Company shall assume the liabilities of the Company hereunder.

 

12.                               Governing Law.  This Agreement shall be governed by the internal laws (as opposed to the conflicts of law provisions) of the State of Delaware.

 

13.                               Amendment and Waiver.  The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.

 

14.                               Withholding.  All payments and benefits under this Agreement are subject to withholding of all applicable taxes and other required deductions.

 

15.                               Clawbacks.  The payments to Executive pursuant to this Agreement are subject to forfeiture or recovery by the Company or other action pursuant to any clawback or recoupment policy which the Company may adopt from time to time, including without limitation any such policy or provision that the Company has included in any of its existing compensation programs or plans or that it may be required to adopt under the Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules and regulations thereunder, or as otherwise required by law.

 

16.                               Company Policies.  Executive shall be subject to additional Company policies as they may exist from time-to-time, including policies with regard to stock ownership by senior executives and policies regarding trading of securities.

 

17.                               Code Section 409A.  This Agreement is intended to comply with the requirements of Section 409A of the Code, and shall be interpreted and construed consistently with such intent.  The payments to Executive pursuant to this Agreement are also intended to be exempt from Section 409A of the Code to the maximum extent possible, under either the separation pay exemption pursuant to Treasury regulation §1.409A-1(b)(9)(iii) or as short-term deferrals pursuant to Treasury regulation §1.409A-1(b)(4), and for such purposes, each payment to Executive under this Agreement shall be considered a separate payment.  In the event the terms of this Agreement would subject Executive to taxes or penalties under Section 409A of the Code (“409A Penalties”), the Company and Executive shall cooperate diligently to amend the terms of the Agreement to avoid such 409A Penalties, to the extent possible.  To the extent any amounts under this Agreement

 

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are payable by reference to Executive’s “termination of employment” such term and similar terms shall be deemed to refer to Executive’s “separation from service,” within the meaning of Section 409A of the Code.  Executive hereby agrees to be bound by the Company’s determination of its “specified employees” (as such term is defined in Section 409A of the Code) provided such determination is in accordance with any of the methods permitted under the regulations issued under Section 409A of the Code.  Notwithstanding any other provision in this Agreement, to the extent any payments made or contemplated hereunder constitute nonqualified deferred compensation, within the meaning of Section 409A, then (i) each such payment which is conditioned upon Executive’s execution of a release and which is to be paid or provided during a designated period that begins in one taxable year and ends in a second taxable year, shall be paid or provided in the later of the two taxable years and (ii) if Executive is a specified employee (within the meaning of Section 409A of the Code) as of the date of Executive’s separation from service, each such payment that is payable upon Executive’s separation from service and would have been paid prior to the six-month anniversary of Executive’s separation from service, shall be delayed until the earlier to occur of (A) the first day of the seventh month following Executive’s separation from service or (B) the date of Executive’s death.  Any reimbursement payable to Executive pursuant to this Agreement shall be conditioned on the submission by Executive of all expense reports reasonably required by Employer under any applicable expense reimbursement policy, and shall be paid to Executive within 30 days following receipt of such expense reports, but in no event later than the last day of the calendar year following the calendar year in which Executive incurred the reimbursable expense.  Any amount of expenses eligible for reimbursement, or in-kind benefit provided, during a calendar year shall not affect the amount of expenses eligible for reimbursement, or in-kind benefit to be provided, during any other calendar year.  The right to any reimbursement or in-kind benefit pursuant to this Agreement shall not be subject to liquidation or exchange for any other benefit.  To the extent that the Severance Payment payable hereunder is deemed to be a substitute for a payment provided under another agreement with the Executive, then the Severance Payment payable hereunder shall be paid at the same time and in the same form as such substituted payment to the extent required to comply with Section 409A of the Code.

 

12

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

	
 
    	
APREA THERAPEUTICS, INC.
    

 

 

	
 
    	
By:
    	
/s/ Christian S. Schade
    
	
 
    	
 
    	
Name:
    	
Christian S. Schade
    
	
 
    	
 
    	
Title:
    	
President and Chief   Executive Officer
    

 

 

	
 
    	
EXECUTIVE
    

 

	
 
    	
By:
    	
/s/ Scott M. Coiante
    
	
 
    	
 
    	
Name:
    	
Scott M. Coiante
    
	
 
    	
 
    	
Title:
    	
Senior Vice President,   Chief Financial Officer
    

 

13EX-10.34

Table of Contents

 Exhibit 10.34 

MASTER TRANSACTION AGREEMENT 

Between 
 NETEASE, INC.

 And 
 YOUDAO,
INC. 
 Dated as of [●], 2019 

Table of Contents

 TABLE OF CONTENTS 

 

							
	ARTICLE 1	  

	DEFINITIONS	  

			
	Section 1.1	 	 Defined Terms
	  	 	1	 
	
	ARTICLE 2	  

	DOCUMENTS AND ITEMS TO BE DELIVERED PRIOR TO F-1 FILING	  

			
	Section 2.1	 	 Documents to be delivered by NetEase
	  	 	5	 
	Section 2.2	 	 Documents to be delivered by Youdao
	  	 	6	 
	
	ARTICLE 3	  

	THE IPO AND ACTIONS PENDING THE IPO	  

			
	Section 3.1	 	 Transactions prior to the IPO
	  	 	6	 
	Section 3.2	 	 Cooperation
	  	 	6	 
	
	ARTICLE 4	  

	COVENANTS AND OTHER MATTERS	  

			
	Section 4.1	 	 Other Agreements and Instruments
	  	 	6	 
	Section 4.2	 	 Further Instruments
	  	 	7	 
	Section 4.3	 	 Agreement on Exchange of Information
	  	 	7	 
	Section 4.4	 	 Auditors and Audits; Financial Statements; Accounting
Matters
	  	 	9	 
	Section 4.5	 	 Confidentiality
	  	 	12	 
	Section 4.6	 	 Privileged Matters
	  	 	14	 
	Section 4.7	 	 Future Litigation and Other Proceedings
	  	 	16	 
	Section 4.8	 	 Mail and other Communications
	  	 	16	 
	Section 4.9	 	 Other Inter-Company Services Agreements
	  	 	17	 
	Section 4.10	 	 Payment of Expenses
	  	 	17	 
	
	ARTICLE 5	  

	MUTUAL RELEASES; INDEMNIFICATION	  

			
	Section 5.1	 	 Release of Claims
	  	 	17	 
	Section 5.2	 	 Indemnification by Youdao
	  	 	18	 
	Section 5.3	 	 Indemnification by NetEase
	  	 	18	 
	Section 5.4	 	 Procedures for Defense, Settlement and Indemnification of the Third Party
Claims
	  	 	19	 
	Section 5.5	 	 Additional Matters
	  	 	20	 
	Section 5.6	 	 Survival of Indemnities
	  	 	21	 
	
	ARTICLE 6	  

	DISPUTE RESOLUTION	  

			
	Section 6.1	 	 Dispute Resolution
	  	 	21	 

  
 i 

Table of Contents

							
	
	ARTICLE 7	  

	MISCELLANEOUS	  

			
	Section 7.1	 	 Consent
	  	 	22	 
	Section 7.2	 	 Limitation of Liability
	  	 	22	 
	Section 7.3	 	 Termination
	  	 	23	 
	Section 7.4	 	 Amendment
	  	 	23	 
	Section 7.5	 	 Notices
	  	 	23	 
	Section 7.6	 	 Governing Law
	  	 	23	 
	Section 7.7	 	 Authority
	  	 	23	 
	Section 7.8	 	 Specific Performance
	  	 	23	 
	Section 7.9	 	 Entire Agreement
	  	 	23	 
	Section 7.10	 	 Severability
	  	 	24	 
	Section 7.11	 	 Failure or Indulgence not Waiver; Remedies Cumulative
	  	 	24	 
	Section 7.12	 	 Binding Effect; Assignment
	  	 	24	 
	Section 7.13	 	 No Third Party Beneficiaries
	  	 	24	 
	Section 7.14	 	 Inconsistency
	  	 	24	 
	Section 7.15	 	 Heading
	  	 	24	 
	Section 7.16	 	 Interpretation
	  	 	24	 
	Section 7.17	 	 Counterparts
	  	 	25	 

  
 ii 

Table of Contents

 MASTER TRANSACTION AGREEMENT 

This Master Transaction Agreement (this “Agreement”) is dated as of [●], 2019, by and between NetEase, Inc., a company
incorporated under the laws of the Cayman Islands (“NetEase”), on behalf of itself and other members of the NetEase Group (as defined below), and Youdao, Inc., a company incorporated under the laws of the Cayman Islands
(“Youdao”), on behalf of itself and other members of the Youdao Group (as defined below), (each of NetEase and Youdao a “Party” and, together, the “Parties”). 

RECITALS 
 WHEREAS,
as of the date hereof, Youdao is Controlled by NetEase; 
 WHEREAS, the Parties currently contemplate that Youdao will make an initial
public offering (the “IPO”) pursuant to a Registration Statement on Form F-1 (as so filed, and as amended thereafter from time to time, the “IPO Registration Statement”); and

 WHEREAS, the Parties intend in this Agreement to set forth and memorialize the principal arrangements between NetEase and Youdao
regarding the relationship of the Parties from and after the consummation of the IPO. 
 NOW, THEREFORE, in consideration of the foregoing
recitals, the mutual agreements, covenants and provisions contained in this Agreement, the Parties, intending to be legally bound, agree as follows: 

ARTICLE 1 

DEFINITIONS 

Section 1.1    Defined Terms. The following capitalized terms have the meanings given to them in this
Section 1.1: 
 “Action” means any demand, action, suit, countersuit, claim, counterclaim, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority or any arbitration or mediation tribunal. 
 “ADSs” has
the meaning set forth in Section 3.1(b) of this Agreement. 
 “Affiliate” of any Person means a Person that Controls,
is Controlled by, or is under common Control with such Person; provided that, under this Agreement, “Affiliate” of any member of the NetEase Group excludes members of the Youdao Group, and “Affiliate” of any member of the
Youdao Group excludes members of the NetEase Group. 
 “Agreement” has the meaning set forth in the preamble of this
Agreement. 
 “Confidential Business Information” has the meaning set forth in Section 4.5(b)(iii) of this Agreement.

