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TABLE OF CONTENTS
Gridsum Holding Inc. Index to Consolidated Financial Statements

As filed with the Securities and Exchange Commission on August 26, 2016

Registration No. 333-            

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

Gridsum Holding Inc.
(Exact name of Registrant as specified in its charter)

Not Applicable
(Translation of Registrant's name into English)

Cayman Islands
(State or other jurisdiction of
incorporation or organization) 7372
(Primary Standard Industrial
Classification Code Number) Not Applicable
(I.R.S. Employer
Identification Number)

Jade Palace Hotel Office Building, 8^th Floor
76 Zhichun Road
Haidian District, Beijing 100086
People's Republic of China
(86-10) 8261-9988
(Address, including zip code and telephone number, including area code, of Registrant's principal executive offices)

Law Debenture Corporate Services Inc.
4th Floor, 400 Madison Avenue
New York, New York 10017
(212) 750-6474
(Name, address, including zip code and telephone number, including area code, of agent for service)

Copies to:
Gordon K. Davidson, Esq. Horace L. Nash, Esq. Fenwick & West LLP 801 California Street Mountain View, CA 94041 United States of America (650) 988-8500	Niping Wu, Esq. Eva H. Wang, Esq. Fenwick & West LLP Unit 908, 1155 Fang Dian Road Pudong, Shanghai 201204 People's Republic of China (86-21) 8017-1200	Chris K.H. Lin, Esq. Daniel Fertig, Esq. Simpson Thacher & Bartlett LLP c/o 35th Floor, ICBC Tower 3 Garden Road Central Hong Kong (852) 2514-7600

Approximate date of commencement of proposed sale to the public:
as soon as practicable after the effective date of this registration statement.

          If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

          If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Proposed maximum aggregate offering price(1)	Amount of registration fee
Class B ordinary shares, US$0.001 par value per share(2)(3)	US$75,000,000	US$7,552.50

(1)

Estimated solely for the purpose of determining the amount of registration fee in accordance with Rule 457(o) under the Securities Act of 1933.

(2)

Includes Class B ordinary shares initially offered and sold outside the United States that may be resold from time to time in the United States either as part of their distribution or within 40 days after the later of the effective date of this registration statement and the date the shares are first bona fide offered to the public, and also includes Class B ordinary shares that may be purchased by the underwriters pursuant to an option to purchase additional shares. These Class B ordinary shares are not being registered for the purpose of sales outside the United States.

(3)

American depositary shares issuable upon deposit of the Class B ordinary shares registered hereby will be registered under a separate registration statement on Form F-6 (Registration No. 333-            ). Each American depositary share represents                         Class B ordinary shares.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to Completion. Dated                        , 2016.

American Depositary Shares

Gridsum Holding Inc.

Representing                Class B Ordinary Shares

        This is an initial public offering of American depositary shares, or ADSs, of Gridsum Holding Inc.

        We are offering                        ADSs. Each ADS represents                        Class B ordinary shares, US$0.001 par value per share. We anticipate the initial public offering price of the ADSs will be between US$                        and US$                        per ADS.

        Prior to this offering, there has been no public market for the ADSs or our Class B ordinary shares. We have applied to list the ADSs on the NASDAQ Global Market under the symbol "GSUM."

        We are an "emerging growth company" under applicable U.S. federal securities laws and are eligible for reduced public company reporting requirements.

See "Risk Factors" beginning on page 13 for factors you should consider before buying the ADSs.

Neither the United States Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

	Per ADS	Total
Initial public offering price	US$	US$
Underwriting discounts and commissions	US$	US$
Proceeds, before expenses, to us	US$	US$

        To the extent we sell more than                        ADSs in this offering, the underwriters have a 30-day option to purchase up to an additional                        ADSs from us at the initial public offering price less underwriting discounts and commissions.

        Upon the completion of this offering, 4,543,461 Class A ordinary shares and                                    Class B ordinary shares will be issued and outstanding. Holders of Class A ordinary shares and Class B ordinary shares will have the same rights except for voting and conversion rights. Each Class A ordinary share will be entitled to ten votes and will be convertible into one Class B ordinary share, and each Class B ordinary share will be entitled to one vote. Accordingly, Guosheng Qi, our chief executive officer and chairman, the sole holder of our Class A ordinary shares, will hold                                    of our aggregate ordinary shares and            % of our aggregate voting power. Holders of our Class B ordinary shares will hold            % of our ordinary shares and            % of our aggregate voting power.

        The underwriters expect to deliver the ADSs against payment in U.S. Dollars in New York, New York on                        , 2016.

Goldman Sachs (Asia) L.L.C.	Citigroup
Stifel

        Prospectus dated                        , 2016

TABLE OF CONTENTS

	Page
Prospectus Summary	1
Risk Factors	13
Special Note Regarding Forward-Looking Statements and Industry Data	42
Use of Proceeds	43
Dividend Policy	44
Capitalization	45
Dilution	47
Exchange Rate Information	49
Enforceability of Civil Liabilities	50
Corporate History and Structure	51
Selected Consolidated Financial Data	55
Management's Discussion and Analysis of Financial Condition and Results of Operations	58
Business	87
PRC Regulation	109
Management	117
Principal Shareholders	126
Related Party Transactions	129
Description of Share Capital	130
Description of American Depositary Shares	141
Shares Eligible for Future Sale	153
Taxation	155
Underwriting (Conflicts of Interest)	162
Expenses Related to This Offering	169
Legal Matters	170
Experts	171
Where You Can Find Additional Information	172
Index to Consolidated Financial Statements	F-1

        You should rely only on the information contained in this prospectus or in any related free-writing prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus or in any related free-writing prospectus. We are offering to sell, and seeking offers to buy, the ADSs only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is current only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the ADSs.

        We have not taken any action to permit a public offering of the ADSs outside the United States or to permit the possession or distribution of this prospectus outside the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about and observe any restrictions relating to the offering of the ADSs and the distribution of the prospectus outside the United States.

Until                        , 2016 (the 25th day after the date of this prospectus), all dealers that buy, sell or trade ADSs, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

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PROSPECTUS SUMMARY

The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in the ADSs discussed under "Risk Factors," before deciding whether to buy the ADSs.

Our Business

        Gridsum is a leading provider of sophisticated data analysis software for multinational and domestic enterprises and government agencies in China. Our proprietary distributed data architecture allows our customers to efficiently collect and analyze vast amounts of information that is collected, indexed and stored in an organized manner, or structured data, and information that is not organized, or unstructured data. Our core technology, the Gridsum Big Data Platform, with its machine learning capability, performs multi-dimensional correlation analysis and analyzes complex real-time events. With the support of our Big Data Platform, our customers use our data visualization and data-mining technologies to identify complex relationships within their data and gain new insights that help them make better business decisions.

        Our leading position is based on our solutions and our core technologies. Our software products are designed for a variety of commercial and governmental applications. To help our enterprise customers reach China's large and growing online and mobile population, our initial products have focused on digital marketing analytics and automation solutions. We were among the first companies to offer web analytics solutions based on data warehouse technology, and we were among the first digital intelligence companies in China to build solutions entirely on a distributed data warehouse architecture using the open-source Hadoop framework. In addition, we believe we are the only China-based company to provide solutions to enterprise customers that cover web, video and mobile analytics. Our solutions analyze data from approximately 61 million internet and mobile sessions per day from users operating on over 233 million desktop and mobile devices. By leveraging the analytic capabilities of our Big Data Platform, we have developed additional software solutions, including new media analytics and information discovery solutions, to address a broad range of customer needs. In 2015, our customers included Fortune 500 and China 500 enterprises, comprising more than 300 customers across diverse industries, including over 30 Chinese government agencies.

        We have grown rapidly in recent periods, with net revenues in 2013, 2014 and 2015 of RMB62.5 million, RMB124.5 million and RMB234.8 million (US$35.3 million), respectively, representing year-over-year growth of 99% and 89%, respectively, and net revenues in the six months ended June 30, 2015 and 2016 of RMB84.6 million and RMB148.1 million (US$22.3 million), respectively, representing period-over-period growth of 75%. We have continued to make expenditures and investments, including in our technologies, personnel, sales and marketing, infrastructure and operations, and incurred net losses of RMB30.7 million, RMB37.3 million, RMB48.8 million (US$7.3 million) and RMB29.7 million (US$4.5 million) in 2013, 2014, 2015 and the six months ended June 30, 2016, respectively. Our customers increased in number from 141 in 2013 to 211 in 2014 and 307 in 2015, and over the same period, our average customer contribution increased 33% and 30% year over year. We enjoy high customer loyalty and revenue retention, with 168%, 116% and 138% revenue retention rates in 2013, 2014 and 2015, respectively. We calculate average customer contribution by dividing total net revenues in a period by total number of customers in the same period. Our revenue retention rate consists of aggregate net revenues from all customers in the prior period that remain customers in the current period, divided by total net revenues from all customers in that prior period.

Key Advantages of our Solutions

        We deliver our solutions as cloud-based software-as-a-service, or SaaS, offerings that are easy to deploy, easy to access, automatically updated without disruption, and enable our customers to reduce

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IT support costs by outsourcing hardware and software maintenance and support. The key advantages of our solutions include:

•

fast and efficient multi-dimensional drill-down that enables customers to derive valuable intelligence from both structured and unstructured data quickly and easily;

•

simple, customizable visualization that is intuitive and user-friendly;

•

fully integrated solution suites that share a common user interface accessible across all screen formats;

•

easy and rapid deployment, without specialized training requirements, and ready integration with customers' management and operating systems;

•

lower total cost of ownership without investment in additional hardware or IT infrastructure; and

•

designed with the China market in mind and readily customizable for the needs of specific enterprise customers.

Our Core Technology

        We offer suites of solutions that are built on our core technology. These end-to-end solution suites address customer needs in marketing automation, e-Government, new media, information discovery and visualization. Our solutions and core technologies are built on our distributed data warehouse architecture using the open-source Hadoop framework. Our data architecture offers high scalability and high performance characteristics. Our core technology consists of our data visualization and interactive data mining technologies, the Gridsum Big Data Platform and our data acquisition and data pre-processing technologies.

Our Competitive Strengths

        Our mission is to help enterprises and government organizations in China use data in new and powerful ways to make better informed decisions and be more productive. The competitive strengths that we believe enable us to achieve our mission include:

•

our position as a digital intelligence pioneer;

•

powerful cumulative data assets;

•

our diversified customer base;

•

high customer loyalty and revenue retention;

•

scalable business model; and

•

experienced and visionary management team.

Our Growth Strategy

        In order to grow our business and to fulfill our mission, we have implemented a number of key strategies, including:

•

continuing to innovate;

•

increasing market penetration;

•

growing our customer base; and

•

expanding our share of customer IT and marketing budgets.

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Corporate History and Structure

        We commenced operations in December 2005 with the establishment of Beijing Gridsum Technology Co., Ltd., or Beijing Gridsum, in China. We have established five additional operating companies: Beijing Moment Everlasting Ad Co., Ltd., in January 2011, and its wholly owned subsidiary, Beijing Yunyang Ad Co., Ltd., in March 2013, Guoxinjunhe (Beijing) Technology Co., Ltd., in April 2012, Beijing Guoxinwangyan Technology Co., Ltd., in August 2015, and Beijing Gridsum Yizhun Technology Co., Ltd., in February 2016. We refer to these operating companies as Beijing Moment, Beijing Yunyang, Guoxinjunhe, Beijing Guoxinwangyan and Beijing Yizhun, respectively.

        From July to December 2014, we undertook a reorganization of our group of companies in preparation for our proposed initial public offering in the United States. We incorporated Gridsum Holding Inc., or Gridsum Cayman, under the laws of the Cayman Islands on July 21, 2014, as the parent holding company of our group of related companies. Gridsum Cayman established a wholly-owned subsidiary in Hong Kong, Gridsum Holding (China) Limited, or Gridsum HK, which in turn established a wholly owned subsidiary in the PRC, Dissector (Beijing) Technology Co., Ltd., which we refer to as the WFOE. Also as part of this reorganization, we established Gridsum Holding (Beijing) Co., Ltd., or Gridsum PRC Holding, in China, which acquired full ownership of Beijing Gridsum, Beijing Moment and Guoxinjunhe. The beneficial owners of Gridsum PRC Holding are our founders, Guosheng Qi and Guofa Yu, and other key employees.

        To comply with applicable PRC laws and regulations, we conduct our operations in China principally through Beijing Gridsum, Guoxinjunhe, Beijing Moment, Beijing Yunyang, Beijing Guoxinwangyan and Beijing Yizhun, all of which are subsidiaries of Gridsum PRC Holding. The WFOE has entered into a series of contractual arrangements with Gridsum PRC Holding, the parent of our PRC operating companies, and the shareholders of Gridsum PRC Holding. These contractual arrangements allow us to exercise effective control over Gridsum PRC Holding and receive substantially all of the economic benefits of Gridsum PRC Holding. As a result, we are the primary beneficiary of Gridsum PRC Holding and treat it as our variable interest entity, or VIE, under accounting principles generally accepted in the United States, or U.S. GAAP. We have consolidated the financial results of Gridsum PRC Holding and its subsidiaries in our consolidated financial statements.

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        The following diagram illustrates our corporate structure, including our significant subsidiaries, our consolidated VIE and its subsidiaries:

Implications of Status as an Emerging Growth Company

        As a company with less than US$1.0 billion in revenues for our last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specific reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the required auditor attestation of the emerging growth company's internal controls. The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. However, we have elected to "opt out" of this provision, and as a result we will comply with new or revised accounting standards when they are adopted and compliance is required for public companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable.