 “Confidential Information” has the meaning set forth in Section 4.5(b)(i) of this Agreement. 

  
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Table of Contents

 “Confidential Technical Information” has the meaning set forth in
Section 4.5(b)(ii) of this Agreement. 
 “Contract” means any contract, agreement, lease, license, sales order,
purchase order, instrument or other commitment that is binding on any Person or any part of its property under applicable law. 

“Control” means, as used with respect to any Person, the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through ownership of voting securities or other interests, by contract or otherwise; the terms “Controlled by” and “under common Control with” shall have
correlative meanings. 
 “Control Ending Date” means the earlier of (i) the first date upon which members of the
NetEase Group no longer collectively own at least twenty percent (20%) of the voting power of the then outstanding voting securities of Youdao and (ii) the first date upon which NetEase, collectively with the other members of the NetEase Group,
ceases to be the largest beneficial owner of the then outstanding voting securities of Youdao. 
 “Cooperation Framework
Agreement” has the meaning set forth in Section 2.1 of this Agreement. 
 “Dispute” has the meaning set forth
in Section 6.1 of this Agreement. 
 “Dispute Resolution Commencement Date” has the meaning set forth in
Section 6.1 of this Agreement. 
 “Draft IPO Registration Statement” has the meaning set forth in the recitals to this
Agreement. 
 “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended. 

“Governmental Authority” 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. 
 “Indemnifying Party”
means any party which may be obligated to provide indemnification to an Indemnitee pursuant to Section 5.2 or Section 5.3 hereof or any other section of this Agreement or any Inter-Company Agreement. 

“Indemnitee” means any party which may be entitled to release of claims and/or indemnification from an Indemnifying Party
pursuant to Article 5 hereof or any other section of this Agreement or any Inter-Company Agreement. 
 “Information” means
information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including studies, reports, records, books, contracts, instruments, surveys, discoveries, ideas,
concepts, know-how, techniques, designs, specifications, drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, databases, computer data, disks, diskettes, tapes, computer programs or
other software, marketing plans, customer names, communications by or to attorneys (excluding any client-privileged communications), memos and other materials prepared by attorneys or under their direction (including attorney work product), and any
other confidential, proprietary, technical, financial, employee or business information or data. 

  
 2 

Table of Contents

 “Intellectual Property License Agreement” has the meaning set forth in
Section 2.1 of this Agreement. 
 “Inter-Company Agreements” means the Transitional Services Agreement, the Non-Competition Agreement, the Cooperation Framework Agreement and the Intellectual Property License Agreement. 

“IPO” has the meaning set forth in the recitals to this Agreement. 

“IPO Registration Statement” has the meaning set forth in the recitals to this Agreement. 

“Liabilities” means all debts, liabilities, guarantees, assurances, commitments and obligations, whether fixed, contingent or
absolute, asserted or unasserted, matured or unmatured, liquidated or unliquidated, accrued or not accrued, known or unknown, due or to become due, whenever or however arising (including, without limitation, whether arising out of any Contract or
tort based on negligence or strict liability) and whether or not the same would be required by U.S. GAAP to be reflected in financial statements or disclosed in the notes thereto. 

“Loss” and “Losses” mean any and all damages, losses, deficiencies, Liabilities, obligations, penalties,
judgments, settlements, claims, payments, fines, interest, costs and expenses (including, without limitation, the costs and expenses of any and all Actions and demands, assessments, judgments, settlements and compromises relating thereto and the
reasonable costs and expenses of attorneys’, accountants’, consultants’ and other professionals’ fees and expenses incurred in the investigation or defense thereof or the enforcement of rights hereunder), but excluding punitive
damages (other than punitive damages awarded to any third party against an indemnified party). 
 “NetEase’s Auditors”
has the meaning set forth in Section 4.4(a)(i) of this Agreement. 
 “NetEase Business” means any business that is
conducted by the NetEase Group as of the date hereof and may be conducted by the NetEase Group from time to time, and any business that is derived from the foregoing businesses; for the avoidance of doubt, “NetEase Business” shall not
include the Online Learning Business. 
 “NetEase Group” means NetEase and its subsidiaries and VIEs, other than the Youdao
Group. 

  
 3 

Table of Contents

 “NetEase Indemnitees” means NetEase and its subsidiaries and VIEs
(excluding the Youdao Group) and each of their respective directors, officers and employees. 
 “NetEase Liabilities” means
(without duplication) the following Liabilities: 
 (i)    all Liabilities, arising on or after
June 30, 2019, that relate to, arise or result from the operation of the NetEase Business, other than Youdao Liabilities; and 

(ii)    Liabilities of NetEase and its subsidiaries and VIEs under this Agreement or any of the
Inter-Company Agreements. 
 “Non-Competition Agreement” has the meaning set forth
in Section 2.1 of this Agreement. 
 “Online Learning Business” means the provision of online learning products
(including online knowledge tools and smart devices) and online learning services (including online courses and interactive learning apps) by the Youdao Group as of the date hereof, as more completely described in the IPO Registration Statement; for
the avoidance of doubt, “Online Learning Business” shall not include development and operation of online games, emails, e-commerce business, FinTech services, music applications, online reading, news and information, information security,
SaaS, NetEase open online courses, the K-12 curriculum course offered by the NetEase Group as of the date hereof, films, and television programs. 

“Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization or a Governmental Authority or any department, agency or political subdivision thereof. 

“Privileged Information” has the meaning set forth in Section 4.6(a) of this Agreement. 

“Privileges” has the meaning set forth in Section 4.6(a) of this Agreement. 

“Public Filing Date” means the date when the Draft IPO Registration Statement will be filed publicly with the SEC via its
EDGAR system. 
 “Rule 10A-3(b)(2)” means Rule
10A-3(b)(2) (or any successor rule to similar effect) promulgated under the Exchange Act. 

“SEC” means the U.S. Securities and Exchange Commission. 

“Securities Act” means the Securities Act of 1933, as amended. 

“Subsidiary” means, with respect to any given Person, any Person of which the given Person directly or indirectly Controls.

 “Third Party Claim” has the meaning set forth in Section 5.4(a) of this Agreement. 

“Transitional Services Agreement” has the meaning set forth in Section 2.1 of this Agreement. 

“U.S. GAAP” means generally accepted accounting principles in the United States as in effect from time to time. 

“Underwriters” has the meaning set forth in Section 3.1(a) of this Agreement. 

“Underwriting Agreement” has the meaning set forth in Section 3.1(a) of this Agreement. 

  
 4 

Table of Contents

 “VIE” of any Person means any entity that is Controlled by such Person and
is deemed to be a variable interest entity consolidated with such Person for purposes of U.S. GAAP. 
 “Youdao’s
Auditors” has the meaning set forth in Section 4.4(a)(i) of this Agreement. 
 “Youdao Balance Sheet” means
Youdao’s reviewed consolidated balance sheet as of June 30, 2019. 
 “Youdao Group” means Youdao and its
subsidiaries and VIEs. 
 “Youdao Indemnitees” means Youdao and its subsidiaries and VIEs and each of their respective
directors, officers and employees. 
 “Youdao Liabilities” means (without duplication) the following Liabilities: 

(i)    all Liabilities of NetEase or its subsidiaries and VIEs that arise after the date of the Youdao
Balance Sheet that would be reflected in a Youdao balance sheet as of the date of such Liabilities, if such balance sheet was prepared using the same principles and accounting policies under which the Youdao Balance Sheet was prepared; 

(ii)    all Liabilities, whether arising before, on or after June 30, 2019, that relate to, arise or
result from: (1) the operation of the Online Learning Business or (2) the operation of any business conducted by Youdao and its subsidiaries and VIEs at any time after June 30, 2019; and 

(iii)    Liabilities of Youdao and its subsidiaries and VIEs under this Agreement or any of the
Inter-Company Agreements. 
 ARTICLE 2 

DOCUMENTS AND ITEMS TO BE DELIVERED PRIOR TO F-1 FILING 

Section 2.1    Documents to be delivered by NetEase. NetEase has delivered and/or its subsidiaries and
VIEs have delivered, as appropriate, or NetEase will deliver, or will cause its subsidiaries and VIEs to deliver, as appropriate, prior to the Public Filing Date, to Youdao and/or its subsidiaries and VIEs, as appropriate: (a) a duly executed
Transitional Services Agreement, substantially in the form attached to the Draft IPO Registration Statement as an exhibit, with such changes, if any, to such form as may be agreed to by the Parties in writing prior to such execution (the
“Transitional Services Agreement”); (b) a duly executed Non-Competition Agreement, substantially in the form attached to the Draft IPO Registration Statement as an exhibit, with such changes,
if any, to such form as may be agreed to by the Parties in writing prior to such execution (the “Non-Competition Agreement”); (c) a duly executed Cooperation Framework Agreement, substantially
in the form attached to the Draft IPO Registration Statement as an exhibit, with such changes, if any, to such form as may be agreed to by the Parties in writing prior to such execution (the “Cooperation Framework Agreement”); (d) a
duly executed Intellectual Property License Agreement, substantially in the form attached to the Draft IPO Registration Statement as an exhibit, with such changes, if any, to such form as may be agreed to by the Parties in writing prior to such
execution (the “Intellectual Property License Agreement”); and (e) such other agreements, documents or instruments as the Parties may agree are necessary or desirable in order to achieve the purposes hereof. For
purposes of this Agreement, the Youdao Group will not be considered subsidiaries and VIEs of NetEase. 