        We will remain an emerging growth company until the earliest of: the last day of our fiscal year during which we have total annual gross revenues of at least US$1.0 billion; the last day of our fiscal year following the fifth anniversary of the completion of this offering; the date on which we have,

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during the previous three-year period, issued more than US$1.0 billion in non-convertible debt; or the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended, which would occur on the first day of our next fiscal year after the market value of the ADSs held by non-affiliates exceeds US$700 million as of the last business day of our most recently completed second fiscal quarter. Once we cease to be an emerging growth company, we will no longer be entitled to the exemptions provided in the JOBS Act discussed above.

Corporate Information

        Our principal executive offices are located at Jade Palace Hotel Office Building, 8^th Floor, 76 Zhichun Road, Haidian District, Beijing, People's Republic of China. Our telephone number at this address is (86-10) 8261-9988. Our registered office in the Cayman Islands is located at the offices of International Corporation Services Ltd., Harbour Place 2nd Floor, 103 South Church Street, P.O. Box 472, George Town, Grand Cayman KY1-1106. Our agent for service of process in the United States is Law Debenture Corporate Services Inc., located at 4th Floor, 400 Madison Avenue, New York, New York 10017.

        Investors should contact us for any inquiries through the address and telephone number of our principal executive offices. Our website is www.gridsum.com. The information contained on our website is not a part of this prospectus.

        GRIDSUM, the term "Dissector," the slogan "Empower your e-performance," and our other registered or unregistered trade names, trademarks or service marks appearing in this prospectus are our intellectual property. This prospectus also contains trade names, trademarks and service marks of other companies that are the property of their respective owners.

Conventions That Apply to this Prospectus

        Except where the context otherwise requires and for purposes of this prospectus only:

•

"ADSs" refers to our American depositary shares, and each ADS represents                         Class B ordinary shares;

•

"China" and "PRC" refer to the People's Republic of China, excluding Taiwan, Hong Kong and Macau;

•

"RMB" and "Renminbi" refer to the legal currency of the People's Republic of China;

•

"shares" and "ordinary shares" refer to our Class A and Class B ordinary shares, US$0.001 par value per share;

•

"US$" and "U.S. Dollar" refer to the legal currency of the United States; and

•

"we," "us," and "our company" refer to Gridsum Holding Inc., a Cayman Islands company, and its predecessor Cayman Islands entity, subsidiaries and consolidated affiliated entities.

        We use RMB as our reporting currency in our financial statements and in this prospectus. This prospectus contains translations of RMB amounts into U.S. Dollars at specific rates solely for the convenience of the readers. Unless otherwise noted, any RMB amounts are translated into U.S. Dollars at the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on June 30, 2016, which was RMB6.6459 to US$1.00. We make no representation that any RMB or U.S. Dollar amounts could have been, or could be, converted into U.S. Dollars or RMB, as the case may be, at any particular rate, at the rate stated above, or at all. The exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on August 19, 2016 was RMB6.6515 to US$1.00. See "Exchange Rate Information."

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THE OFFERING

Offering price	We currently estimate that the initial public offering price will be between US$            and US$            per ADS.
ADSs offered	ADSs
ADSs to Class B ordinary share ratio	Each ADS represents            Class B ordinary shares, US$0.001 par value per share.
ADSs outstanding immediately after this offering	ADSs (or                 ADSs if the underwriters exercise their option to purchase additional ADSs in full).
Ordinary shares outstanding immediately after this offering	4,543,461 Class A ordinary shares and                Class B ordinary shares (or 4,543,461 Class A ordinary shares and                Class B ordinary shares if the underwriters exercise their option to purchase additional ADSs in full).
The ADSs	Each ADS represents                Class B ordinary shares. The depositary will be the holder of the Class B ordinary shares underlying the ADSs and you will have the rights of an ADS holder as provided in the deposit agreement among us, the depositary and owners and beneficial owners of ADSs from time to time. You may surrender the ADSs to the depositary to withdraw the Class B ordinary shares underlying your ADSs. The depositary will charge you fees for such exchange. We may amend or terminate the deposit agreement without your consent. If an amendment becomes effective, you will be bound by the deposit agreement as amended if you continue to hold your ADSs. To better understand the terms of the ADSs, you should carefully read the "Description of American Depositary Shares" section of this prospectus. You should also read the deposit agreement, which is filed as an exhibit to the registration statement that includes this prospectus.
Option to purchase additional ADSs	We have granted to the underwriters an option, exercisable within 30 days from the date of this prospectus, to purchase up to an additional                ADSs.

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Use of proceeds	We expect that we will receive net proceeds from this offering of approximately US$           million, or approximately US$           million if the underwriters exercise their option to purchase additional ADSs from us in full, assuming an initial public offering price of US$           per ADS, the midpoint of the price range set forth on the cover of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds to invest in technology, infrastructure and product development, to expand sales and marketing efforts, and for working capital and other general corporate purposes. See "Use of Proceeds" for more information.
NASDAQ symbol	"GSUM"
Depositary	Citibank, N.A.
Lock-up	We, our directors and executive officers, certain of our existing shareholders and option holders have agreed with the underwriters not to sell, transfer or dispose of any ADSs, ordinary shares or similar securities for a period of 180 days after the date of this prospectus, subject to certain exceptions. In addition, we will not authorize or permit Citibank, N.A., as depositary, to accept any deposit of any Class B ordinary shares or issue any ADSs for 180 days after the date of this prospectus unless we expressly consent to such deposit or issuance and we have agreed not to provide such consent without the prior written consent of Goldman Sachs (Asia) L.L.C. and Citigroup Global Markets Inc. The foregoing does not affect the right of ADS holders to cancel their ADSs and withdraw the underlying Class B ordinary shares. See "Shares Eligible for Future Sale" and "Underwriting (Conflicts of Interest)."
Risk factors	See "Risk Factors" and other information included in this prospectus for a discussion of risks you should carefully consider before investing in the ADSs.

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Conflict of Interest Certain affiliates of Goldman Sachs (Asia) L.L.C. beneficially own 10% or more of our ordinary shares. Goldman Sachs (Asia) L.L.C. is an underwriter in this offering and Goldman, Sachs & Co. will be deemed to have a "conflict of interest" within the meaning of Rule 5121 of the Financial Industry Regulatory Authority, Inc. Accordingly, this offering will be made in compliance with the applicable provisions of Rule 5121, which requires that a "qualified independent underwriter" meeting certain standards participate in the preparation of the registration statement and prospectus and exercise the usual standards of due diligence with respect thereto. Citigroup Global Markets Inc. has agreed to act as a "qualified independent underwriter" within the meaning of Rule 5121 in connection with this offering. Goldman, Sachs & Co. will not confirm sales of the shares to any account over which they exercise discretionary authority without the prior written approval of the customer.

        The number of ordinary shares that will be outstanding immediately after this offering is based upon 4,543,461 Class A ordinary shares and 17,486,705 Class B ordinary shares outstanding as of the date of this prospectus, assuming the conversion of all outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering, and excluding:

•

2,468,661 Class B ordinary shares issuable upon the exercise of outstanding options at a weighted average exercise price of US$0.42 per share;

•

31,339 Class B ordinary shares reserved for future issuance under our 2014 Stock Option Plan; and

•

2,500,000 Class B ordinary shares reserved for future issuance under our 2016 Equity Incentive Plan.

        Except as otherwise indicated, all information in this prospectus assumes:

•

the automatic conversion of all outstanding preferred shares into Class B ordinary shares immediately upon the completion of this offering;

•

the filing and effectiveness of our fifth amended and restated memorandum and articles of association, which will become effective upon the completion of this offering; and

•

no exercise of the underwriters' option to purchase additional ADSs.

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SUMMARY CONSOLIDATED FINANCIAL DATA

        The following summary consolidated statements of operations data for the years ended December 31, 2013, 2014 and 2015, and summary consolidated balance sheet data as of December 31, 2013, 2014 and 2015, have been derived from our audited consolidated financial statements included elsewhere in this prospectus.

        The following summary consolidated statements of operations data for the six months ended June 30, 2015 and 2016, and summary consolidated balance sheet data as of June 30, 2016, have been derived from our unaudited interim consolidated financial statements included elsewhere in this prospectus. The unaudited interim consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements and include all adjustments, consisting of normal and recurring adjustments, that we consider necessary for a fair statement of our financial position and operating results for the periods presented. Results for the six months ended June 30, 2016 are not necessarily indicative of results that may be expected for the full year.

        You should read this Summary Consolidated Financial Data section together with our consolidated financial statements and the related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this prospectus. Our consolidated financial statements are prepared in accordance with U.S. GAAP. Our historical results are not necessarily indicative of results expected for future periods.

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands, except for share, per share and per ADS data)
Consolidated Statements of Operations Data:
Revenues:
Enterprise		57,025			104,891			208,157			31,321			75,483			133,918			20,150
e-Government and other		6,414			21,340			29,467			4,434			10,029			16,648			2,505
Less: Business tax and surcharges		(892	)		(1,711	)		(2,785	)		(419	)		(878	)		(2,499	)		(376	)
Net revenues		62,547			124,520			234,839			35,336			84,634			148,067			22,279
Cost of revenues(1)		(13,810	)		(21,143	)		(35,237	)		(5,302	)		(11,500	)		(20,023	)		(3,013	)
Gross profit		48,737			103,377			199,602			30,034			73,134			128,044			19,266
Operating expenses:
Sales and marketing expenses(1)		(29,012	)		(46,880	)		(84,548	)		(12,722	)		(33,351	)		(52,214	)		(7,857	)
Research and development expenses(1)		(20,385	)		(38,137	)		(100,186	)		(15,075	)		(40,178	)		(66,956	)		(10,075	)
General and administrative expenses(1)		(30,276	)		(54,931	)		(60,540	)		(9,109	)		(27,861	)		(37,466	)		(5,637	)
Total operating expenses		(79,673	)		(139,948	)		(245,274	)		(36,906	)		(101,390	)		(156,636	)		(23,569	)
Loss from operations		(30,936	)		(36,571	)		(45,672	)		(6,872	)		(28,256	)		(28,592	)		(4,303	)
Other income/(expense):
Foreign currency exchange gain/(loss)		296			(766	)		1,339			201			672			(889	)		(134	)
Interest income, net		87			180			80			12			26			189			28
Other income, net		9			373			111			17			—			(417	)		(63	)
Loss before income tax		(30,544	)		(36,784	)		(44,142	)		(6,642	)		(27,558	)		(29,709	)		(4,472	)
Income tax expense		(130	)		(476	)		(4,693	)		(706	)		—			—			—
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)
Less: Net loss attributable to noncontrolling interests		—			—			(16	)		(2	)		—			(27	)		(4	)
Net loss attributable to Gridsum Holding Inc.		(30,674	)		(37,260	)		(48,819	)		(7,346	)		(27,558	)		(29,682	)		(4,468	)
Accretion to preferred shares redemption value		(3,849	)		(9,480	)		(19,707	)		(2,965	)		(9,131	)		(11,050	)		(1,663	)
Cumulative dividend to preferred shareholders(2)		(8,215	)		(16,327	)		(16,642	)		(2,504	)		(8,240	)		(8,659	)		(1,303	)
Net loss attributable to Gridsum's ordinary shareholders(2)		(42,738	)		(63,067	)		(85,168	)		(12,815	)		(44,929	)		(49,391	)		(7,434	)

9

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands, except for share, per share and per ADS data)
Weighted average number of ordinary shares used in net loss per share calculations:
Basic and diluted		10,000,000			10,000,000			10,000,000			10,000,000			10,000,000			10,000,000			10,000,000
Net loss per ordinary share:
Basic and diluted(2)		(4.27	)		(6.31	)		(8.52	)		(1.28	)		(4.49	)		(4.94	)		(0.74	)
Net loss per ADS:(3)
Basic and diluted
Non-GAAP Financial Data:(4)
Adjusted net loss		(28,380	)		(33,378	)		(40,029	)		(6,023	)		(23,605	)		(24,437	)		(3,679	)
EBITDA		(26,885	)		(29,927	)		(31,174	)		(4,691	)		(21,626	)		(19,046	)		(2,867	)
Adjusted EBITDA		(24,591	)		(26,045	)		(22,368	)		(3,366	)		(17,673	)		(13,774	)		(2,074	)

(1)

Share-based compensation was allocated in costs and operating expenses as follows:

	For the Year Ended December 31,								For the Six Months Ended June 30,
	2013		2014		2015				2015		2016
	RMB		RMB		RMB		US$		RMB		RMB		US$
	(in thousands)
Cost of revenues		32		71		335		50		146		182		27
Sales and marketing expenses		86		370		1,651		248		650		1,075		162
Research and development expenses		163		449		3,347		504		1,515		1,966		296
General and administrative expenses		2,013		2,992		3,473		523		1,642		2,049		308
Total		2,294		3,882		8,806		1,325		3,953		5,272		793

(2)

Cumulative dividend to preferred shareholders, net loss attributable to ordinary shareholders and net loss per ordinary share, basic and diluted, for the years ended December 31, 2013 and 2014 and six months ended June 30, 2015 have been revised. See Note 2(a) to our audited consolidated financial statements and Note 2(a) to our unaudited interim consolidated financial statements included elsewhere in this prospectus.

(3)

Each ADS represents            Class B ordinary shares.

(4)

See "—Non-GAAP Financial Measures."