  
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Table of Contents

 Section 2.2    Documents to be
delivered by Youdao. Youdao has delivered and/or its subsidiaries and VIEs have delivered, as appropriate, or Youdao will deliver, or will cause its subsidiaries and VIEs to deliver, as appropriate, prior to the Public Filing Date, to NetEase
and/or its subsidiaries, as appropriate: (a) in each case where Youdao or any of its subsidiaries or VIEs is a party to any agreement or instrument referred to in Section 2.1, a duly executed counterpart of such agreement or instrument;
and (b) such other agreements, documents or instruments as the Parties may agree are necessary or desirable in order to achieve the purposes hereof. 

ARTICLE 3 
 THE
IPO AND ACTIONS PENDING THE IPO 
 Section 3.1    Transactions prior
to the IPO. Subject to the occurrence of the events described in this Article 3, the Parties intend to consummate the IPO and to take, or cause to be taken, the actions specified in this Section 3.1. 

(a)    Registration Statement. Youdao has submitted on a confidential basis for review by the SEC the Draft
IPO Registration Statement, and has submitted or intends to submit such amendments or supplements thereto as may be requested by the SEC staff in connection with such review and agreed to by Youdao, and subsequently to file with the SEC the IPO
Registration Statement and make such amendments and supplements thereto as may be necessary or desirable in order to cause the same to comply with the Securities Act and other applicable law, to become and remain effective under the Securities Act,
or as may be requested by the representatives of the underwriters for the IPO (the “Underwriters”), including, without limitation, filing such amendments or supplements to the IPO Registration Statement as may be required by the
underwriting agreement to be entered into among Youdao and the Underwriters (the “Underwriting Agreement”) following the effectiveness of the IPO Registration Statement under the Securities Act. 

(b)    Nasdaq Global Market or New York Stock Exchange Listing. Youdao plans to prepare, file and have approved an
application for listing on the Nasdaq Global Market or the New York Stock Exchange of the American depositary shares, representing the ordinary shares of Youdao to be offered in the IPO (the “ADSs”). 

Section 3.2    Cooperation. NetEase and Youdao shall each consult with, and
cooperate in all respects with, the other in connection with the marketing, including any roadshow presentations, and pricing of the ADSs and shall take any and all actions as may be reasonably necessary or desirable to consummate the IPO as
contemplated by the IPO Registration Statement and the Underwriting Agreement. 
 ARTICLE 4 

COVENANTS AND OTHER MATTERS 

Section 4.1    Other Agreements and Instruments. Each of the Parties agrees
to execute or cause to be executed by the appropriate parties and deliver, as appropriate, such other agreements, instruments and other documents as may be necessary or desirable in order to effect the purposes of this Agreement and the
Inter-Company Agreements. 

  
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 Section 4.2    Further
Instruments. 
 (a)    NetEase will execute and deliver, and will cause its appropriate subsidiaries and VIEs to
execute and deliver, to Youdao and/or its subsidiaries and VIEs, as the case may be, all instruments, assumptions, novations, undertakings, substitutions or other documents and take such other action as may be reasonably necessary or desirable in
order to have NetEase and/or its subsidiaries and VIEs, as the case may be, fully and unconditionally assume the NetEase Liabilities as applicable to each of them; provided, however, that in the absence of such execution and delivery by NetEase
and/or such appropriate subsidiaries and VIEs, such execution and delivery shall be deemed for all purposes to have occurred. 

(b)    Youdao will, and will cause its appropriate subsidiaries and VIEs to, execute and deliver to NetEase and/or its
subsidiaries and VIEs all instruments, assumptions, novations, undertakings, substitutions or other documents and take such other action as may be reasonably necessary or desirable in order to have Youdao and/or its subsidiaries and VIEs, as the
case may be, fully and unconditionally assume the Youdao Liabilities as applicable to each of them; provided, however, that in the absence of such execution and delivery by Youdao and/or such appropriate subsidiaries and VIEs, such execution and
delivery shall be deemed for all purposes to have occurred. 
 (c)    Except as hereinabove provided, neither NetEase,
Youdao, nor their respective subsidiaries and VIEs shall be obligated, in connection with the foregoing matters set forth in this Section, to expend money other than reasonable
out-of-pocket expenses, attorneys’ fees and recording or similar fees, unless reimbursed by the other relevant Party. Furthermore, each Party, at the request of the
other Party hereto, shall execute and deliver such other instruments and do and perform such other acts and things, including transfer of employees, as may be necessary or desirable for effecting completely the consummation of the transactions
contemplated hereby. 
 Section 4.3    Agreement on Exchange of
Information. 
 (a)    Generally. Each of the Parties agrees to provide, or cause to be provided, to the
other Party, at any time, promptly after written request therefor, all reports and other Information regularly provided by one Party to the other Party prior to the Public Filing Date and any Information in the possession or under the control of
such Party to the extent reasonably requested by the requesting Party (i) to comply with reporting, disclosure, filing or other requirements imposed on the requesting Party (including under applicable securities laws) by a Governmental
Authority having jurisdiction over the requesting Party, (ii) for use in any other judicial, regulatory, administrative or other proceeding or in order to satisfy audit, accounting, claims, regulatory, litigation or other similar requirements,
(iii) to comply with its obligations under this Agreement or any Inter-Company Agreement or (iv) at any time after the Public Filing Date to the extent such Information and cooperation are necessary to comply with such reporting, filing
and disclosure obligations, for the preparation of financial statements or completing an audit, and as reasonably necessary to conduct the ongoing businesses of NetEase or Youdao, as the case may be. Each of the Parties agrees to make their
respective personnel available to discuss the Information exchanged pursuant to this Section 4.3. In the event that any Party determines that any such provision of Information or other actions contemplated by this Section 4.3 could be
commercially detrimental, violate any law or agreement, or waive any attorney-client privilege, the Parties shall take all reasonable measures to permit the compliance with such obligations in a manner that avoids any such harm or consequence. 

  
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 (b)    Internal Accounting Controls; Financial Information.
After the Public Filing Date, (i) each Party shall maintain in effect at its own cost and expense adequate systems and controls for its business to the extent necessary to enable the other Party to satisfy its reporting, tax return, accounting,
audit and other obligations, and (ii) each Party shall provide, or cause to be provided, to the other Party and such other Party’s subsidiaries and VIEs in such form as such requesting Party shall request, at no charge to the requesting
Party, all financial and other data and Information as the requesting Party determines necessary or advisable in order to prepare its financial statements and reports or filings with any Governmental Authority. 

(c)    Ownership of Information. Any Information owned by a Party that is provided to a requesting Party pursuant
to this Section 4.3 shall remain the sole and exclusive property of the providing Party. Unless specifically set forth herein, nothing contained in this Agreement shall be construed as granting or conferring any right, license or otherwise in
any such Information. 
 (d)    Record Retention. To facilitate the possible exchange of Information pursuant to
this Section 4.3 and other provisions of this Agreement, each Party agrees to use its reasonable best efforts for a period of ten (10) years to retain all Information in its respective possession or control substantially in accordance with
its respective record retention policies and/or practices as in effect on the Public Filing Date, and for such longer period as may be required by any Governmental Authority, any litigation matter, any applicable law or any Inter-Company Agreement.
However, at any time after such ten (10)-year period each Party may amend its respective record retention policies at such Party’s discretion; provided, however, that the amending Party must give thirty (30) calendar days prior written
notice of such change in the policy to the other Party. No Party will destroy, or permit any of its subsidiaries or VIEs to destroy, any Information that exists on the Public Filing Date (other than Information that is permitted to be destroyed
under the current respective record retention policies of each Party) and that falls under the categories listed in Section 4.3(a), without first notifying the other Party of the proposed destruction and giving the other Party the opportunity
to take possession or make copies of such Information prior to such destruction. 
 (e)    Limitation of
Liability. Each Party will use its reasonable best efforts to ensure that Information provided to the other Party hereunder is accurate and complete; provided, however, that no Party shall have any liability to the other Party if any Information
exchanged or provided pursuant to this Section 4.3 is found to be inaccurate, in the absence of gross negligence, bad faith, or willful misconduct by the Party providing the Information. No Party shall have any liability to the other Party if
any Information is destroyed or lost after the relevant Party has complied with the provisions of Section 4.3(d). 

(f)    Other Agreements Providing for Exchange of Information. The rights and obligations granted under this
Section 4.3 are subject to any specific limitations, qualifications or additional provisions on the sharing, exchange or confidential treatment of Information set forth in this Agreement and any Inter-Company Agreement. 

  
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 (g)    Production of Witnesses; Records; Cooperation. For a
period of five (5) years after the Control Ending Date, and except in the case of a legal or other proceeding by one Party against the other Party, each Party shall use its reasonable best efforts to make available to the other Party, upon
written request, the former, current and future directors, officers, employees, other personnel and agents of such Party as witnesses and any books, records or other documents within its control or which it otherwise has the ability to make
available, to the extent that any such individual (giving consideration to business demands of such directors, officers, employees, other personnel and agents) or books, records or other documents may reasonably be required in connection with any
legal, administrative or other proceeding in which the requesting Party may from time to time be involved, regardless of whether such legal, administrative or other proceeding is a matter with respect to which indemnification may be sought
hereunder. The requesting Party shall bear all costs and expenses in connection therewith. 

Section 4.4    Auditors and Audits; Financial Statements; Accounting
Matters. Each Party agrees that: 
 (a)    Selection of Auditors. 

(i)    Until the first NetEase fiscal year end occurring after the Control Ending Date, Youdao shall use
its reasonable efforts to engage the independent registered public accounting firm used by NetEase (“NetEase’s Auditors” and, for the avoidance of doubt, should NetEase at any time change the independent
registered public accounting firm serving as its auditors, “NetEase’s Auditors” shall thereafter mean the new firm serving as NetEase’s auditors) to serve as its auditors (“Youdao’s
Auditors”) for purposes of providing an opinion on its consolidated financial statements; provided, however, that Youdao’s Auditors may be different from NetEase’s Auditors if necessary to comply with applicable laws and stock
exchange rules regarding auditor independence and qualifications and audit committee responsibilities (provided, however, that Youdao shall not take any actions, and shall use its reasonable best efforts to cause its directors, officers and
employees not to take any actions, that could reasonably be expected to require Youdao to engage auditors other than NetEase’s Auditors). After the Public Filing Date, the foregoing shall not be construed so as to unlawfully limit any
responsibility of the audit committee of Youdao’s board of directors, pursuant to SEC Rule 10A-3(b)(2) and rules of the Nasdaq Global Market or the New York Stock Exchange, as applicable, to appoint,
compensate, retain and oversee the work of the registered public accounting firm Youdao engages. 

(ii)    Until the first NetEase fiscal year end occurring after the Control Ending Date, Youdao shall
provide to NetEase as much prior notice as reasonably practical of any change in Youdao’s Auditors for purposes of providing an opinion on its consolidated financial statements. 

(b)    Date of Auditors’ Opinion and Quarterly Reviews. Until the first NetEase fiscal year end occurring
after the Control Ending Date, and thereafter to the extent necessary for the purpose of preparing financial statements or completing a financial statement audit, Youdao shall use its reasonable best efforts to enable Youdao’s Auditors to
complete their audit such that they will date their opinion on Youdao’s audited annual financial statements no later than the date that NetEase’s Auditors date their opinion on NetEase’s audited annual financial statements, and to
enable NetEase to meet its timetable for the printing, filing and public dissemination of NetEase’s annual financial statements. Until the first NetEase fiscal year end occurring after the Control Ending Date, and thereafter to the extent
necessary for the purpose of preparing financial statements or completing a financial statement audit, Youdao shall use its reasonable best efforts to enable Youdao’s Auditors to complete their annual audit and quarterly review procedures such
that they will provide clearance on such Party’s annual and quarterly financial statements no later than the date that NetEase’s Auditors provide clearance on NetEase’s annual and quarterly financial statements. 

  
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 (c)    Annual and Quarterly Financial Statements. Until the
Control Ending Date, Youdao shall not change its fiscal year and, until the first NetEase fiscal year end occurring after the Control Ending Date, and thereafter to the extent necessary for the purpose of preparing financial statements or completing
a financial statement audit, shall provide to NetEase on a timely basis all Information that NetEase reasonably requires to meet its schedule for the preparation, printing, filing, and public dissemination of NetEase’s annual and quarterly
financial statements. Without limiting the generality of the foregoing, Youdao will provide all required financial Information with respect to the Youdao Group to Youdao’s Auditors in a sufficient and reasonable time and in sufficient detail to
permit Youdao’s Auditors to take all steps and perform all procedures necessary to provide sufficient assistance to NetEase’s Auditors with respect to financial Information to be included or contained in NetEase’s annual and quarterly
financial statements. Without limiting the generality of the foregoing, Youdao shall provide to NetEase its audited annual consolidated financial statements within ninety (90) calendar days after the close of each fiscal year, and its unaudited
quarterly consolidated financial statements within thirty (30) calendar days after the end of each fiscal quarter. Similarly, NetEase shall provide to Youdao on a timely basis all financial Information that Youdao reasonably requires to meet
its schedule for the preparation, printing, filing, and public dissemination of Youdao’s annual and quarterly financial statements. Without limiting the generality of the foregoing, NetEase will provide all required financial Information with
respect to the NetEase Group to NetEase’s Auditors in a sufficient and reasonable time and in sufficient detail to permit NetEase’s Auditors to take all steps and perform all procedures necessary to provide sufficient assistance to
Youdao’s Auditors with respect to Information to be included or contained in Youdao’s annual and quarterly financial statements. 

(d)    Certifications and Attestations. 

(i)    Until the first NetEase fiscal year end occurring after the Control Ending Date, and thereafter to
the extent necessary for the timely filing by NetEase of annual and quarterly reports under the Exchange Act or in connection with any investigations of prior periods, Youdao shall cause its principal executive officer and principal financial
officer to provide to NetEase on a timely basis and as reasonably requested by NetEase (A) any certificates requested as support for the certifications and attestations required by Sections 302, 906 and 404 of the Sarbanes-Oxley Act of 2002 to
be filed with such annual and quarterly reports, (B) any certificates or other written Information which such principal executive officer or principal financial officer received as support for the certificates provided to NetEase and (C) a
reasonable opportunity to discuss with such principal financial officer and other appropriate officers and employees of Youdao any issues reasonably related to the foregoing. 

  
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 (ii)    To the extent necessary for the timely filing
by Youdao of annual and quarterly reports under the Exchange Act or in connection with any investigations of prior periods, NetEase shall cause its appropriate officers and employees to provide to Youdao on a timely basis and as reasonably requested
by such Party (A) any certificates requested as support for the certifications and attestations required by Sections 302, 906 and 404 of the Sarbanes-Oxley Act of 2002 to be filed with such annual and quarterly reports, (B) any
certificates or other Information which such appropriate officers and employees received as support for the certificates provided to Youdao and (C) a reasonable opportunity to discuss with such appropriate officers and employees any issues
reasonably related to the foregoing. 
 (e)    Compliance With Laws, Policies and Regulations. Until the Control
Ending Date, Youdao shall comply with all financial accounting and reporting rules, policies and directives of NetEase, to the extent such rules, policies and directives have been previously communicated to Youdao, and fulfill all timing and
reporting requirements, applicable to subsidiaries and VIEs that are consolidated with NetEase for financial statement purposes. Without limiting the foregoing, Youdao shall comply with all financial accounting and reporting rules and policies, and
fulfill all timing and reporting requirements, under applicable federal securities laws and the rules of the Nasdaq Global Market or the New York Stock Exchange, as applicable. Youdao shall not be deemed to be in breach of its obligations set forth
in this provision to the extent that it is unable to comply with such obligations as a result of the actions or inactions of NetEase. 

(f)    Identity of Personnel Performing the Annual Audit and Quarterly Reviews. Until the Control Ending Date, and
thereafter to the extent such information and cooperation is necessary for the preparation of financial statements or completing a financial statements audit, Youdao shall authorize Youdao’s Auditors to make available to NetEase’s Auditors
both the personnel who performed or will perform the annual audits and quarterly reviews of Youdao and work papers related to the annual audits and quarterly reviews of Youdao, in all cases within a reasonable time prior to Youdao’s
Auditors’ opinion date, so that NetEase’s Auditors are able to perform the procedures they consider necessary to take responsibility for the work of Youdao’s Auditors as it relates to NetEase’s Auditors’ report on
NetEase’s financial statements, all within sufficient time to enable NetEase to meet its timetable for the printing, filing and public dissemination of NetEase’s annual and quarterly financial statements. Similarly, NetEase shall authorize
NetEase’s Auditors to make available to Youdao’s Auditors both the personnel who performed or will perform the annual audits and quarterly reviews of NetEase and work papers related to the annual audits and quarterly reviews of NetEase, in
all cases within a reasonable time prior to NetEase’s Auditors’ opinion date, so that Youdao’s Auditors are able to perform the procedures they consider necessary to take responsibility for the work of NetEase’s Auditors as it
relates to Youdao’s Auditors’ report on Youdao’s financial statements, all within sufficient time to enable Youdao to meet its timetable for the printing, filing and public dissemination of Youdao’s annual and quarterly financial
statements. 
 (g)    Access to Books and Records. Until the Control Ending Date, and thereafter to the extent
such information and cooperation is necessary for the preparation of financial statements or completing a financial statements audit or dealing with tax matters, Youdao shall provide NetEase’s internal auditors, counsel and other designated
representatives of NetEase access during normal business hours to (i) the premises of the Youdao Group and all Information (and duplicating rights) within the knowledge, possession or control of the Youdao Group and (ii) the officers and
employees of Youdao and each other member of the Youdao Group, so that NetEase may conduct reasonable audits relating to the financial statements provided by Youdao pursuant hereto as well as to the internal accounting controls and operations of
Youdao. 