													As of June 30, 2016
	As of December 31,
																									Pro forma, as adjusted(2)
	2013			2014			2015						Actual						Pro forma(1)
	RMB			RMB			RMB			US$			RMB			US$			RMB			US$			RMB	US$
	(in thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents		77,960			61,830			198,523			29,871			115,663			17,404			115,663			17,404
Total assets		198,634			227,597			625,907			94,179			702,895			105,764			702,895			105,764
Total liabilities		121,982			182,192			360,133			54,187			460,180			69,243			460,180			69,243
Total mezzanine equity		163,324			176,941			476,018			71,626			499,607			75,174			—			—
Ordinary shares		68			68			—			—			—			—			—			—
Class A ordinary shares		—			—			31			5			31			5			31			5
Class B ordinary shares		—			—			37			6			37			6			117			18
Additional paid-in capital(3)		8,034			2,436			—			—			—			—			499,527			75,162
Accumulated deficit(3)		(97,100	)		(134,360	)		(191,644	)		(28,836	)		(227,104	)		(34,172	)		(227,104	)		(34,172	)
Total Gridsum's shareholders' (deficit)/equity		(86,672	)		(131,536	)		(210,628	)		(31,692	)		(257,249	)		(38,707	)		242,358			36,467
Noncontrolling interests		—			—			384			58			357			54			357			54
Total shareholders' (deficit)/equity		(86,672	)		(131,536	)		(210,244	)		(31,634	)		(256,892	)		(38,653	)		242,715			36,521

(1)

The consolidated balance sheet data as of June 30, 2016 are presented on a pro forma basis to give effect to the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering.

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(2)

The consolidated balance sheet data as of June 30, 2016 are presented on a pro forma, as adjusted basis to give effect to: (i) the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering; and (ii) the sale by us of             Class B ordinary shares in the form of ADSs in this offering at an assumed initial public offering price of US$        per ADS, the midpoint of the price range set forth on the cover of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

(3)

Additional paid-in capital and accumulated deficit have been revised as of December 31, 2013 and December 31, 2014. See Note 2(a) to our audited consolidated financial statements included elsewhere in this prospectus.

Non-GAAP Financial Measures

        In evaluating our business, we consider and use the following non-GAAP financial measures as supplemental measures to review and assess our operating performance: adjusted net loss, EBITDA and adjusted EBITDA. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with U.S. GAAP. We define adjusted net loss as net loss before share-based compensation, EBITDA as net loss before interest income and expenses, income tax expenses and depreciation expenses, and adjusted EBITDA as EBITDA before share-based compensation.

        We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate our business plans. These non-GAAP financial measures enable our management to assess our operating results without considering the impact of non-cash charges, including depreciation expenses and share-based compensation, and without considering the impact of non-operating items such as interest income and expenses and income tax expenses. We also believe that the use of these non-GAAP measures facilitates investors' assessment of our operating performance.

        These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using these non-GAAP financial measures is that they do not reflect all items of income and expense that affect our operations. Interest income and expenses, income tax expenses, depreciation expenses and share-based compensation have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted EBITDA. Further, these non-GAAP financial measures may differ from the non-GAAP financial measures used by other companies, including our peer companies, so their utility for comparison purposes may be limited.

        We compensate for these limitations by reconciling our non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

        The following tables reconcile our adjusted net loss, EBITDA and adjusted EBITDA in 2013, 2014, 2015 and the six months ended June 30, 2015 and 2016 to the most directly comparable financial measure calculated in accordance with U.S. GAAP, which is net loss:

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands)
Reconciliation of Net Loss to Adjusted Net Loss:
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)
Share-based compensation		2,294			3,882			8,806			1,325			3,953			5,272			793
Adjusted net loss		(28,380	)		(33,378	)		(40,029	)		(6,023	)		(23,605	)		(24,437	)		(3,679	)

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	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands)
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA:
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)
Interest income, net		(87	)		(180	)		(80	)		(12	)		(26	)		(189	)		(28	)
Income tax expenses		130			476			4,693			706			—			—			—
Depreciation and amortization expenses		3,746			7,037			13,048			1,963			5,958			10,852			1,633
EBITDA		(26,885	)		(29,927	)		(31,174	)		(4,691	)		(21,626	)		(19,046	)		(2,867	)
Share-based compensation		2,294			3,882			8,806			1,325			3,953			5,272			793
Adjusted EBITDA		(24,591	)		(26,045	)		(22,368	)		(3,366	)		(17,673	)		(13,774	)		(2,074	)

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RISK FACTORS

Investing in the ADSs involves significant risks. You should carefully consider the risks and uncertainties described below, together with all of the other information in this prospectus, including our consolidated financial statements and related notes, before making an investment in the ADSs. Any of the following risks could have a material adverse effect on our business, financial condition and results of operations. In any such case, the market price of the ADSs could decline, and you could lose all or part of your investment.

Risks Related to Our Business

We have a history of losses and we may not achieve or sustain profitability.

        We have incurred net losses in each year since our inception in 2005, including net losses of RMB30.7 million, RMB37.3 million, RMB48.8 million (US$7.3 million) and RMB29.7 million (US$4.5 million) in 2013, 2014, 2015 and the six months ended June 30, 2016, respectively. We expect to continue to expend substantial financial and other resources on, among other things:

•

investments in our research and development team and in the development of new solutions and enhancements of our existing solutions;

•

sales and marketing, including expanding our sales force, increasing our customer base, increasing market awareness of our solutions and enhancing our brand;

•

expanding of our operations and infrastructure;

•

hiring additional employees; and

•

general administration, including legal, accounting and other expenses related to being a public company upon completion of this offering.

        These efforts may prove more expensive than we currently anticipate and may not result in increased revenues or growth of our business. We also expect that our revenue growth rate will decline over time and that our costs will increase. We may not be able to generate sufficient revenues to offset higher costs and achieve or sustain profitability. If we fail to achieve or sustain profitability, our business and operating results would be adversely affected.

Our limited operating history makes it difficult to evaluate our current business and future prospects, and increases the risk of your investment.

        We launched our first data analytics solution, Web Dissector, in 2009, and introduced our other solutions to the market more recently. This limited operating history and the dynamic nature of the market in which we operate limit our ability to forecast future operating results and subject us to many uncertainties, including our ability to plan for and anticipate future growth. Our historical revenue growth should not be considered indicative of our future performance. We have encountered and will encounter risks and uncertainties frequently experienced by growing companies in rapidly changing industries, such as determining appropriate investments of our limited resources, market reception of our existing and future solutions, competition from other companies, attracting and retaining customers, hiring, integrating, training and retaining skilled personnel, developing new solutions, determining prices for our solutions and unforeseen expenses. If our assumptions regarding these risks and uncertainties, which we use to plan our business, are incorrect or change, or if we do not address these risks successfully, our operating and financial results and our business could be adversely affected.

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We have experienced rapid growth in recent periods and expect our growth to continue. If we are not able to manage growth of our business, or if our business does not grow as we expect, our operating results may be adversely affected.

        We have experienced rapid growth in our customer base and have expanded and intend to continue to expand our operations significantly. Our customer base increased from 141 customers in 2013 to 211 customers in 2014 and 307 customers in 2015, and our employee headcount increased from 268 employees as of December 31, 2013 to 425 employees as of December 31, 2014, 733 employees as of December 31, 2015, and 868 employees as of June 30, 2016. The majority of our revenues in 2013, 2014 and 2015 were generated by sales to existing customers. This growth has placed, and any further growth will place, significant demands on our management and our operational and financial infrastructure.

        To manage this growth effectively, we must continue to improve our operational, financial and management systems and controls by, among other things:

•

attracting, training and integrating new employees, particularly for our sales and research and development teams;

•

improving our operational infrastructure to support our business;

•

developing our internal control over financial reporting and our disclosure controls and procedures to ensure timely and accurate reporting of our operational and financial results; and

•

complying with applicable laws and regulations.

        If we fail to manage our growth, or if we fail to implement improvements or maintain effective internal controls, our costs and expenses may increase more than we plan and our abilities to expand our customer base, enhance our existing solutions, develop new solutions, satisfy existing customers, attract new customers, respond to competitive pressures or otherwise execute our business plan may be diminished, and our operating results would be adversely affected.

Our solutions may become less useful, and our business may be harmed, if we fail to adapt and respond effectively to rapidly developing technology, evolving industry standards and practices, and changing customer needs, requirements or preferences.

        The software industry is subject to rapid technological development, evolving industry standards and practices and changing customer needs, requirements and preferences. The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis. If we are unable to develop and sell new solutions that satisfy our customers and provide enhancements and new features for our existing solutions that keep pace with rapid technological change and industry developments, our revenues and operating results could be adversely affected. If new technologies emerge that are able to deliver competitive solutions and applications at lower prices, more efficiently, more conveniently or more securely than our solutions, those technologies could adversely impact our ability to compete and adversely affect our operating results.

To grow our business, we must achieve a high level of customer satisfaction and contract renewals, extend our relationships with existing customers over time and sell our solutions to new customers.

        We have no long-term customer contracts, and most of our customer contracts may be renewed on an annual basis. In addition, our top 20 customers accounted for 71%, 58%, 56% and 60% of our total revenues during the years ended December 31, 2013, 2014, 2015 and the six months ended June 30, 2016, respectively. For our business to grow and succeed we must achieve a high level of customer satisfaction so that our customers will renew their contracts with us and increase their utilization of the solutions they purchase from us. This requires that our solutions perform up to customer expectations and customers achieve the return on investment that they expect. Even if our products perform to specifications, customers may choose not to renew or to cancel early. Our success also depends on our

14

ability to extend our relationships with existing customers, both by growing their utilization of solutions they have purchased and by selling additional products in our solution suites. Finally, our ability to achieve significant revenue growth in the future also depends on our ability to attract new customers.

        Our ability to achieve customer renewals, expansions and new customer sales depends on many factors, including customer satisfaction with the performance of our solutions, our prices, the prices of competing solutions, mergers and acquisitions affecting our customer base, the effects of global economic conditions and reductions in customer spending levels generally. Our success with customers also depends on our ability to maintain a consistently high level of customer service and technical support to retain existing customers and attract new customers. If we are unable to hire and train sufficient support resources to provide adequate and timely support to our customers, our customers' satisfaction with our solutions will be adversely affected. To the extent that our customers do not renew their contracts, terminate early or renew on less favorable terms or if our efforts to sell additional solutions to existing customers or new customers are not successful, our revenues may decline and our operating results could be adversely affected.

We depend upon sales of our marketing automation solutions to enterprise customers for a significant portion of our revenues. A portion of the revenue from our marketing automation solutions is generated based on the volume of keyword placements with a small number of premium search engines in China. The loss of any of these customers or search engines, or the reduction in their activities, could materially adversely affect our business, results of operations and financial condition.

        In 2013, 2014, 2015 and the six months ended June 30, 2016, 91%, 84%, 89% and 90% of our net revenues, respectively, were derived from enterprise customers that purchased our marketing automation solutions, which include data analytics and bid management solutions for digital marketing services. We expect that, for the foreseeable future, we will continue to depend upon these customers for a significant portion of our revenues. A decline in sales to these customers would adversely affect our business, financial condition and operating results.

        Our marketing automation solutions allow our customers to automate the bidding for and purchase of keywords on search engines. A relatively small number of premium search engines, such as Baidu, Sogou and Qihoo 360, have historically accounted for a significant portion of the keyword inventory that customers purchased through our marketing automation solutions. In 2013, 2014, 2015 and the six months ended June 30, 2016, a majority of the search keyword impressions placed by customers using our marketing automation solutions were placed on Baidu websites. We expect that we will continue for the foreseeable future to depend upon a relatively small number of premium search engines for a significant portion of our customers' purchases of search keywords. Because we have no long-term commitments from these search engines, they may reduce the inventory they sell to our customers. If we fail to retain or replace premium search engine platforms, our business, results of operations and financial condition could be materially adversely affected. Revenues from Baidu's incentive program associated with keyword placements by our customers through our marketing automation solutions accounted for 18% of our revenues in 2013 and for less than 10% of our revenues in 2014, 2015 and the six months ended June 30, 2016. If Baidu were to change its incentive programs or to cease doing business with us for any reason, our revenues and our financial results would be materially adversely affected.

Our strategic relationships are an important part of our ability to grow our revenues, and if we do not maintain and strengthen those relationships, our results of operations and financial condition could be adversely affected.

        Under our cooperation agreement with the State Information Center of China, or the SIC, we established a non-governmental entity, the Research Center for e-Government, to serve the website and critical business application system needs of PRC local, municipal, provincial and central governmental agencies. In June 2015, we entered into a framework agreement and a collaboration agreement with an

15

entity that is wholly owned by the SIC, or the SIC Entity. Under these agreements, we and the SIC Entity have established a joint venture company, Beijing Guoxinwangyan, to oversee the business operations, sales and marketing and financial management of the Research Center. Beijing Gridsum and Guoxinjunhe each own 40%, and the SIC Entity owns 20%, of the equity interest in Beijing Guoxinwangyan.

        A significant portion of our e-Government revenues has been generated by sales to public sector agencies due in part to our strategic relationship with the SIC. Our ability to continue to sell our solutions to public sector agencies will depend on continued cooperation of the SIC and is subject to many uncertainties, such as the SIC may change its focus and reduce or terminate its support for e-Government initiative, and the fact that PRC public sector agencies may face funding reductions or delays, reducing sales of our solutions. In the event that any of these risks materialize, our revenues and results of operations could be materially adversely affected.

        In January 2016, we entered into a strategic cooperation agreement with the PRC Supreme People's Court Press, or People's Court Press, which established a framework for the application of our sophisticated data analytics and information recommendation technology to legal information services. We have collaborated with the People's Court Press to develop the Chinese Legal Information Platform (or "Faxin" in Chinese), which we launched in March 2016. Faxin is designed with tools in our Information Discovery Suite to manage legal information and resources and enable access to judicial precedents and legal information for the legal profession. Faxin is a new offering and there can be no assurance that it will be successful.