  
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 (h)    Notice of Change in Accounting Principles. Until the
Control Ending Date, and thereafter if a change in accounting principles by a Party would affect the historical financial statements of the other Party, no such Party shall make or adopt any significant changes in its accounting estimates or
accounting principles from those in effect on the Public Filing Date without first consulting with the other Party, and if requested by the other Party, such other Party’s independent registered public accounting firm with respect thereto.
NetEase shall give Youdao as much prior notice as reasonably practical of any proposed determination of, or any significant changes in, its accounting estimates or accounting principles from those in effect on the Public Filing Date. NetEase will
consult with Youdao and, if requested by Youdao, Youdao’s independent registered public accounting firm with respect thereto. Youdao shall give NetEase as much prior notice as reasonably practical of any proposed determination of, or any
significant changes in, its accounting estimates or accounting principles from those in effect on the Public Filing Date. Youdao will consult with NetEase and, if requested by NetEase, NetEase’s independent registered public accounting firm
with respect thereto.  
 (i)    Conflict With Third-Party Agreements. Nothing in Section 4.3 or
this Section 4.4 shall require a Party to violate any agreement with any third party regarding the confidentiality of confidential and proprietary Information relating to that third party or its business; provided, however, that in the event
that a Party is required under Section 4.3 or this Section 4.4 to disclose any such Information, such Party shall use its reasonable best efforts to seek to obtain such third party’s consent to the disclosure of such Information. 

Section 4.5    Confidentiality. 

(a)    Each of the Parties shall hold and shall cause each of their respective subsidiaries and VIEs to hold, and shall
each cause their respective officers, directors, employees, agents, consultants and advisors and those of their respective subsidiaries and VIEs to hold, in strict confidence and not to disclose or release without the prior written consent of the
other Party, any and all Confidential Information concerning such other Party and its respective subsidiaries and VIEs; provided, that each of the Parties may disclose, or may permit disclosure of, Confidential Information (i) to their
respective subsidiaries and VIEs, auditors, attorneys, financial advisors, bankers and other appropriate consultants and advisors who need to know such information and, in each case, are informed of their obligation to hold such information
confidential to the same extent as is applicable to the Parties hereto and in respect of whose failure to comply with such obligations, Youdao or NetEase, as the case may be, will be responsible, (ii) if the Parties or any of their respective
subsidiaries or VIEs are compelled to disclose any such Confidential Information by judicial or administrative process or (iii) if the Parties reasonably determine in good faith that such disclosure is required by other requirements of law.
Notwithstanding the foregoing, in the event that any demand or request for disclosure of Confidential Information is made in connection with any judicial or administrative process, or a Party determines in good faith that disclosure is otherwise
required by law, such Party shall promptly notify the other Party of the existence of such request, demand, or conclusion, and shall provide such other Party a reasonable opportunity to seek an appropriate protective order or other remedy, which the
notifying Party will cooperate in obtaining. In the event that an appropriate protective order or other remedy is not obtained, the Party whose Confidential Information is required to be disclosed shall or shall cause the notifying Party to furnish,
or cause to be furnished, only that portion of the Confidential Information that is required to be disclosed and shall use its reasonable best efforts to obtain reasonable assurances that confidential treatment will be accorded to such Information.

  
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 (b)    As used in this Section 4.5: 

(i)     “Confidential Information” shall mean Confidential Business Information and
Confidential Technical Information concerning one Party which, prior to, on or following the Public Filing Date, has been disclosed by such Party or its subsidiaries or VIEs, that (1) is in written, recorded, graphical or other tangible form
and is marked “Proprietary,” “Confidential” or “Trade Secret,” or where it is evident from the nature and content of such Information that the disclosing Party considers it to be confidential, (2) is in oral form
and identified by the disclosing Party as “Proprietary,” “Confidential” or “Trade Secret” at the time of oral disclosure, including pursuant to the access provisions of Section 4.3 or Section 4.4 hereof or any
other provision of this Agreement or where it is evident from the nature and content of such Information that the disclosing Party considers it to be confidential, or (3) in the case of such Information disclosed on or prior to the date hereof,
either such Information is identified by the owning Party to the other relevant Party as Confidential Business Information or Confidential Technical Information, orally or in writing on or prior to the Public Filing Date, or it is evident from the
nature and content of such Information that the disclosing Party considers it to be confidential, and includes any modifications or derivatives prepared by the receiving Party that contain or are based upon any Confidential Information obtained from
the disclosing Party, including any analysis, reports, or summaries of the Confidential Information. Confidential Information may also include Information disclosed to a disclosing Party by third parties. Confidential Information shall not, however,
include any information which (A) was publicly known and made generally available in the public domain prior to the time of disclosure by the disclosing Party; (B) becomes publicly known and made generally available after disclosure by the
disclosing Party to the receiving Party through no action or inaction of the receiving Party; (C) is obtained by the receiving Party from a third party without a breach of such third party’s obligations of confidentiality; or (D) is
on or after the Public Filing Date independently developed by the receiving Party without use of or reference to the disclosing Party’s Confidential Information. 

(ii)    “Confidential Technical Information” shall mean all proprietary scientific,
engineering, mathematical or design information, data and material of the disclosing Party including, without limitation, (a) specifications, ideas, concepts, models, and strategies for products or services, (b) quality assurance policies,
procedures and specifications, (c) source code and object code, (d) training materials and information, and (e) all other know-how, methodology, processes, procedures, techniques, trade secrets
or proprietary or confidential information related to product or service design, development, manufacture, implementation, use, support and maintenance. 

  
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 (iii)    “Confidential Business
Information” shall mean all confidential or proprietary information, data or material of the disclosing Party other than Confidential Technical Information, including, but not limited to (a) proprietary earnings reports and forecasts,
(b) proprietary macro-economic reports and forecasts, (c) proprietary business plans, (d) proprietary general market evaluations and surveys, (e) proprietary financing and credit-related information, and (f) customer
information. 
 (c)    Nothing in this Agreement shall restrict (i) the disclosing Party from using, disclosing,
or disseminating its own Confidential Information in any way, or (ii) reassignment of the receiving Party’s employees. Moreover, nothing in the Agreement supersedes any restriction imposed by third parties on their Confidential
Information, and there is no obligation on the disclosing Party to conform third party agreements to the terms of this Agreement except as expressly set forth therein. 

(d)    Notwithstanding anything to the contrary set forth herein, (i) a Party and its subsidiaries and VIEs shall be
deemed to have satisfied their obligations hereunder with respect to Confidential Information if they exercise the same degree of care (but no less than a reasonable degree of care) as they take to preserve confidentiality for their own similar
Information and (ii) confidentiality obligations provided for in any agreement between a Party or any of its subsidiaries or VIEs and any employee of such Party or any of its subsidiaries or VIEs shall remain in full force and effect. 

(e)    Confidential Information of a Party and its subsidiaries and VIEs in the possession of and used by the other Party
as of the Public Filing Date may continue to be used by such Party in possession of the Confidential Information in and only in the operation of the NetEase Business, in the case of the NetEase Group, or the Online Learning Business, in the case of
the Youdao Group, and may be used only so long as the Confidential Information is maintained in confidence and not disclosed in violation of Section 4.5(b). Such continued right to use Confidential Information may not be transferred, including
by merger, consolidation, reorganization, operation of law, or otherwise, to any third party unless such third party (A) purchases all or substantially all of the business or business line and assets in one transaction or in a series of related
transactions for which or in which the relevant Confidential Information is used or employed and (B) expressly agrees in writing to be bound by the provisions of this Section 4.5. In the event that such right to use is transferred in
accordance with the preceding sentence, the transferring Party shall not disclose the source of the relevant Confidential Information. 
 
Section 4.6    Privileged Matters. The Parties agree that their respective rights and obligations to maintain, preserve, assert or waive any or all privileges belonging to each such Party or its subsidiaries or
VIEs including but not limited to the attorney-client and work product privileges (collectively, “Privileges”), shall be governed by the provisions of this Section 4.6. With respect to Privileged Information (as defined below)
of NetEase, NetEase shall have sole authority in perpetuity to determine whether to assert or waive any or all Privileges, and Youdao shall take no action (nor permit any of its subsidiaries or VIEs to take action) without the prior written consent
of NetEase that could result in any waiver of any Privilege that could be asserted by NetEase or any of its subsidiaries or VIEs under applicable law and this Agreement. With respect to Privileged Information of Youdao, Youdao shall have sole
authority in perpetuity to determine whether to assert or waive any or all Privileges, and NetEase shall take no action (nor permit any of its subsidiaries or VIEs to take action) without the prior written consent of Youdao that could result in any
waiver of any Privilege that could be asserted by Youdao or any of its subsidiaries or VIEs under applicable law and this Agreement. 

  
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 (a)    The rights and obligations created by this Section 4.6
shall apply to all Information as to which the Parties or their respective subsidiaries or VIEs would be entitled to assert or has asserted a Privilege (“Privileged Information”). For the avoidance of doubt, the Parties agree that
Privileged Information of NetEase includes but is not limited to (i) all Information subject to a Privilege regarding the business of the NetEase Group (other than Information regarding the Online Learning Business), whether or not it is in the
possession of the Youdao Group; (ii) all communications subject to a Privilege between counsel for NetEase (including in-house counsel) and any individual who, at the time of the communication, was an
employee of NetEase, regardless of whether such employee is or becomes an employee of the Youdao Group and (iii) all Information subject to a Privilege generated, received or arising after the Public Filing Date that refers or relates to
Privileged Information of NetEase generated, received or arising prior to the Public Filing Date. Privileged Information of Youdao includes but is not limited to (x) all Information subject to a Privilege regarding the Online Learning Business,
whether or not it is in the possession of the NetEase Group; (y) all communications subject to a Privilege occurring after the Public Filing Date between counsel for Youdao (including in-house counsel and
former in-house counsel who are or were employees of NetEase) and any person who, at the time of the communication, was an employee of Youdao, regardless of whether such employee was, is or becomes an employee
of any member of the NetEase Group and (z) all Information subject to a Privilege generated, received or arising after the Public Filing Date that refers or relates to Privileged Information of Youdao generated, received or arising prior to the
Public Filing Date. 
 (b)    Upon receipt by a Party or its subsidiaries or VIEs of any subpoena, discovery or other
request from any third party that actually or arguably calls for the production or disclosure of Privileged Information of the other Party or its subsidiaries or VIEs, or if a Party or any of its subsidiaries or VIEs obtains knowledge that any of
its current or former employees has received any subpoena, discovery or other request from any third party that actually or arguably calls for the production or disclosure of Privileged Information of the other Party or its subsidiaries or VIEs,
such Party shall promptly notify that other Party of the existence of the request and shall provide that other Party a reasonable opportunity to review the Information and to assert any rights such other Party may have under this Section 4.6 or
otherwise to prevent the production or disclosure of Privileged Information. NetEase or its subsidiaries or VIEs, or Youdao or its subsidiaries and VIEs, as the case may be, will not produce or disclose to any third party any of the other
Party’s Privileged Information under this Section 4.6 unless (a) such other Party has provided its express written consent to such production or disclosure or (b) a court of competent jurisdiction has entered an order not subject
to interlocutory appeal or review finding that the Information is not entitled to protection from disclosure under any applicable privilege, doctrine or rule. 