        Selling to public sector customers in the PRC involves a number of inherent risks. These sales often require significant upfront time and expense without any assurance that these efforts will generate a sale. Governmental agencies may require us to comply with various national and local regulations that are not applicable to sales to commercial enterprises, and compliance with those regulations may require us to put in place controls and procedures that may be costly to administer. Failure to comply with any such regulations could adversely affect our business, operating results and financial condition.

If we are not able to develop and introduce new solutions and enhancements of existing solutions that achieve market acceptance, our business could be adversely affected.

        Our ability to attract new customers and increase revenues from existing customers depends in large part on our ability to enhance and improve our existing solutions, increase adoption and usage of our solutions and introduce new solutions. As such, the continued growth in market demand of these solutions is critical to our continued success. In addition, our ability to grow our business depends in part on our ability to increase market acceptance of our other solutions, which are unproven. The success of new solutions and enhancements of existing solutions depend on many factors, including timely completion, adequate quality testing, introduction and market acceptance. Any new solutions that we develop may not be introduced in a timely or cost-effective manner, may contain errors or defects or may not achieve the broad market acceptance necessary to generate sufficient revenues. If we are unable to successfully enhance our existing solutions to meet customer requirements, increase adoption and usage of our solutions or develop new solutions, our business and operating results will be adversely affected.

Our future quarterly operating results may fluctuate significantly due to a wide range of factors, which makes our future results difficult to predict.

        Our revenues and operating results could vary significantly from quarter to quarter as a result of various factors, many of which are outside of our control, including:

•

fluctuation in our customer base;

•

timing and size of renewal of customer agreements and sales of additional solutions to existing customers;

16

•

timing and size of sales to new customers;

•

timing of our business expenses, in particular those associated with hiring of new employees;

•

introduction of solutions and enhancements by existing or new competitors in our market and changes in pricing for solutions offered by us or our competitors;

•

customers delaying purchasing decisions in anticipation of new solutions or enhancements by us or our competitors;

•

changes in customer budgets;

•

seasonal variations in our revenues, which have generally historically been highest in the fourth quarter of a calendar year and lowest in the first quarter;

•

our ability to control costs and expenses, including our operating expenses;

•

the timing of satisfaction of revenue recognition criteria, particularly with regard to large transactions;

•

our ability to provide software solutions on-demand, without network outages or security breaches;

•

fluctuations in our effective tax rate; and

•

general economic and political conditions, both domestically and internationally, as well as economic conditions specifically affecting industries in which our customers operate.

        Any one of these factors may result in fluctuations in our revenues and operating results, meaning that quarter-to-quarter comparisons of our revenues, operating results and cash flows may not necessarily be indicative of our future performance.

        We believe that quarter-to-quarter comparisons of our revenues, operating results and cash flows may not be meaningful and should not be relied upon as an indication of future performance. If our revenues or operating results fall below the expectations of investors or securities analysts in a particular quarter or below any guidance we may provide, the price of the ADSs could decline.

If the market for our cloud-based SaaS offerings develops more slowly than we expect, our growth may slow or stall, and our operating results would be adversely affected.

        The market for business software that is delivered as cloud-based software-as-a-service, or SaaS, offerings is less mature than traditional on-premises software applications, and the adoption rate of SaaS business software may be slower among customers in industries with heightened data security concerns or business practices requiring highly customizable application software. Our success will depend to a substantial extent on the widespread adoption of SaaS business software in general, but we cannot be certain that the trend of adoption of SaaS solutions will continue in the future. In particular, many organizations have invested substantial personnel and financial resources in integrating legacy software into their businesses over time, and some have been reluctant or unwilling to migrate to SaaS. It is difficult to predict customer adoption rates and demand for our solutions, the future growth rate and size of the SaaS business software market or the entry of competitive applications. The expansion of the SaaS business software market depends on a number of factors, including the cost, performance and perceived value associated with SaaS, as well as the ability of SaaS providers to address data security and privacy concerns. If SaaS business software does not continue to achieve market acceptance, or there is a reduction in demand for SaaS business software caused by a lack of customer acceptance, technological challenges, weakening economic conditions, data security or privacy concerns, governmental regulation, competing technologies and solutions or decreases in information technology spending, it would result in decreased revenues and our business would be adversely affected.

17

Our growth prospects will be adversely affected if we fail to successfully execute our mobile strategy, including developing, maintaining and enhancing the capabilities of our mobile solutions.

        The use of mobile devices to access the online content that our customers offer to their users, is growing rapidly and displacing personal computer-based access to those customer offerings. Our experience with Web Dissector may not provide a meaningful basis for you to evaluate our current business and prospects in mobile. We introduced Mobile Dissector in 2011, so our experience with it is limited and we cannot be certain that it will be successful. If we cannot provide effective functionality through our mobile solutions, as required by our customers, we may experience difficulty retaining and attracting customers.

        To deliver high quality applications, it is important that our solutions integrate with a wide range of other mobile technologies, systems, networks and standards that we do not control. We may not be successful in developing solutions that operate effectively with these technologies, systems, networks or standards. We have devoted and we expect to continue to devote substantial resources to our mobile solutions, and we cannot guarantee that the capabilities of our mobile solutions will be attractive to existing or potential customers. If we do not succeed in continuing to develop, maintain and enhance the capabilities of our mobile solutions, our growth prospects in the mobile sector will be adversely affected.

Our future growth, if any, depends on being able to expand our direct sales force and customer service and technical support team successfully.

        Our ability to increase our customer base, sell more of our solutions and achieve broader market acceptance of our solutions depends, to a significant extent, on our ability to expand our marketing and sales operations. To date, most of our growth has been attributable to the efforts of our direct sales force, which consists of a limited number of quota-carrying sales personnel and a limited number of customer service consultants. We intend to increase substantially the number of our direct sales personnel and customer service consultants. We believe there is significant competition for personnel with the skills and technical knowledge that we require, and from time to time we have experienced and expect to continue to experience significant turnover within our sales force. To the extent we experience unusual levels of turnover within our sales force or lose particularly valuable contributors, it may limit our ability to grow revenues and may harm our sales force productivity, which could lead to revenue declines. Our ability to achieve significant revenue growth will depend, in large part, on our success in recruiting, training and retaining sufficient numbers of sales personnel and customer service consultants to support our growth. New hires require significant training and may take significant time before they achieve full productivity. Newly hired personnel may not become productive as quickly as we expect, and we may be unable to hire or retain sufficient numbers of qualified individuals in the markets where we do business or plan to do business. In addition, as we continue to grow rapidly, a large percentage of our sales force will be new to our company and our solutions, which may make it more difficult to train our sales force effectively and may adversely affect our sales. If we are unable to hire and train sufficient numbers of effective sales personnel and customer service consultants or if our sales force is not successful in obtaining new customers or increasing sales to our existing customer base, our business will be adversely affected.

Failure to protect our customers' proprietary data could expose us to risks of liability, loss of business and reputational damage.

        Our operations involve protection of our intellectual property, along with the storage, transmission and processing of our customers' proprietary data, including some personally identifiable information. Security breaches, computer malware and computer hacking attacks could expose us to risks of loss of important customer information, which could result in loss of business, reputational damage, regulatory investigations and orders, litigation, indemnity obligations, damages for contract breach, penalties for

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violation of applicable laws or regulations and significant costs for remediation and incentives to customers or other business partners in an effort to maintain business relationships after a breach.

        Cyberattacks and other malicious internet-based activity continue to increase generally. If our security measures are perceived as weak or are actually compromised as a result of third-party action, employee or customer error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our customers may curtail or stop using our solutions, our reputation could be damaged, our business could be adversely affected, and we could incur significant liability. We may be unable to anticipate or prevent techniques used to obtain unauthorized access or to sabotage systems because they change frequently and generally are not detected until after an incident has occurred. As we increase our customer base and our brand becomes more widely known and recognized, we may become more of a target for third parties seeking to compromise our security systems or gain unauthorized access to our customers' data.

        Many of our contracts do not have limitations of liability provisions for a security lapse or breach, and we cannot assure you that any contractual limitations of liability provisions would be enforceable or would otherwise protect us from any liabilities or damages with respect to any particular claim. We do not have insurance to cover such liabilities and damages, and cannot be sure that insurance coverage will be available on acceptable terms, will be available in sufficient amounts to cover one or more large claims related to a security breach, or that the insurer will not deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceed available insurance coverage or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, including expansion rates, financial condition, operating results and reputation.

Our business collects and processes a large amount of data, and the improper use or disclosure of such data could harm our reputation as well as have a material adverse effect on our business and prospects.

        In the course of performing data analysis for our customers, we collect and process a large quantity of personal, transactional, demographic and behavioral data. Although we do not store any personally identifiable information, we nevertheless face risks inherent in handling large volumes of data and in protecting the security of such data. In particular, we face a number of challenges relating to data about internet users who visit our customers' websites:

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protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior or improper use by our employees;

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addressing concerns related to privacy and sharing, safety, security and other factors; and

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complying with applicable laws, rules and regulations relating to the collection, use, disclosure or security of personal information, including any requests from regulatory and government authorities relating to such data.

        Any systems failure or security breach or lapse on our part that results in the release of user data could harm our reputation and brand and, consequently, our business, in addition to exposing us to potential legal liability.

We may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs. If additional capital is not available, we may have to delay, reduce or cease operations.

        We do not know when or if our operations will generate sufficient cash to fund our ongoing operations. In the future, we may require additional capital to respond to business opportunities, including the need to develop new solutions or enhance our existing solutions, enhance our operating infrastructure or possible acquisitions of complementary businesses and technologies. We do not currently have any specific acquisition plans or targets. We may also require additional capital to respond to declines in demand for our products or other unforeseen circumstances. We may not be

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able to timely secure additional debt or equity financing on favorable terms, or at all. Any debt financing obtained by us could involve restrictive covenants relating to financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. If we raise additional funds through further issuances of equity, convertible debt securities or other securities convertible into equity, our existing shareholders could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights, preferences and privileges senior to those of holders of the ADSs. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to support our business and to respond to business opportunities and challenges could be significantly limited, and our business, operating results, financial condition and prospects could be adversely affected.

If we lose key members of our management team or are unable to attract and retain executives and employees we need to support our operations and growth, our business could be adversely affected.

        Our success and future growth depend largely upon the continued services of our executive officers and other key employees in the areas of research and development, marketing, sales, services and general administrative functions. From time to time, there may be changes in our executive management team or other key employees resulting from the hiring or departure of these personnel. The loss of one or more of our executive officers, particularly our chief executive officer and chairman, Guosheng Qi, or the failure of our executive team to work with our employees and lead our company effectively, could adversely affect our business.

        In addition, we must attract and retain highly qualified personnel to execute our growth plan. Competition for these personnel in Beijing, where our headquarters and the majority of our research and development personnel are located, and in other locations where we maintain offices is intense, especially for engineers experienced in designing and developing data analysis and digital intelligence solutions software and experienced sales professionals. We have from time to time experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications. Many of the companies with which we compete for experienced personnel are larger and have greater resources than we have. If we hire employees from competitors or other companies, their former employers may attempt to assert that these employees have breached their legal obligations, resulting in a diversion of our time and resources. In addition, prospective and existing employees often consider the value of the equity awards they receive in connection with their employment. If the perceived value of our equity awards declines or experiences significant volatility, it may be more difficult for us to recruit and retain key employees. If we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could be adversely affected.

We have identified a material weakness and certain other deficiencies in our internal controls as of December 31, 2015, and if we fail to maintain an effective system of internal controls, our ability to accurately and timely report our financial results or prevent fraud may be adversely affected, and investor confidence and the market price of the ADSs may be adversely affected.

        Prior to this offering, we have been a private company with limited accounting personnel and other resources with which to address our internal controls. In the course of auditing our consolidated financial statements, we and our independent registered public accounting firm identified a material weakness and certain other deficiencies in our internal controls. A material weakness is a deficiency, or combination of deficiencies, in internal controls, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness relates to our lack of sufficient financial reporting and accounting personnel with appropriate knowledge of U.S. GAAP and the Securities and Exchange Commission, or the SEC, reporting requirements to properly address complex accounting issues and to

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prepare and review our financial statements and related disclosures in accordance with U.S. GAAP and SEC financial reporting requirements. Although we have begun to implement measures to address the material weakness, implementation of those measures may not fully remediate the material weakness in a timely manner. In the future we may determine that we have additional material weaknesses, or our independent registered public accounting firm may disagree with our management assessment of the effectiveness of our internal controls.

        If we fail to establish and maintain adequate internal controls, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could limit our access to capital markets, adversely affect our results of operations and lead to a decline in the trading price of the ADSs. Additionally, ineffective internal controls could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list or to other regulatory investigations and civil or criminal sanctions. We could also be required to restate our historical financial statements.

The market in which we participate is intensely competitive, and if we do not compete effectively, our operating results could be adversely affected.

        The market for digital intelligence solutions is rapidly evolving, fragmented and highly competitive, with relatively low barriers to entry in some segments. Our competitors fall into three primary categories:

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diversified technology companies such as Google, IBM, Microsoft and Oracle;

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bid management companies such as adSage, MediaV and Adobe Efficient Frontier; and

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web analytics companies such as Adobe Omniture and WebTrends.

        Most recently, each of IBM, Oracle and Salesforce.com have begun offering "marketing cloud" solutions to customers, and we believe these companies and Adobe are our primary competitors in the market for marketing automation solutions.

        Some of our competitors and potential competitors are larger and have greater name recognition, longer operating histories, more established customer relationships, larger budgets, significantly greater resources and more operating flexibility to bundle competing solutions and services with other software offerings at little or no perceived incremental cost, including offering them at a lower price as part of a larger sale. As a result, our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards or customer requirements. In addition, some competitors may offer solutions or services that address one or a limited number of functions at lower prices or with greater depth than our solutions. Our current and potential competitors may develop and market new technologies with comparable functionality to our solutions, and this could lead to us having to decrease prices in order to remain competitive.

        With the introduction of new technologies and new market entrants, we expect competition to intensify in the future. As we expand the scope of our solutions, we may face additional competition. Additionally, some existing and potential customers, particularly large enterprises, may elect to develop their own internal solutions. If one or more of our competitors were to merge or partner with another of our competitors, the change in the competitive landscape could also adversely affect our ability to compete effectively. If we are unable to maintain our current pricing due to the competitive pressures, our margins will be reduced and our operating results will be adversely affected. Pricing pressures and increased competition generally could result in reduced sales and margins, losses or the failure of our solutions to achieve or maintain more widespread market acceptance, any of which could adversely affect our business.

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Interruptions or performance problems associated with our technology and infrastructure may adversely affect our business and operating results.

        Our success depends in part on reliable customer access to our solutions and reliably high performance by our solutions. We may experience disruptions, outages and other performance problems due to a variety of factors, including downtime at leased data center facilities, infrastructure changes, introductions of new functionality, human or software errors, capacity constraints due to an overwhelming number of users accessing our solutions simultaneously, denial of service attacks or other security related incidents. In addition, the availability and performance of our solutions are important to our customers, but it may become more difficult over time to maintain and improve our performance levels, especially during peak usage times, and as our solutions become more complex and our usage volume increases. If our solutions are unavailable to customers when needed or our solutions do not perform up to expected levels for any reason, our business will be adversely affected. Addressing these problems will require us to address capacity constraints, continually upgrade our systems and continually develop our technology and network architecture, which will increase our costs and may adversely affect our operating results.

Defects in our solutions could diminish demand for our solutions, adversely affect our financial results and subject us to liability.

        Our customers depend on our solutions for important aspects of their businesses, and any errors, defects or disruptions to our solutions or other performance problems with our solutions may damage our customers' businesses and could hurt our brand and reputation. We provide regular updates, which may contain undetected errors when first introduced or released. In the past, we have discovered software errors, failures, vulnerabilities and bugs in our solutions after they have been released, and additional errors in our existing solutions may be detected in the future. Real or perceived errors, failures or bugs in our solutions could result in negative publicity, loss of or delay in market acceptance of our solutions, loss of competitive position, delay of payment to us, lower renewal rates or claims by customers for losses sustained by them. In such an event, we may be required, or may choose for customer relations reasons or otherwise, to expend additional resources in order to help correct the problem. As a result, we could lose future sales and our reputation and our brand could be adversely affected. In addition, we currently do not and may not in the future carry insurance sufficient to compensate us for any losses that may result from claims arising from defects or disruptions in our solutions.

Any failure to protect our intellectual property rights could impair our ability to protect our proprietary technology.

        Our success depends to a significant degree on our ability to protect our proprietary technology. We will not be able to protect our intellectual property if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property. If we fail to protect our intellectual property rights adequately, our competitors may gain access to our technology and our business could be adversely affected.

        We rely on a combination of patents, trademarks, trade secrets, copyrights, service marks, contractual restrictions and other intellectual property laws and confidentiality procedures to establish and protect our proprietary rights. However, the steps we take to protect our intellectual property may be inadequate. We may be unable to obtain any patent protection for our technology subject to the pending patent applications. Any patents, trademarks or other intellectual property rights that we obtain may be challenged by others or invalidated through administrative process or litigation. We enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with other parties. There is no assurance that these agreements will be effective in controlling access to and distribution of our proprietary information.

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        Furthermore, legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain. The laws of the PRC are not as protective of intellectual property rights as those in the United States, and legal procedures for enforcement of intellectual property rights may be inadequate in China. Accordingly, despite our efforts, we may be unable to prevent third parties from infringing upon or misappropriating our intellectual property.

        We may be required to spend significant resources in monitoring and protecting our intellectual property rights. We may be required to pursue litigation to protect our intellectual property rights and to protect our trade secrets. Litigation brought to protect and enforce our intellectual property rights could be costly, time-consuming and distracting to management, and it could also result in the impairment or loss of portions of our intellectual property. Further, our efforts to enforce our intellectual property rights may be met with defenses, counterclaims and countersuits attacking the validity and enforceability of our intellectual property rights. Our failure to protect our proprietary technology against unauthorized copying or use, as well as any costly litigation or diversion of our management's attention and resources, could delay further sales or the implementation of our solutions, impair the functionality of our solutions, delay introductions of new solutions, result in our substituting less effective or more costly technologies into our solutions or injure our reputation.

We may be sued by third parties for alleged infringement of their proprietary rights.

        There are considerable patent, copyright, trademark, trade secret and other intellectual property development activities in our industry. Our success depends in part on not infringing on the intellectual property rights of others. From time to time, our competitors or other third parties may claim that we are infringing upon their intellectual property rights, and we may be found to be infringing upon such rights. Any claims or litigation, regardless of merit, could cause us to incur significant expenses and, if successfully asserted against us, could require that we pay substantial damages or ongoing royalty payments, prevent us from offering our solutions or require that we comply with other unfavorable terms.

        Even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources spent in resolving them, could divert the resources of our management and adversely affect our business and operating results. We expect that the occurrence of infringement claims is likely to grow as the market for digital intelligence solutions grows. Accordingly, our exposure to damages resulting from infringement claims could increase and this could further divert our financial and management resources.

Our use of open source software could negatively affect our ability to sell our solutions and subject us to possible litigation.

        We use open source software in our solutions and expect to continue to use open source software in the future. We may face claims from others claiming ownership of, or seeking to enforce the terms of, an open source license, including by demanding release of the open source software, derivative works or our proprietary source code that was developed using such software. These claims could also result in litigation, require us to purchase a costly license or require us to devote additional research and development resources to change our technologies, any of which would have a negative effect on our business and operating results. In addition, if the license terms for the open source software we utilize change, we may be forced to reengineer or discontinue our solutions or incur additional costs. We cannot be certain that we have incorporated open source software in our solutions in a manner that is consistent with our policies.

Natural disasters and other events beyond our control could adversely affect our business.

        Natural disasters or other catastrophic events may cause damage or disruption to our operations, international commerce and the global economy, and thus could have a strong negative effect on us. Our business operations are subject to interruption by natural disasters, fire, power shortages,

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pandemics and other events beyond our control. We rely on our network and third-party data center infrastructure, customers' internal technology systems and our website for our development, marketing, operational support, hosted solutions and sales activities. Although we maintain crisis management and disaster response plans, in the event of a major earthquake, hurricane or other catastrophic event such as fire, power loss, telecommunications failure, cyber-attack, war or terrorism, we may be unable to continue operations without interruption and may suffer lost revenues, delays in developing important software, reputational harm, breaches of data security and loss of critical data, all of which could have an adverse effect on our results of operations.

Risks Relating to Our Corporate Structure

We conduct our businesses in China through our variable interest entity and its subsidiaries by means of contractual arrangements. If the PRC government determines that such arrangements do not comply with applicable PRC laws and regulations, our business could be materially adversely affected.

        PRC laws and regulations impose restrictions on foreign ownership of companies that engage in internet, market survey and other related businesses from time to time. Specifically, foreign ownership of an internet content provider may not exceed 50% and the primary foreign investor of such provider must have a record of good performance and operating experience in managing internet content service.

        We are a company registered in the Cayman Islands and Dissector (Beijing) Technology Co., Ltd., our wholly owned PRC subsidiary that we refer to as the WFOE, is considered a foreign-invested enterprise, or FIE. To comply with PRC laws and regulations, we conduct our business in China through Gridsum Holding (Beijing) Co., Ltd., or Gridsum PRC Holding, and its subsidiaries, based on a series of contractual arrangements among the WFOE, Gridsum PRC Holding and its shareholders. The shareholders of Gridsum PRC Holding are our founders, Guosheng Qi and Guofa Yu, and a holding company owned by Guosheng Qi and other key employees. As a result of these contractual arrangements, we exert control over Gridsum PRC Holding, which is our variable interest entity, or VIE, and its subsidiaries, and we consolidate their operating results in our financial statements under U.S. GAAP. The subsidiaries of Gridsum PRC Holding hold the licenses and key assets that are essential for our business operations. For a detailed description of these contractual arrangements, see "Corporate History and Structure."

        In the opinion of our PRC counsel, Commerce & Finance Law Offices, (a) the ownership structures of the WFOE, Gridsum PRC Holding and the subsidiaries of Gridsum PRC Holding, both currently and immediately after giving effect to this offering, do not and will not violate applicable PRC laws, and (b) each agreement documenting the contractual arrangements among the WFOE, Gridsum PRC Holding and its shareholders, is valid, binding and enforceable in accordance with its terms under applicable PRC laws, and does not violate applicable PRC laws. However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations and there can be no assurance that the PRC government will take a view that is not contrary to or otherwise different from the opinion of our PRC counsel. If the contractual arrangements among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding are determined to be illegal or invalid, the relevant governmental authorities would have broad discretion in dealing with such violation, including revoking our business and operating licenses, requiring us to discontinue or restrict operations, restricting our rights to collect revenues, confiscating our income, requiring us to restructure our ownership structure or operations, imposing additional conditions or requirements with which we may not be able to comply or levying fines. These actions could cause significant disruption to our business operations and may materially and adversely affect our business, financial condition and operating results.

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We rely on contractual arrangements with Gridsum PRC Holding and its shareholders for our operations in China, which may not be as effective in providing operational control as direct ownership.

        We have relied and expect to continue to rely on contractual arrangements with Gridsum PRC Holding, in which we have no ownership interest, and the shareholders of Gridsum PRC Holding to conduct our business in China. These contractual arrangements are intended to provide us with effective control over Gridsum PRC Holding and its subsidiaries and allow us to obtain economic benefits from them, but may not be as effective as direct ownership. If Gridsum PRC Holding or its shareholders fail to perform their respective obligations under the contractual arrangements, we may incur substantial costs and expend substantial resources to enforce our rights.

        All of these contractual arrangements are governed by and interpreted in accordance with PRC law, and disputes arising from these contractual arrangements will be resolved through arbitration in China. There are very few precedents and little official guidance as to how contractual arrangements in the context of a VIE should be interpreted or enforced under PRC law. There remain significant uncertainties regarding the ultimate outcome of arbitration should legal action become necessary. The relevant PRC arbitration panel may conclude that our contractual arrangements violate PRC law or are otherwise unenforceable. In addition, arbitration awards are final and can only be enforced in PRC courts through arbitration award recognition proceedings, which could cause additional expenses and delays. In the event that we are unable to enforce these contractual arrangements or we experience significant delays or other obstacles in the process of enforcing these contractual arrangements, we may not be able to exert effective control over Gridsum PRC Holding, and may lose control over the assets owned by it and its subsidiaries. As a result, we may be unable to consolidate Gridsum PRC Holding and its subsidiaries in our consolidated financial statements, our ability to conduct our business may be adversely affected, and our business operations could be severely disrupted.

The beneficial owners of Gridsum PRC Holding may have potential conflicts of interest with us, which may materially adversely affect our business.

        The beneficial owners of Gridsum PRC Holding, our VIE, include Guosheng Qi, Guofa Yu and other key employees. Conflicts of interest may arise between the roles of these individuals as shareholders, directors and officers of our company on the one hand and as beneficial owners of Gridsum PRC Holding on the other. We rely on these individuals to abide by the laws of the Cayman Islands, which provide that directors and officers owe a fiduciary duty to our company to act in good faith and in the best interest of our company and not to use their positions for personal gain. We cannot assure you that when conflicts of interest arise, beneficial owners of Gridsum PRC Holding will act in the best interest of our company or that conflicts will be resolved in our favor. If we cannot resolve any conflicts of interest or disputes between us and these shareholders, we would have to rely on legal proceedings, which may be expensive, time-consuming and disruptive to our operations. There is also substantial uncertainty as to the outcome of any such legal proceedings.

Contractual arrangements with our consolidated affiliated entities may result in adverse tax consequences to us.

        Under applicable PRC tax laws and regulations, arrangements and transactions among related parties may be subject to audit or scrutiny by the PRC tax authorities. We could face adverse tax consequences if the PRC tax authorities determine that the contractual arrangements among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding are not on an arm's length basis and therefore constitute favorable transfer pricing. The PRC tax authorities could require that Gridsum PRC Holding adjust its taxable income upward. Such an adjustment could adversely affect us by increasing Gridsum PRC Holding's tax expenses without necessarily reducing the tax expenses of the WFOE, and subjecting Gridsum PRC Holding to late payment fees and other penalties for under-payment of taxes. As a result, our consolidated operating results could be adversely affected.

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We may lose the ability to use assets held by Gridsum PRC Holding or its subsidiaries that are important to the operation of our business if any of them goes bankrupt or becomes subject to a dissolution or liquidation proceeding.

        Gridsum PRC Holding and its subsidiaries hold assets and perform functions that are important to the operation of our business. In particular, the subsidiaries of Gridsum PRC Holding hold almost all patents for our proprietary technology, domain names, trademarks, copyrights and other intellectual property rights. In the event that Gridsum PRC Holding or any of its subsidiaries enters into bankruptcy or undergoes a voluntary or involuntary liquidation proceeding, all or part of its assets will become subject to liens or rights of third-party creditors. As a result, we may be unable to continue some or all of our business operations, which could materially adversely affect our business, financial condition and operating results.