(c)    NetEase’s transfer of books and records pertaining to the Online Learning Business and other Information
pertaining to Youdao, if any, NetEase’s agreement to permit Youdao to obtain Information existing prior to the Public Filing Date, Youdao’s transfer of books and records and other Information pertaining to NetEase, if any, and
Youdao’s agreement to permit NetEase to obtain Information existing prior to the Public Filing Date are made in reliance on NetEase’s and Youdao’s respective agreements, as set forth in Section 4.5 and this Section 4.6, to
maintain the confidentiality of such Information and to take the steps provided herein for the preservation of all Privileges that may belong to or be asserted by NetEase, or Youdao, as the case may be. The access to Information, witnesses and
individuals being granted pursuant to Section 4.3 and Section 4.4 and the disclosure to one Party of Privileged Information relating to the other Party’s businesses pursuant to this Agreement shall not be asserted by NetEase or Youdao
to constitute, or otherwise be deemed, a waiver of any Privilege that has been or may be asserted under this Section 4.6 or otherwise. Nothing in this Agreement shall operate to reduce, minimize or condition the rights granted to, or the
obligations imposed upon, NetEase and Youdao by this Section 4.6. 

  
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 Section 4.7    Future
Litigation and Other Proceedings. In the event that Youdao (or any of its subsidiaries or VIEs or any of its or their respective officers or directors) or NetEase (or any of its subsidiaries or VIEs or any of its or their respective officers or
directors) at any time after the date hereof initiates or becomes subject to any litigation or other proceedings before any Governmental Authority or arbitration panel with respect to which the Parties have no prior agreements (as to indemnification
or otherwise), the Party (and its subsidiaries and VIEs and its and their respective officers and directors) that has not initiated and is not subject to such litigation or other proceedings shall comply, at the litigant Party’s expense, with
any reasonable requests by the litigant Party for assistance in connection with such litigation or other proceedings (including by way of provision of Information and making available of employees as witnesses). In the event that Youdao (or any of
its subsidiaries or VIEs or any of its or their respective officers or directors) and NetEase (or any of its subsidiaries or VIEs or any of its or their respective officers or directors), or any combination thereof, at any time after the date hereof
initiate or become subject to any litigation or other proceedings before any Governmental Authority or arbitration panel with respect to which the litigant Parties have no prior agreements (as to indemnification or otherwise), each litigant Party
(and its officers and directors) shall, at their own expense, coordinate their strategies and actions with respect to such litigation or other proceedings to the extent such coordination would not be detrimental to their respective interests and
shall comply, at the expense of the requesting Party, with any reasonable requests of such Party for assistance in connection therewith (including by way of provision of Information and making available of employees as witnesses). 

Section 4.8    Mail and other Communications. Each of NetEase and Youdao
may receive mail, facsimiles, packages and other communications properly belonging to the other. Accordingly, each Party authorizes each of the other Party to receive and open all mail, telegrams, packages and other communications received by it and
not unambiguously intended for the other Party or any of the other Party’s officers or directors, and to retain the same to the extent that they relate to the business of the receiving Party or, to the extent that they do not relate to the
business of the receiving Party, the receiving Party shall promptly deliver such mail, telegrams, packages or other communications, including, without limitation, notices of any liens or encumbrances on any asset transferred to the Youdao Group in
connection with the separation from NetEase, if any, (or, in case the same relate to both businesses, copies thereof) to the other Party as provided for in Section 7.5 hereof. The provisions of this Section 4.8 are not intended to, and
shall not, be deemed to constitute (a) an authorization by either NetEase or Youdao to permit the other to accept service of process on its behalf and no Party is or shall be deemed to be the agent of the other Party for service of process
purposes or (b) a waiver of any Privilege with respect to Privileged Information contained in such mail, telegrams, packages or other communications. 

  
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 Section 4.9    Other
Inter-Company Services Agreements. To the extent not covered under the Inter-Company Agreements, members of the NetEase Group, on the one hand, and members of the Youdao Group, on the other, may enter into other services agreements from time to
time covering the provision of various services, if any, including financial, accounting, legal, and other services by the members of the NetEase Group to the members of the Youdao Group or, in certain circumstances, vice versa. 

Section 4.10    Payment of Expenses. Except as otherwise provided in this
Agreement, the Inter-Company Agreements or any other agreement between the Parties relating to the IPO, (i) all costs and expenses of the Parties in connection with the IPO (including costs associated with drafting this Agreement, the
Inter-Company Agreements and the documents relating to the formation of Youdao and its subsidiaries and VIEs) shall be paid by Youdao and (ii) all costs and expenses of the Parties in connection with any matter not relating to the IPO shall be
paid by the Party which incurs such cost or expense. Notwithstanding the foregoing, Youdao and NetEase shall each be responsible for their own internal fees, costs and expenses (e.g., salaries of personnel) incurred in connection with the IPO. 

ARTICLE 5 

MUTUAL RELEASES; INDEMNIFICATION 

Section 5.1    Release of Claims. 

(a)    Youdao Release. Except as provided in Section 5.1(c), Youdao, for itself and as agent for each of its
subsidiaries and VIEs, does hereby assume, and does hereby remise, release and forever discharge the NetEase Indemnitees from, any and all Liabilities whatsoever, whether at law or in equity (including any right of contribution), whether arising
under any contract or agreement, by operation of law or otherwise, existing or arising from any past acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any conditions existing or alleged to have
existed on or before the Public Filing Date, including in connection with the transactions and all other activities to implement the IPO. 

(b)    NetEase Release. Except as provided in Section 5.1(c), NetEase, for itself and as agent for each of
its subsidiaries and VIEs, does hereby remise, release and forever discharge the Youdao Indemnitees from any and all Liabilities whatsoever, whether at law or in equity (including any right of contribution), whether arising under any contract or
agreement, by operation of law or otherwise, existing or arising from any past acts or events occurring or failing to occur or alleged to have occurred or to have failed to occur or any conditions existing or alleged to have existed on or before the
Public Filing Date, including in connection with the transactions and all other activities to implement the IPO. 

(c)    No Impairment. Nothing contained in Section 5.1(a) or Section 5.1(b) shall limit or otherwise
affect any Party’s rights or obligations pursuant to or contemplated by this Agreement or any Inter-Company Agreement, in each case in accordance with its terms, including, without limitation, any obligations relating to indemnification,
including indemnification pursuant to Section 5.2 and Section 5.3 of this Agreement. 

  
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Section 5.2    Indemnification by Youdao. Except as otherwise
provided in this Agreement, Youdao shall, for itself and as agent for each of its subsidiaries and VIEs, indemnify, defend (or, where applicable, pay the defense costs for) and hold harmless the NetEase Indemnitees from and against, and shall
reimburse the NetEase Indemnitees with respect to, any and all Losses that any third party seeks to impose upon the NetEase Indemnitees, or which are imposed upon the NetEase Indemnitees, and that relate to, arise or result from, whether prior to,
on or following the Public Filing Date, any of the following items (without duplication): 
 (a)    Youdao Liabilities;

 (b)    any breach by Youdao or any of its subsidiaries and VIEs of this Agreement or any of the Inter-Company
Agreements; and 
 (c)    any Liabilities relating to, arising out of or resulting from any untrue statement or alleged
untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, with respect to all information (i) contained in the IPO
Registration Statement, any issuer free writing prospectus or any preliminary, final or supplemental prospectus forming a part of the IPO Registration Statement (other than information provided in writing by NetEase or any of its subsidiaries or
VIEs to Youdao specifically for inclusion in the IPO Registration Statement, any issuer free writing prospectus or any preliminary, final or supplemental prospectus forming a part of the IPO Registration Statement), (ii) contained in any public
filings made by Youdao with the SEC following the Public Filing Date if and to the extent the provision of such information is not subject to indemnification pursuant to Section 5.3(c)(iii) below or (iii) provided in writing by Youdao or
its subsidiaries or VIEs to NetEase specifically for inclusion in NetEase’s annual, quarterly or current reports following the Public Filing Date to the extent (A) such information pertains to (x) Youdao or its subsidiaries or VIEs or
(y) the Online Learning Business and (B) NetEase has provided prior written notice to Youdao that such information will be included in one or more annual, quarterly or current reports, specifying how such information will be presented, and
the information is included in such annual, quarterly or current reports; provided that this sub-clause (B) shall not apply to the extent that any such Liability arises out of or results from, or in
connection with, any action or inaction of NetEase or any of its subsidiaries or VIEs, including as a result of any misstatement or omission of any information by NetEase or its subsidiaries or VIEs to Youdao. 