Substantial uncertainties exist with respect to the enactment timetable and final content of a draft new PRC Foreign Investment Law and how it may impact the viability of our current corporate structure and business operations.

        In January 2015, the Ministry of Commerce of the PRC, or the MOFCOM, published a discussion draft of the Foreign Investment Law for public review and comments. Among other things, the draft Foreign Investment Law expands the definition of foreign investment and introduces the principle of "actual control" in determining whether a company should be treated as an FIE. It specifically provides that entities established in China (without direct foreign equity ownership) but "controlled" by foreign investors, through contract or trust for example, will be treated as FIEs. Once an entity falls within the definition of FIE, it may be subject to foreign investment "restrictions" or "prohibitions" set forth in a "negative list" to be separately issued by the State Council later. If an FIE proposes to conduct business in an industry subject to foreign investment "restrictions" in the "negative list," the FIE must go through a MOFCOM pre-approval process.

        Under the draft Foreign Investment Law, VIEs that are controlled via contractual arrangements would be deemed as FIEs if they are ultimately "controlled" by foreign investors, and any of their operations in the industry categories included in the "negative list" without MOFCOM pre-approval may be considered illegal. Conversely, for any companies with a VIE structure engaged in a "restricted" business included in the "negative list," the VIE structure may be deemed legitimate if it is ultimately controlled by PRC nationals. The draft Foreign Investment Law is not specific on what will happen to companies with an existing VIE structure.

        The internet content service and market survey businesses that we conduct through subsidiaries of Gridsum PRC Holding, which is our VIE, are subject to foreign investment restrictions set forth in the Guidance Catalogue of Industries for Foreign Investment (2015 Revision) issued by the MOFCOM and the National Development and Reform Commission, or the Catalogue. It is unclear whether the new "negative list" will be different from the relevant categories in the Catalogue. Substantial uncertainties exist with respect to the enactment timetable and final content of the draft Foreign Investment Law. To date, there is no timetable for the enactment of the draft Foreign Investment Law. If the enacted version of the Foreign Investment Law and the final "negative list" mandate further actions to be taken by us, such as a MOFCOM pre-approval process, there is no assurance that we can obtain such pre-approval on a timely basis, or at all.

Risks Relating to Doing Business in China

Adverse changes in economic and political policies of the PRC government could have a material adverse effect on overall economic growth in China, which could materially and adversely affect our business.

        Substantially all of our operations are conducted in China and substantially all of our revenues are generated in China. Accordingly, our operating results, financial condition and prospects are influenced by the economic, political and legal conditions and developments in China. China's economy differs

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from the economies of most developed countries in many respects, including the amount of government involvement in the economy, the general level of economic development, growth rates, foreign exchange control and allocation of resources. While the Chinese economy has grown significantly over the past few decades, this growth has remained uneven across different periods, regions and economic sectors. The PRC government exercises significant control over China's economic growth through strategically allocating resources, controlling the payment of foreign currency-denominated obligations, setting monetary policies and providing preferential treatment to particular industries or enterprises. Any adverse changes in the policies of the Chinese government or in PRC laws and regulations could have a material adverse effect on the overall economic growth of China, result in decreased demand for our solutions and adversely affect our business and operating results. In addition, our revenues are dependent on the number of our customers and the scope of the solutions used by our customers. Historically, during economic downturns there have been reductions in spending on digital intelligence as well as pressure for extended billing terms and other financial concessions. These conditions affect the level of information technology spending and could adversely affect our customers' ability or willingness to purchase our solutions, delay prospective customers' purchasing decisions, reduce the value or duration of their contracts or affect renewal rates, all of which could adversely affect our operating results.

Uncertainties in the interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.

        The PRC legal system is a civil law system based on written statutes. Unlike the common law system, prior court decisions may be cited for reference but have limited precedential value. In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters. Since then, the legislation has enhanced the protections of foreign investments in China. However, China has not developed a fully integrated legal system, and recently enacted laws and regulations may not sufficiently cover all aspects of economic activities in China. The interpretation and enforcement of these laws and regulations involve uncertainties. Since the PRC administrative authorities and courts have significant discretion in interpreting and implementing statutory and contractual terms, it may be difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection available to you and us.

        Furthermore, the PRC legal system is partly based on government policies and internal rules, some of which are not published in a timely manner or at all, and some of which may have retroactive effects. As a result, we may not be aware of our violation of any of these policies or rules until sometime after the violation. Such uncertainties, including the uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights could materially adversely affect our business and impede our ability to continue our operations.

The PRC regulations on offshore holding companies providing loans to and making direct investments in PRC entities may delay or prevent us from using the proceeds of this offering to fund the WFOE.

        Upon completion of this offering, we may finance and transfer funds to the WFOE by means of shareholder loans or capital contributions. Any loans we make to the WFOE cannot exceed statutory limits based on the difference between the total investment amount and the registered capital of the WFOE and must be registered with the State Administration of Foreign Exchange, or SAFE, or its local counterparts. Any capital contributions we make to the WFOE must be approved by appropriate governmental agencies. We may not be able to obtain these approvals on a timely basis, if at all. If we fail to obtain such approvals, our ability to provide loans or capital contributions to the WFOE in a timely manner may be adversely affected, which could materially adversely affect our liquidity and our ability to fund and expand our business.

        Moreover, the registered capital of the WFOE settled in RMB converted from foreign currencies may only be used within the business scope approved by the applicable governmental authority and may

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not be used to grant loans through entrustment arrangements with a bank, repay inter-company loans or repay bank loans that have been transferred to a third party. This may significantly limit our ability to fund our business operations in China.

The failure of our PRC-resident beneficial owners to comply with PRC foreign exchange regulations may subject the WFOE to liability or penalties, limit our ability to inject capital into the WFOE or limit the WFOE's ability to distribute profits.

        On July 4, 2014, SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents' Outbound Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, which replaced the former circular commonly known as "SAFE Circular 75" promulgated by SAFE on October 21, 2005. SAFE Circular 37 requires a PRC resident to make SAFE registration prior to contributing assets or interests to an overseas special purpose vehicle, or SPV, that is directly established or indirectly controlled by such PRC resident for the purpose of conducting investment or financing. SAFE Circular 37 further requires the PRC resident to make amendment registrations in the event of any major changes or events with respect to the SPV, such as increase or decrease of capital contributed by PRC individuals, share transfer or exchange, merger or division. In the event that a PRC-resident shareholder holding interests in a SPV fails to complete the required SAFE Circular 37 registration, the PRC subsidiary of such SPV may be prohibited from making profit distributions to its offshore parent and from carrying out subsequent cross-border foreign exchange activities, and the SPV may be restricted in its ability to contribute additional capital into its PRC subsidiary. Moreover, failure to comply with the various SAFE registration requirements described above could result in liability under the PRC law for evading foreign exchange controls. According to the Notice on Further Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment which came into effect on June 1, 2015, initial and amendment registrations under SAFE Circular 37 are handled by qualified local banks.

        The beneficial owners of Generation Gospel Limited, Garden Enterprises Ltd. and Fairy Spirit Limited who are PRC residents have completed initial registrations under SAFE Circular 37 with the local counterparts of SAFE relating to their investments in us. However, we may not be aware of the identities of all of our beneficial owners who are PRC residents. We do not have control over our beneficial owners and cannot assure you that all of our PRC-resident beneficial owners have complied and will comply with SAFE Circular 37 and subsequent implementation rules. The failure of our existing or future beneficial owners who are PRC residents to comply with the registration requirements and procedures set forth in SAFE Circular 37 and subsequent implementation rules may subject the WFOE to fines and legal sanctions, limit our ability to contribute additional capital to the WFOE and limit the WFOE's ability to distribute dividends or make other distributions to our company, which could adversely affect our business and prospects.

We and our Hong Kong subsidiary may be classified as a "PRC resident enterprise" for PRC enterprise income tax purposes, which would likely result in unfavorable tax consequences to us and our non-PRC shareholders.

        The PRC Enterprise Income Tax Law, or the EIT Law, provides that an enterprise established outside China whose "de facto management body" is located in China is considered a "PRC resident enterprise" and will generally be subject to the uniform 25% PRC enterprise income tax on its global income. Under the implementation rules of the EIT Law, "de facto management body" is defined as the organizational body which effectively manages and controls the production and business operation, personnel, accounting, properties and other aspects of operations of an enterprise.

        Pursuant to the Notice Regarding the Determination of Chinese-Controlled Overseas Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, issued by the PRC State Administration of Taxation, or the SAT, in 2009, an overseas incorporated enterprise controlled by PRC enterprises or PRC enterprise groups is considered a PRC resident enterprise if all

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of the following conditions are met: (i) the senior management and core management departments in charge of daily operations are located mainly in the PRC; (ii) financial and human resources decisions are subject to determination or approval by persons or bodies in the PRC; (iii) major assets, accounting books, company seals and minutes and files of board and shareholders' meetings are located or kept in the PRC; and (iv) at least half of the enterprise's directors or senior management with voting rights habitually reside in the PRC. Although the notice states that these standards only apply to offshore enterprises that are controlled by PRC enterprises or PRC enterprise groups, such standards may reflect the general view of the SAT in determining the tax residence of overseas incorporated enterprises.

        If the PRC tax authorities determine that our company or any of our non-PRC subsidiaries is a PRC resident enterprise for PRC enterprise income tax purposes, we or any such non-PRC subsidiary could be subject to PRC enterprise income tax at a rate of 25% on our or its global income, which could materially reduce our net income. In addition, we will also be subject to PRC enterprise income tax reporting obligations. Furthermore, if the PRC tax authorities determine that our company is a PRC resident enterprise, dividends paid by us and gains realized on the sale or other disposition of the ADSs or our ordinary shares may be subject to PRC tax, at a rate of 10% if the shareholder is a non-PRC resident enterprise or 20% in the case of a non-PRC individual shareholder (in each case, subject to the provisions of any applicable tax treaty). Such tax may materially reduce the value of the ADSs.

Any limitation on the ability of the WFOE to make distributions to us, or the tax implications thereof, could have a material adverse effect on our business or financial condition.

        We are a holding company, and we rely principally on dividends and other distributions from the WFOE for our cash needs, including the funds necessary to pay dividends to our shareholders or to service any debt we may incur. Current PRC regulations permit the WFOE to pay dividends only out of its accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, the WFOE is required to set aside at least 10% of its after tax profits each year, if any, to fund statutory reserve funds until the aggregate amount of such reserve funds reaches 50% of its registered capital. Apart from these reserves, the WFOE may allocate a discretionary portion of its after-tax profits to staff welfare and bonus funds at its discretion. These reserves and funds are not distributable as cash dividends. We cannot assure you that the WFOE will generate sufficient earnings and cash flows in the near future to pay dividends or otherwise distribute sufficient funds to enable us to meet our obligations, pay interest and expenses or declare dividends.

        Distributions made by a PRC company to its offshore parent are generally subject to a 10% withholding tax under the EIT Law. Pursuant to the EIT Law and the Arrangement Between the PRC and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion With Respect to Taxes on Income, the withholding tax rate on dividends paid by the WFOE to Gridsum HK would generally be reduced to 5%, provided that Gridsum HK is the beneficial owner of the income sourced from China. However, the Notice on How to Understand and Determine the Beneficial Owners in Tax Treaties, promulgated by the SAT in 2009, provides that a beneficial owner generally must engage in substantive business activities. An agent or a conduit company (meaning a company that is set up for the purpose of avoiding or reducing taxes or transferring or accumulating profits) will not be regarded as a beneficial owner and, therefore, will not qualify for treaty benefits. If Gridsum HK is regarded as a conduit company, it will not be able to enjoy the lower 5% withholding tax rate with respect to any dividends or distributions made by the WFOE.

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Governmental control of currency conversion may limit our ability to pay dividends and other obligations and affect the value of your investment.

        The PRC government imposes controls on the convertibility of the RMB into foreign currencies and the remittance of currency out of China. We receive substantially all of our revenues in RMB, and substantially all of our cash inflows and outflows are denominated in RMB. We primarily rely on dividend payments from the WFOE to fund any cash and financing requirements we may have.

        Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments, and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior SAFE approval as long as routine procedural requirements are fulfilled. Therefore, the WFOE is allowed to pay dividends in foreign currency to us without pre-approval from SAFE. However, approval from or registration with competent government authorities is required where the RMB is to be converted into foreign currency and remitted out of China to pay capital account items such as the repayment of loans denominated in foreign currencies. Also, the PRC government may at its discretion restrict access to foreign currencies for current account items in the future. If the foreign exchange control system in China prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders, including holders of the ADSs.

Failure to comply with PRC regulations regarding the registration requirements for share option plans may subject PRC plan participants or us to fines and other legal or administrative sanctions.

        Pursuant to SAFE Circular 37, PRC residents who participate in share incentive plans in overseas non-publicly listed SPVs due to their position as director, senior management or employees of the PRC subsidiaries of the overseas SPVs may submit applications to SAFE or its local branches for the foreign exchange registration with respect to such overseas SPVs. Upon completion of this offering, we and our directors, executive officers and other employees who are PRC residents and who have been granted options will be subject to the Circular on Relevant Issues Concerning the Foreign Exchange Administration for Domestic Individuals' Participation in Equity Incentive Plans of Overseas-Listed Companies issued by SAFE in February 2012, or SAFE Circular 7. Under SAFE Circular 7, PRC residents who participate in an employee share ownership or option plan of an overseas publicly listed company are required to register with SAFE and complete other procedures through a domestic qualified agent, which could be a PRC subsidiary of such overseas listed company. Such participants must also retain an overseas entrusted institution to handle matters in connection with their exercise or sale of share options. In addition, the PRC agent is required to make amendment registrations with respect to the share incentive plan if there is any material change to the share incentive plan, the PRC agent or the overseas entrusted institution or other material changes. Failure to comply with such requirements will subject us or our PRC resident option holders to fines and other legal or administrative sanctions.

        Furthermore, the SAT has issued circulars concerning employee share options or restricted shares. Under these circulars, employees working in the PRC who exercise share options, or whose restricted shares or restricted share units, or RSUs, vest, will be subject to PRC individual income tax. Our PRC subsidiary and controlled affiliated entities will be required to file documents related to employee share options, restricted shares or RSUs with the relevant tax authorities and to withhold individual income taxes of those employees related to their share options, restricted shares or RSUs. If the employees fail to pay, and our PRC subsidiary and controlled affiliated entities fail to withhold, such PRC individual income taxes, our PRC subsidiary and controlled affiliated entities may face sanctions imposed by the PRC tax authorities.

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Fluctuation in the value of the RMB may have a material adverse effect on the value of your investment.

        The value of the RMB against the U.S. Dollar and other currencies is affected by changes in China's political and economic conditions and China's foreign exchange policies, among other things. In 2005, the PRC government changed its decades-old policy of pegging the value of the RMB to the U.S. Dollar, and the RMB appreciated more than 20% against the U.S. Dollar over the following three years. Between July 2008 and June 2010, this appreciation halted and the fluctuation of the exchange rate between the RMB and the U.S. Dollar remained within a narrow range. The PRC government then allowed the RMB to appreciate slowly against the U.S. Dollar again, and as of June 30, 2016, the RMB had appreciated approximately 2.0% against the U.S. Dollar since June 30, 2010, though there also have been periods when the RMB depreciated against the U.S. Dollar. During a three-day period in August 2015, the RMB depreciated approximately 3.0% against the U.S. Dollar. It is difficult to predict how market forces or PRC or U.S. government policies may impact the exchange rate between the RMB and the U.S. Dollar in the future.

        Substantially all of our revenues and costs are denominated in RMB, and substantially all of our financial assets are also denominated in RMB. Any significant depreciation of the RMB may materially adversely affect the value of, and any dividends payable on, our ADSs in U.S. Dollars. To the extent that we need to convert U.S. Dollars we receive from this offering into RMB for our operations, appreciation of the RMB against the U.S. Dollar would have an adverse effect on the RMB amount we would receive from the conversion. Conversely, if we decide to convert our RMB into U.S. Dollars for the purpose of paying dividends on our ordinary shares or ADSs or for other business purposes, appreciation of the U.S. Dollar against the RMB would have an adverse effect on the U.S. Dollar amount available to us.

Registered public accounting firms in China, including our independent registered public accounting firm, are not inspected by the U.S. Public Company Accounting Oversight Board, which deprives us and our investors of the benefits of such inspection.

        Auditors of companies whose shares are registered with the SEC and publicly traded in the United States, including our independent registered public accounting firm, are required to be registered with the U.S. Public Company Accounting Oversight Board, or PCAOB, and are required to undergo regular inspections by the PCAOB to assess their compliance with the U.S. laws and professional standards applicable to auditors. Our independent registered public accounting firm is located in and organized under the laws of the PRC, which is a jurisdiction where the PCAOB is currently unable to conduct inspections without the approval of PRC authorities. This lack of PCAOB inspections in China prevents the PCAOB from fully evaluating audits and quality control procedures of our independent registered public accounting firm. As a result, we and investors in the ADSs are deprived of the benefits of such PCAOB inspections and it is more difficult to evaluate the effectiveness of our independent registered public accounting firm's audit procedures or quality control procedures, compared to auditors that are subject to PCAOB inspections. This could cause investors in the ADSs to lose confidence in our audit procedures and our reported financial information, which could result in declines in the market acceptance of the ADSs.

If additional remedial measures are imposed on major PRC-based accounting firms, including our independent registered public accounting firm, we could be unable to file our financial statements in compliance with SEC requirements.

        In December 2012, the SEC instituted administrative proceedings against several major PRC-based accounting firms, including our independent registered public accounting firm, alleging that these firms had violated U.S. securities laws and the SEC's rules and regulations thereunder by failing to provide to the SEC the firms' audit work papers with respect to certain PRC-based companies that are publicly traded in the United States. On January 22, 2014, the administrative law judge, or the ALJ, presiding

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over the matter rendered an initial decision that each of the firms had violated the SEC's rules of practice by failing to produce audit work papers to the SEC. The initial decision censured each of the firms and barred them from practicing before the SEC for a period of six months. The firms appealed the ALJ's initial decision to the SEC. The ALJ's decision does not take effect unless and until it is endorsed by the SEC. On February 6, 2015, the firms each agreed to a censure and to pay a fine to the SEC to settle the dispute and avoid suspension of their ability to practice before the SEC and audit U.S.-listed companies. The settlement required the firms to follow detailed procedures and to seek to provide the SEC with access to Chinese firms' audit documents via the China Securities Regulatory Commission, or the CSRC, in response to future document requests by the SEC made through the CSRC. If these accounting firms, including our independent registered public accounting firm, fail to comply with the documentation production procedures that are in the settlement agreement or if there is a failure of the process between the SEC and the CSRC, the SEC retains authority to impose additional remedial measures on the firms, such as imposing penalties on the firms and restarting the proceedings against the firms, depending on the nature of the failure. If the accounting firms are subject to additional remedial measures, our ability to file our financial statements in compliance with SEC requirements could be impacted. A determination that we have not timely filed financial statements in compliance with SEC requirements could ultimately lead to the delisting of the ADSs from the stock exchange on which they trade or the termination of the registration of the ADSs under the Securities Exchange Act of 1934, as amended, or the Exchange Act, or both, which would substantially reduce or effectively terminate the trading of the ADSs in the United States.

Any change in the preferential tax treatment we enjoy in the PRC may materially adversely impact our net income.

        Two of the subsidiaries of Gridsum PRC Holding, Beijing Gridsum and Guoxinjunhe, have been granted the status of "high and new technology enterprise" by PRC government agencies since 2014, with a three-year term of validity. As a result, the income tax rate of these entities is reduced to a preferential rate of 15% under applicable laws and regulations. However, the government agencies may decide not to renew the "high and new technology enterprise" status of these entities after the initial term expires, and therefore we cannot assure you of the continuance of the preferential tax treatment. The discontinuation of such preferential tax treatment could increase our operating and other expenses and adversely affect our net income.

We may have to register our encryption software with Chinese regulatory authorities, and if they request that we change our encryption software, our business operations could be disrupted as we develop or license replacement software.

        Pursuant to the Regulations for the Administration of Commercial Encryption promulgated in 1999, foreign and domestic companies operating in China are required to seek approval from the Office of the State for Cipher Code Administration, for the commercial encryption products they use. Companies operating in China are allowed to use only commercial cipher code products approved by this authority and are prohibited from using self-developed or imported cipher code products without approval. In addition, all cipher code products shall be produced by those producers appointed and approved by this authority. Because applicable regulations do not specify what constitutes a cipher code product, we are unsure as to whether or how they apply to us and the encryption software we utilize. We may be required to register or apply for permits for our current or future encryption software. If PRC authorities request that we register our encryption software or change our current encryption software to an approved cipher code product produced by an appointed producer, it could disrupt our business operations.

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Risks Relating to the ADSs and This Offering

There has been no public market for our shares or ADSs prior to this offering, and you may not be able to resell the ADSs at or above the price you paid, or at all.

        Prior to this offering, there has been no public market for our shares or ADSs. We have applied to list the ADSs on the NASDAQ Global Market. Our ordinary shares will not be listed on any exchange or quoted for trading on any over-the-counter trading system. If an active trading market for the ADSs does not develop after this offering, the market price and liquidity of the ADSs will be materially adversely affected.

        Negotiations with the underwriters will determine the initial public offering price for the ADSs which may bear no relationship to their market price after this offering. We cannot assure you that an active trading market for the ADSs will develop or that the market price of the ADSs will not decline below the initial public offering price.

The market price for the ADSs may be volatile, which could result in substantial losses to our investors.

        The trading price of the ADSs is likely to be volatile and could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, like the performance and fluctuation in the market prices or the underperformance or deteriorating financial results of other companies with business operations located mainly in China that have listed their securities in the United States. The securities of some of these companies have experienced significant volatility since their initial public offerings, including, in some cases, substantial price declines in the trading prices of their securities. The trading performances of other Chinese companies' securities after their initial public offerings may affect the attitudes of investors toward Chinese companies listed in the United States, which consequently may impact the trading performance of the ADSs, regardless of our actual operating performance. In addition, any negative news or perceptions about inadequate corporate governance practices or fraudulent accounting, corporate structure or matters of other Chinese companies may also negatively affect the attitudes of investors towards Chinese companies in general, including us, regardless of whether we have conducted any inappropriate activities. In addition, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, which may have a material adverse effect on the market price of the ADSs.

If securities or industry analysts do not publish research or reports about our business or if they publish inaccurate or unfavorable research about our business, the market price and trading volume of the ADSs could decline.

        The trading market for the ADSs will depend in part on the research and reports that securities or industry analysts publish about us or our business. If research analysts do not establish and maintain adequate research coverage or if one or more of the analysts who covers us downgrades the ADSs or publishes inaccurate or unfavorable research about our business, the market price for the ADSs would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume for the ADSs to decline, which could result in substantial losses for our investors.

Substantial future sales of the ADSs in the public market, or the perception that these sales could occur, could cause the price of the ADSs to decline.

        Additional sales of the ADSs in the public market after this offering, or the perception that these sales could occur, could cause the market price of the ADSs to decline. Upon completion of this offering, we will have 4,543,461 Class A ordinary shares and                        Class B ordinary shares

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outstanding (or                         Class B ordinary shares if the underwriters exercise their option to purchase additional ADS in full). All shares sold in this offering will be freely transferable without restriction or additional registration under the Securities Act of 1933, as amended, or the Securities Act. Ordinary shares outstanding after this offering will be available for sale, upon the expiration of the applicable lock-up period, subject to volume and other restrictions as applicable under Rule 144 and Rule 701 under the Securities Act. Any or all of these shares can be released prior to expiration of the lock-up period at the discretion of the representatives of the underwriters for this offering. To the extent shares are released before the expiration of the lock-up period and these shares are sold into the market, the market price of the ADSs could decline.

        In addition, some holders of our ordinary shares after the completion of this offering will have the right to cause us to register the sale of those shares under the Securities Act, subject to the applicable lock-up period in connection with this offering. Registration of these shares under the Securities Act would result in these shares becoming freely tradable without restriction under the Securities Act immediately upon the effectiveness of the registration. Sales of these registered shares in the public market could cause the price of the ADSs to decline.

Because the initial public offering price is substantially higher than the pro forma net tangible book value per share, you will experience immediate and substantial dilution.

        If you purchase ADSs in this offering, you will pay more for each ADS than the corresponding amount paid by existing shareholders for their ordinary shares. As a result, you will experience immediate and substantial dilution of US$                        per ADS (assuming that no outstanding options to acquire ordinary shares are exercised). This number represents the difference between our pro forma net tangible book value per ADS of US$                        as of June 30, 2016, after giving effect to this offering, and the assumed initial public offering price of US$                        per ADS, the midpoint of the price range set forth on the cover of this prospectus. In addition, you may experience further dilution to the extent that our ordinary shares are issued upon the exercise of share options. See "Dilution" for a more complete description of how the value of your investment in the ADSs will be diluted upon the completion of this offering.

We have wide discretion in how to use the net proceeds from this offering, and we may use these proceeds in ways with which you may not agree.

        We have wide discretion in how to use the net proceeds of this offering. You will not have the opportunity to assess whether the proceeds are being used appropriately before you make your investment decision. You must rely on the judgment of our management regarding the application of the net proceeds of this offering. We cannot assure you that the net proceeds will be used in a manner that would improve our operating results or increase the ADS price, nor that these net proceeds will be placed only in investments that generate income or appreciate in value.

Our dual-class ordinary share structure will limit your ability to influence corporate matters and could discourage others from pursuing change of control transactions that holders of our Class B ordinary shares and ADSs may view as beneficial.

        We adopted a dual-class ordinary share structure in January 2015. Our ordinary shares are divided into Class A ordinary shares and Class B ordinary shares. Upon completion of this offering, holders of Class A ordinary shares will be entitled to ten votes per share, while holders of Class B ordinary shares will be entitled to one vote per share. We will issue Class B ordinary shares represented by the ADSs in this offering. Generation Gospel Limited, which is owned and controlled by Guosheng Qi, our chief executive officer and chairman, will hold 4,543,461 Class A ordinary shares as of the completion of this offering. Immediately upon the completion of this offering, all of our preferred shares will automatically convert into Class B ordinary shares at a conversion ratio of one preferred share to one

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Class B ordinary share. Class B ordinary shares will not be convertible to Class A ordinary shares under any circumstances.

        Due to the disparate voting powers attached to these two classes of shares, we anticipate that our founders, officers and directors will collectively own approximately                        % of the voting power of our outstanding ordinary shares after this offering and will have considerable influence over matters requiring shareholder approval, including election of directors and significant corporate transactions, such as a merger or sale of our company or our assets. This concentrated control will limit your ability to influence corporate matters and could discourage others from pursuing any potential merger, takeover or other change of control transactions that holders of our Class B ordinary shares and ADSs may view as beneficial.

Because we do not expect to pay dividends in the foreseeable future after this offering, you must rely on price appreciation of the ADSs for return on your investment.