In the event that Youdao or any of its subsidiaries or VIEs makes a payment to the NetEase Indemnitees hereunder, and any of the NetEase
Indemnitees subsequently diminishes the Liability on account of which such payment was made, either directly or through a third-party recovery (other than a recovery indirectly from NetEase or its subsidiaries or VIEs), NetEase will promptly repay
(or will procure an NetEase Indemnitee to promptly repay) Youdao (or its Subsidiary or VIE that has made the payment) the amount by which the payment made by Youdao (or its Subsidiary or VIE that has made the payment) exceeds the actual cost of the
associated indemnified Liability. 
 Section 5.3    Indemnification by
NetEase. Except as otherwise provided in this Agreement, NetEase shall, for itself and as agent for each of its subsidiaries and VIEs, indemnify, defend (or, where applicable, pay the defense costs for) and hold harmless the Youdao
Indemnitees from and against, and shall reimburse each such Youdao Indemnitee with respect to, any and all Losses that any third party seeks to impose upon the Youdao Indemnitees or which are imposed upon the Youdao Indemnitees to the extent
relating to, arising from or resulting from, whether prior to, on or following the Public Filing Date, any of the following items (without duplication): 

  
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 (a)    NetEase Liabilities; 

(b)    any breach by NetEase or its subsidiaries or VIEs of this Agreement or any of the Inter-Company Agreements; and

 (c)    any Liabilities relating to, arising out of or resulting from any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, with respect to all information (i) contained in the IPO
Registration Statement, any issuer free writing prospectus or any preliminary, final or supplemental prospectus forming a part of the IPO Registration Statement and provided in writing by NetEase or any of its subsidiaries or VIEs to Youdao
specifically for inclusion in the IPO Registration Statement, any issuer free writing prospectus or any preliminary, final or supplemental prospectus forming a part of the IPO Registration Statement, (ii) contained in any public filings made by
NetEase with the SEC following the Public Filing Date if and to the extent the provision of such information is not subject to indemnification pursuant to Section 5.2(c)(iii) above or (iii) provided in writing by NetEase or its
subsidiaries or VIEs to Youdao specifically for inclusion in Youdao’s annual, quarterly or current reports following the Public Filing Date to the extent (A) such information pertains to (x) NetEase or any of its subsidiaries or VIEs
or (y) the NetEase Business and (B) Youdao has provided prior written notice to NetEase that such information will be included in one or more annual, quarterly or current reports, specifying how such information will be presented, and the
information is included in such annual, quarterly or current reports; provided that this sub-clause (B) shall not apply to the extent that any such Liability arises out of or results from, or in
connection with, any action or inaction of Youdao or any of its subsidiaries or VIEs, including as a result of any misstatement or omission of any information by Youdao or any of its subsidiaries or VIEs to NetEase. 

In the event that NetEase or any of its subsidiaries or VIEs makes a payment to the Youdao Indemnitees hereunder, and any of the Youdao
Indemnitees subsequently diminishes the Liability on account of which such payment was made, either directly or through a third-party recovery (other than a recovery indirectly from Youdao or its subsidiaries or VIEs), Youdao will promptly repay (or
will procure a Youdao Indemnitee to promptly repay) NetEase (or any of its Subsidiary or VIEs that has made the payment) the amount by which the payment made by NetEase (or any of its subsidiaries or VIEs that has made the payment) exceeds the
actual cost of the indemnified Liability. 
 Section 5.4    Procedures for
Defense, Settlement and Indemnification of the Third Party Claims. 
 (a)    Notice of Claims. If an
Indemnitee shall receive notice or otherwise learn of the assertion by a Person (including any Governmental Authority) other than NetEase, Youdao and their respective subsidiaries and VIEs of any claim or of the commencement by any such Person of
any Action (collectively, a “Third Party Claim”) with respect to which an Indemnifying Party may be obligated to provide indemnification, NetEase or Youdao, as applicable, will ensure that such Indemnitee shall give such
Indemnifying Party written notice thereof within thirty (30) calendar days after becoming aware of such Third Party Claim. Any such notice shall describe the Third Party Claim in reasonable detail. Notwithstanding the foregoing, the delay or
failure of any Indemnitee or other Person to give notice as provided in this Section 5.4 shall not relieve the related Indemnifying Party of its obligations under this Article 5, except to the extent that such Indemnifying Party is actually and
substantially prejudiced by such delay or failure to give notice. 

  
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 (b)    Defense by Indemnifying Party. An Indemnifying Party
shall be entitled to participate in the defense of any Third Party Claim and, to the extent that it wishes, at its cost, risk and expense, to assume the defense thereof, with counsel reasonably satisfactory to the Indemnitee, unless the Indemnifying
Party is also a party to such proceeding and the Indemnitee determines in good faith that joint representation would be materially prejudicial to the Indemnitee’s defense. After timely notice from the Indemnifying Party to the Indemnitee of
such election to so assume the defense thereof, the Indemnifying Party shall not be liable to the Indemnitee for any legal expenses of other counsel or any other expenses subsequently incurred by the Indemnitee in connection with the defense
thereof. The Indemnitee agrees to cooperate in all reasonable respects with the Indemnifying Party and its counsel in the defense against any Third Party Claim. The Indemnifying Party shall be entitled to compromise or settle any Third Party Claim
as to which it is providing indemnification, provided that any compromise or settlement shall be made only with the written consent of the Indemnitee, such consent not to be unreasonably withheld. 

(c)    Defense by Indemnitee. If an Indemnifying Party fails to assume the defense of a Third Party Claim within
thirty (30) calendar days after receipt of notice of such claim, the Indemnitee will, upon delivering notice to such effect to the Indemnifying Party, have the right to undertake the defense, compromise or settlement of such Third Party Claim
on behalf of and for the account of the Indemnifying Party subject to the limitations as set forth in this Section 5.4; provided, however, that such Third Party Claim shall not be compromised or settled without the written consent of the
Indemnifying Party, which consent shall not be unreasonably withheld. If the Indemnitee assumes the defense of any Third Party Claim, it shall keep the Indemnifying Party reasonably informed of the progress of any such defense, compromise or
settlement. The Indemnifying Party shall reimburse all such costs and expenses of the Indemnitee in the event it is ultimately determined that the Indemnifying Party is obligated to indemnify the Indemnitee with respect to such Third Party Claim. In
no event shall an Indemnifying Party be liable for any settlement effected without its consent, which consent shall not be unreasonably withheld. 

Section 5.5    Additional Matters. 

(a)    Cooperation in Defense and Settlement. With respect to any Third Party Claim that implicates both Youdao and
NetEase in a material way due to the allocation of Liabilities, responsibilities for management of defense and related indemnities set forth in this Agreement or any of the Inter-Company Agreements, the Parties agree to cooperate fully and maintain
a joint defense (in a manner that will preserve the attorney-client privilege, joint defense or other privilege with respect thereto) so as to minimize such Liabilities and defense costs associated therewith. Any Party that is not responsible for
managing the defense of such Third Party Claims shall, upon reasonable request, be consulted with respect to significant matters relating thereto and may, if necessary or helpful, engage counsel to assist in the defense of such claims. 

  
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 (b)    Subrogation. In the event of payment by or on behalf of
any Indemnifying Party to or on behalf of any Indemnitee in connection with any Third Party Claim, such Indemnifying Party shall be subrogated to and shall stand in the place of such Indemnitee, in whole or in part based upon whether the
Indemnifying Party has paid all or only part of the Indemnitee’s Liability, as to any events or circumstances in respect of which such Indemnitee may have any right, defense or claim relating to such Third Party Claim against any claimant or
plaintiff asserting such Third Party Claim or against any other person. Such Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner, and at the cost and expense of such Indemnifying Party, in prosecuting any subrogated right,
defense or claim. 
 Section 5.6    Survival of Indemnities. The rights
and obligations of the Parties under this Article 5 shall survive the sale or other transfer by any Party of any of its assets or businesses or the assignment by it of any Liabilities or the acquisition of Control of such Party (by sale of capital
stock or other equity interests, merger, consolidation or otherwise). 
 ARTICLE 6 

DISPUTE RESOLUTION 

Section 6.1    Dispute Resolution. Any dispute, controversy, difference or
claim arising out of or relating to this Agreement, including the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising
out of or relating to it (“Dispute”) which arises between the Parties shall first be negotiated between appropriate senior executives of each Party who shall have the authority to resolve the matter. Such executives shall meet to
attempt in good faith to negotiate a resolution of the Dispute prior to pursuing other available remedies, within ten (10) calendar days of receipt by a Party of written notice of a Dispute, which date of receipt shall be referred to herein as
the “Dispute Resolution Commencement Date.” Discussions and correspondence relating to trying to resolve such Dispute shall be conducted on a without prejudice basis, treated as Confidential Information, shall be exempt from
discovery or production, and shall not be admissible in any subsequent proceeding between the Parties. 
 (a)    If the
senior executives are unable to resolve the Dispute within sixty (60) calendar days from the Dispute Resolution Commencement Date, the exclusive means of continuing to pursue resolution of the the Dispute is to submit the Dispute to the boards
of directors of NetEase and Youdao. Representatives of each board of directors shall meet as soon as practicable to attempt in good faith to negotiate a resolution of the Dispute. 

(b)    If the representatives of the two boards of directors are unable to resolve the Dispute within 120 calendar days
from the Dispute Resolution Commencement Date, the exclusive means of continuing to pursue resolution of the Dispute is for any Party to initiate mediation pursuant to the Commercial Mediation Procedures of the American Arbitration Association,
which shall apply to the conduct of the mediation, including the method of appointment of a mediator. Both Parties will share the administrative costs of the mediation and the mediator’s fees and expenses equally, and each Party shall bear all
of its other costs and expenses related to the mediation, including but not limited to attorney’s fees, witness fees, and travel expenses. The mediation shall take place in English in Beijing, China or in whatever alternative forum on which the
Parties may agree. 

  
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 (c)    If the Parties cannot resolve any Dispute through mediation
within forty-five (45) calendar days after the appointment of the mediator (or the earlier withdrawal thereof), the exclusive means of pursuing final resolution of the Dispute is for any Party to commence an arbitration administered by the Hong
Kong International Arbitration Centre under the Hong Kong International Arbitration Centre Administered Arbitration Rules (the “HKIAC Rules”) in force at the time when the notice of arbitration is submitted. There shall be three
(3) arbitrators selected pursuant to the HKIAC Rules. The presiding arbitrator shall be qualified to practice law in New York. The place and seat of arbitration shall be Hong Kong. The law of this arbitration clause shall be Hong Kong law. The
award of the arbitral tribunal shall be final and binding upon the parties thereto, and the prevailing party may apply to a court of competent jurisdiction for enforcement of such award. Nothing contained herein shall preclude any Party from seeking
provisional, interim or conservatory measures (including injunctive relief) from any court of competent jurisdiction. 
 Unless otherwise
agreed in writing, the Parties will continue to provide service and honor all other commitments under this Agreement and each Inter-Company Agreement during the course of dispute resolution pursuant to the provisions of this Section 6.1 with
respect to all matters not subject to such Dispute, controversy or claim. 
 ARTICLE 7 

MISCELLANEOUS 
 
Section 7.1    Consent. Any consent of a Party pursuant to this Agreement or any of the Inter-Company Agreements shall not be effective unless it is in writing and evidenced by the signature of the Chief Executive
Officer or Chief Financial Officer of such Party (or such other person that the Chief Executive Officer, Chief Financial Officer or board of directors of such Party has specifically authorized in writing to give such consent). 

Section 7.2    Limitation of Liability. IN NO EVENT SHALL NETEASE OR ANY
OTHER MEMBER OF THE NETEASE GROUP OR YOUDAO OR ANY OTHER MEMBER OF THE YOUDAO GROUP BE LIABLE TO THE OTHER PARTY, OR ITS AFFILIATED COMPANIES FOR ANY LOST PROFITS OR CONSEQUENTIAL, INDIRECT, PUNITIVE, EXEMPLARY, SPECIAL, OR INCIDENTAL DAMAGES,
HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED, HOWEVER, THAT TO THE EXTENT EITHER PARTY OR ITS
RESPECTIVE AFFILIATES IS REQUIRED TO PAY ANY LOST PROFITS OR CONSEQUENTIAL, INDIRECT, PUNITIVE, EXEMPLARY, SPECIAL, OR INCIDENTAL DAMAGES TO A THIRD PARTY WHO IS NOT AN AFFILIATE OF EITHER PARTY, IN EACH CASE IN CONNECTION WITH A THIRD-PARTY CLAIM,
SUCH DAMAGES WILL CONSTITUTE DIRECT DAMAGES OF THE INDEMNIFIED PARTY AND WILL NOT BE SUBJECT TO THE LIMITATION SET FORTH IN THIS SECTION. SUBJECT TO THE FOREGOING, NOTHING IN THIS AGREEMENT LIMITS A PARTY’S RIGHT TO SEEK REMEDIES THAT SUCH
PARTY IS ENTITLED TO FOR ANY BREACH OF THIS AGREEMENT, WHETHER AT LAW OR IN EQUITY, INCLUDING WITHOUT LIMITATION THE RIGHT TO TERMINATE THIS AGREEMENT IN THE EVENT THAT THE OTHER PARTY MATERIALLY BREACHES THIS AGREEMENT. 

  
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Section 7.3    Termination. This Agreement may be terminated by mutual
consent of the Parties, evidenced by an instrument in writing signed on behalf of each of the Parties. In the event of termination pursuant to this Section 7.3, no Party shall have any liability of any kind to the other Party resulting from
such termination. This Agreement shall terminate on the date that is five (5) years after the Control Ending Date; provided, however, that (i) the provisions of Section 4.7 shall survive for a period of seven
(7) years after the termination of this Agreement, and (ii) the provisions of Section 4.5, Article 5, Article 6 and Article 7 shall survive indefinitely after the termination of this Agreement. For avoidance of doubt, the termination
of this Agreement shall not affect the validity and effectiveness of the Inter-Company Agreements. 

Section 7.4    Amendment. This Agreement may not be amended except by an
instrument in writing executed by a duly authorized representative of each Party. 

Section 7.5    Notices. Notices, offers, requests or other communications
required or permitted to be given by a Party pursuant to the terms of this Agreement shall be given in writing to the other Party to the addresses set forth in Schedule 1 hereto, or to such other address, facsimile number or email address as
the Party to whom notice is given may have previously furnished to the other in writing as provided herein. Any notice involving non-performance or termination shall be sent by hand delivery or recognized
courier. All other notices may also be sent by facsimile or email, confirmed by mail. All notices shall be deemed to have been given when received, if hand delivered; when transmitted, if transmitted by facsimile or email; upon confirmation of
delivery, if sent by recognized courier; and upon receipt if mailed. 

Section 7.6    Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, U.S.A. 

Section 7.7    Authority. Each of the Parties hereto represents to the
others that (a) it has the corporate or other requisite power and authority to execute, deliver and perform this Agreement, (b) the execution, delivery and performance of this Agreement by it have been duly authorized by all necessary
corporate or other actions, (c) it has duly and validly executed and delivered this Agreement, and (d) this Agreement is a legal, valid and binding obligation, enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and general equity principles. 

Section 7.8    Specific Performance. The Parties hereto agree that
irreparable damage would occur if any provisions of this Agreement were not performed in accordance with the terms hereof and that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce
specifically the performance of the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity. 

Section 7.9    Entire Agreement. This Agreement, the Inter-Company
Agreements and the Exhibits and Schedules referenced or attached hereto and thereto constitute the entire agreement between the Parties with respect to the subject matter hereof and thereof and supersede all previous agreements, negotiations,
discussions, writings, understandings, commitments and conversations with respect to the subject matter hereof and thereof. 

  
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Section 7.10    Severability. If any term of this Agreement or the Schedule
attached hereto is determined by a court, administrative agency or arbitrator to be invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain
in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal
or incapable of being enforced, the Parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that transactions contemplated
hereby are fulfilled to the fullest extent possible. 

Section 7.11    Failure or Indulgence not Waiver; Remedies Cumulative. No
failure or delay on the part of any Party hereto in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty or agreement herein, nor shall any
single or partial exercise of any such right preclude other or further exercise thereof or of any other right. All rights and remedies existing under this Agreement, the Inter-Company Agreements and the Exhibits and Schedules referenced or attached
hereto and thereto are cumulative to, and not exclusive of, any rights or remedies otherwise available. 

Section 7.12    Binding Effect; Assignment. This Agreement shall inure to
the benefit of and be binding upon the Parties hereto and their respective legal representatives and successors, and nothing in this Agreement, express or implied, is intended to confer upon any other Person any rights or remedies of any nature
whatsoever under or by reason of this Agreement. No Party may assign this Agreement or any rights or obligations hereunder, without the prior written consent of the other Party, and any such assignment shall be void; provided, however, that each
Party may assign this Agreement to an Affiliate. 
 Section 7.13    No Third
Party Beneficiaries. None of the provisions of this Agreement shall be for the benefit of or enforceable by any third party, including any creditor of any Person. No such third party shall obtain any right under any provision of this Agreement
or shall by reasons of any such provision make any claim in respect of any Liability (or otherwise) against either Party hereto. 
 
Section 7.14    Inconsistency. None of the provisions of this Agreement is intended to supersede any provision in any Inter-Company Agreement or any other agreement with respect to the respective subject matters
thereof. In the event of conflict between this Agreement and any Inter-Company Agreement or other agreement executed in connection herewith, the provisions of such other agreement shall prevail. 

Section 7.15    Heading. The headings contained in this Agreement or in the
Schedule attached hereto and in the table of contents to this Agreement are for reference purposes only and shall not in any way limit or affect the meaning or interpretation of any of the terms in this Agreement. 

Section 7.16    Interpretation. For all purposes of this Agreement:
(i) all references in this Agreement to designated “Sections” and other subdivisions are to the designated Sections and other subdivisions of the body of this Agreement unless otherwise indicated; (ii) the words
“herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision; (iii) “or” is not exclusive; (iv)
“including” and “includes” will be deemed to be followed by “but not limited to” and “but is not limited to”, respectively; (v) any definition of, or reference to, any law, agreement, instrument or other
document herein will be construed as referring to such law, agreement, instrument or other document as from time to time amended, supplemented or otherwise modified; and (vi) any definition of, or reference to, any statute will be construed as
referring also to any rules and regulations promulgated thereunder. 

  
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Section 7.17    Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means will
be effective as delivery of a manually executed counterpart of this Agreement. 
 [Signature page follows] 

  
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 IN WITNESS WHEREOF, the Parties hereto, each acting under due and proper authority,
have executed this Agreement as of the day, month and year first above written. 
  

			
	NetEase, Inc.
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	Youdao, Inc.
		
	By:	 	  

	Name:	 	
	Title:	 	

 [Signature Page to Master Transaction Agreement] 

Table of Contents

 SCHEDULE 1 

NOTICE ADDRESSES

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