        We currently intend to retain most, if not all, of our available funds and any future earnings after this offering to fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in the ADSs as a source for any future dividend income.

        Our Board of Directors has complete discretion as to whether to distribute dividends. Even if our Board of Directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future operating results and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our Board of Directors. Accordingly, the return on your investment in the ADSs will likely depend entirely upon any future price appreciation of the ADSs. There is no guarantee that the ADSs will appreciate in value after this offering or even maintain the price at which you purchased the ADSs. You may not realize a return on your investment in the ADSs and you may even lose your entire investment in the ADSs.

You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them, if it is illegal or impractical to make them available to you.

        The depositary of the ADSs has agreed to pay to you the cash dividends or other distributions it or the custodian receives on Class B ordinary shares or other deposited securities underlying the ADSs, after deducting its fees and expenses. You will receive these distributions in proportion to the number of Class B ordinary shares the ADSs represent. However, the depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any holders of ADSs. For example, it would be unlawful to make a distribution to a holder of ADSs if it consists of securities that require registration under the Securities Act but that are not properly registered or distributed under an applicable exemption from registration. The depositary may also determine that it is not feasible to distribute certain property through the mail. Additionally, the value of certain distributions may be less than the cost of mailing them. In these cases, the depositary may determine not to distribute such property. We have no obligation to register under U.S. securities laws any ADSs, ordinary shares, rights or other securities received through such distributions. We also have no obligation to take any other action to permit the distribution of ADSs, ordinary shares, rights or anything else to holders of ADSs. This means that you may not receive distributions we make on our ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of the ADSs.

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You may experience dilution of your holdings due to inability to participate in rights offerings.

        We may, from time to time, distribute rights to our shareholders, including rights to acquire securities. Under the deposit agreement, the depositary will not distribute rights to holders of ADSs unless the distribution and sale of rights and the securities to which these rights relate are either exempt from registration under the Securities Act with respect to all holders of ADSs or are registered under the provisions of the Securities Act. The depositary may, but is not required to, attempt to sell these undistributed rights to third parties and may allow the rights to lapse. We may be unable to establish an exemption from registration under the Securities Act, and we are under no obligation to file a registration statement with respect to these rights or underlying securities or to endeavor to have a registration statement declared effective. Accordingly, holders of ADSs may be unable to participate in our rights offerings and may experience dilution of their holdings as a result.

You may be subject to limitations on transfer of the ADSs.

        The ADSs are transferable on the books of the depositary. However, the depositary may close its books at any time or from time to time when it deems expedient in connection with the performance of its duties. The depositary may close its books from time to time for a number of reasons, including in connection with corporate events such as a rights offering, during which time the depositary needs to maintain an exact number of ADS holders on its books for a specified period. The depositary may also close its books in emergencies, on weekends and on public holidays. The depositary may refuse to deliver, transfer or register transfers of the ADSs generally when our share register or the books of the depositary are closed, at any time if we or the depositary thinks it is advisable to do so because of any requirement of law or of any government or governmental body or under any provision of the deposit agreement, or for any other reason.

You, as holders of ADSs, may have fewer rights than holders of our ordinary shares and must act through the depositary to exercise those rights.

        Holders of ADSs do not have the same rights of our shareholders and may only exercise the voting rights with respect to the underlying Class B ordinary shares in accordance with the provisions of the deposit agreement. Under the memorandum and articles of association that we expect to become effective upon completion of this offering, the minimum notice period required to convene a general meeting is 14 days. When a general meeting is convened, you may not receive sufficient notice of a shareholders' meeting to permit you to withdraw your Class B ordinary shares to allow you to cast your vote with respect to any specific matter. In addition, the depositary and its agents may not be able to send voting instructions to you or carry out your voting instructions in a timely manner. We will make all reasonable efforts to cause the depositary to extend voting rights to you in a timely manner, but we cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote the ADSs. Furthermore, the depositary and its agents will not be responsible for any failure to carry out any instructions to vote, for the manner in which any vote is cast or for the effect of any such vote. As a result, you may not be able to exercise your right to vote and you may lack recourse if the ADSs are not voted as you requested. In addition, in your capacity as an ADS holder, you will not be able to call a shareholders' meeting.

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The depositary for the ADSs will give us a discretionary proxy to vote the Class B ordinary shares underlying your ADSs if you do not vote at shareholders' meetings, except in limited circumstances, which could adversely affect your interests.

        Under the deposit agreement for the ADSs, if you do not vote, the depositary will give us a discretionary proxy to vote the Class B ordinary shares underlying your ADSs at shareholders' meetings unless:

•

we have failed to timely provide the depositary with notice of meeting and related voting materials;

•

we have instructed the depositary that we do not wish a discretionary proxy to be given;

•

we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting;

•

a matter to be voted on at the meeting would have a material adverse impact on shareholders; or

•

the voting at the meeting is to be made on a show of hands.

        The effect of this discretionary proxy is that if you do not vote at shareholders' meetings, you cannot prevent the Class B ordinary shares underlying your ADSs from being voted, except under the circumstances described above. This may make it more difficult for shareholders to influence the management of our company. Holders of our Class A ordinary shares are not subject to this discretionary proxy.

You may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. federal courts may be limited because we are incorporated under Cayman Islands law, we conduct substantially all of our operations in China and substantially all of our directors and officers reside outside the United States.

        We are incorporated in the Cayman Islands and conduct substantially all of our operations in China through our PRC subsidiary and consolidated affiliated entities. Substantially all of our directors and officers reside outside the United States and a substantial portion of their assets are located outside of the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States in the event that you believe that your rights have been infringed under the U.S. securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of China may render you unable to enforce a judgment against our assets or the assets of our directors and officers.

        There are uncertainties as to whether Cayman Islands courts would:

•

recognize or enforce against us judgments of courts of the United States based on certain civil liability provisions of U.S. securities laws; and

•

impose liabilities against us, in original actions brought in the Cayman Islands, based on certain civil liability provisions of U.S. securities laws that are penal in nature.

        There is no statutory recognition in the Cayman Islands of judgments obtained in the United States, although the courts of the Cayman Islands will in certain circumstances recognize and enforce a non-penal judgment of a foreign court of competent jurisdiction without retrial on the merits. For more information regarding the relevant laws of the Cayman Islands and China, see "Enforceability of Civil Liabilities."

        Our corporate affairs are governed by our memorandum and articles of association, as amended and restated from time to time, and by the Companies Law (2013 Revision) and common law of the Cayman Islands. The rights of shareholders to take legal action against us and our directors, actions by

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minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, which provides persuasive, but not binding, authority in a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedents in the United States. In particular, the Cayman Islands has a less developed body of securities laws than the United States and provides significantly less protection to investors. In addition, shareholders in Cayman Islands companies may not have standing to initiate a shareholder derivative action in U.S. federal courts.

        As a result, our public shareholders may have more difficulty in protecting their interests through actions against us, our management, our directors or our major shareholders than would shareholders of a corporation incorporated in the United States.

We may be classified as a passive foreign investment company, or PFIC, under U.S. federal income tax law, which could result in material adverse U.S. federal income tax consequences to U.S. holders of the ADSs.

        Depending upon the value of our assets, which is generally determined based on the market value of the ADSs once we are a publicly traded corporation, and the nature of our assets and income over time, we could be classified as a PFIC for U.S. federal income tax purposes. Based on our current income and assets and projections as to the value of the ADSs pursuant to this offering, we do not believe we were a PFIC for the 2015 taxable year, and we do not expect to be classified as a PFIC for the current taxable year or in the foreseeable future. While we do not anticipate becoming a PFIC for the current taxable year, fluctuations in the market price of the ADSs or changes in the composition of our income or assets may cause us to become a PFIC for the current or any subsequent taxable year.

        We will be classified as a PFIC for any taxable year if either (i) 75% or more of our gross income for the taxable year is passive income or (ii) 50% or more of the value of our assets (determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income. Although the law in this regard is unclear, we intend to treat Gridsum PRC Holding as being owned by us for U.S. federal income tax purposes, not only because we exercise effective control over the operation of this entity but also because we are entitled to substantially all of its economic benefits and burdens, and, as a result, we consolidate its operating results in our consolidated U.S. GAAP financial statements. If it were determined, however, that we are not the owner of Gridsum PRC Holding for U.S. federal income tax purposes, the PFIC tests would apply differently and we could be treated as a PFIC for our current taxable year and any subsequent taxable year. Because of the uncertainties in the application of the relevant rules in respect of our VIE structure and because PFIC status is a factual determination made annually after the close of each taxable year on the basis of the composition of our income and the value of our active versus passive assets, there can be no assurance that we will not be a PFIC for the current taxable year or any future taxable year. The overall level of our passive assets will be affected by how, and how quickly, we spend our liquid assets and the cash raised in this offering. Under circumstances where we determine not to deploy significant amounts of cash for active purposes, our risk of becoming classified as a PFIC may substantially increase.

        If we were to be or become classified as a PFIC, a U.S. holder of the ADSs or Class B ordinary shares generally would be taxed at ordinary income rates on any sale of the ADSs or Class B ordinary shares and on any dividends treated as an "excess distribution" under the U.S. federal income tax rules. An interest charge also generally would apply if U.S. tax were deferred during the U.S. holder's holding period. Further, if we were a PFIC for any year during which a U.S. holder held the ADSs or ordinary shares, we generally would continue to be treated as a PFIC for all succeeding years during which such U.S. holder held the ADSs or ordinary shares. You are urged to consult your tax advisor concerning

38

the U.S. federal income tax consequences of acquiring, holding and disposing of ADSs or ordinary shares if we are or become classified as a PFIC. For more information see "Taxation—Material United States Federal Income Tax Considerations—Passive Foreign Investment Company Rules."

We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to U.S. domestic public companies.

        Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including:

•

the rules requiring filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K;

•

the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act;

•

the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and

•

the selective disclosure rules under Regulation FD governing issuer disclosure of material nonpublic information.

        We will be required to file an annual report on Form 20-F within four months of the end of each fiscal year beginning with the fiscal year ending December 31, 2016. In addition, we intend to publish our results on a quarterly basis as press releases, distributed pursuant to the rules and regulations of the NASDAQ Stock Market. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information that would be made available to you were you investing in a U.S. domestic issuer.

As a company incorporated in the Cayman Islands, we are permitted to adopt home country practices in relation to corporate governance matters that differ significantly from the NASDAQ corporate governance listing standards; these practices may afford less protection to shareholders than they would enjoy if we complied fully with the NASDAQ corporate governance listing standards.

        As a Cayman Islands company listed on the NASDAQ Global Market, we are subject to the NASDAQ corporate governance listing standards. However, the NASDAQ rules permit a foreign private issuer like us to follow the corporate governance practices of our home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the NASDAQ corporate governance listing standards. For example, neither the Companies Law of the Cayman Islands nor our memorandum and articles of association that will become effective upon the completion of this offering requires a majority of our directors to be independent, we could include non-independent directors as members of our compensation committee and nominating committee, and our independent directors would not necessarily hold regularly scheduled meetings at which only independent directors are present. If we choose to follow home country practice, our shareholders may be afforded less protection than they otherwise would under the NASDAQ corporate governance listing standards applicable to U.S. domestic issuers. As of the date of this prospectus, we are relying on home country practices whereby our compensation committee and nominating and corporate governance committee need not consist of all independent directors. As a result, we may have less independent oversight over the management of our company.

39

Any requirement to obtain prior approval from the CSRC could delay this offering, and a failure to obtain this approval, if required, could have a material adverse effect on our business, operating results, reputation and trading price of the ADSs and could create uncertainties for this offering.

        Six PRC regulatory agencies, including the CSRC, jointly promulgated the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, in August 2006, which became effective in September 2006 and was amended in June 2009. The M&A Rules purport, among other things, to require offshore special purpose vehicles, or SPVs, that are formed for overseas listing purposes through acquisitions of PRC domestic companies and controlled by PRC companies or individuals, to obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock exchange.

        While the application of the M&A Rules remains unclear, based on the advice of our PRC legal counsel, we believe that no prior approval from the CSRC is required for this offering because (a) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours are subject to the M&A Rules, and (b) we established the WFOE by means of direct investment rather than by merger or acquisition of PRC domestic companies and no explicit provision in the M&A Rules classifies the contractual arrangements among the WFOE, Gridsum PRC Holding and its shareholders as a type of acquisition transaction falling under the M&A Rules. However, uncertainties still exist as to how the M&A Rules will be interpreted and implemented, and our PRC legal counsel's opinion stated above is subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules. If the CSRC or another PRC regulatory body subsequently determines that we need to obtain CSRC approval for this offering, either by interpretation, clarification or amendment of the M&A Rules or by any new rules, regulations or directives or in any other way, we may face sanctions by the CSRC or other PRC regulatory agencies. In that event, the regulatory agencies may impose fines and penalties on our operations in the PRC, limit our operations in the PRC, delay or restrict the repatriation of the proceeds from this offering into the PRC or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of the ADSs. The CSRC or other PRC regulatory agencies may also take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of the ADSs offered hereby.

We are an "emerging growth company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make the ADSs less attractive to investors.

        We are an "emerging growth company," as defined in the federal securities laws, and we may take advantage of certain exemptions from various reporting requirements that are applicable to public companies that are not "emerging growth companies" including, but not limited to, not being required to provide auditor attestation of our internal control over financial reporting, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find the ADSs less attractive because we may rely on these exemptions. If some investors find the ADSs less attractive as a result, there may be a less active trading market for the ADSs and our stock price may be more volatile.

We will incur significantly increased costs and devote substantial management time as a result of operating as a public company.

        As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. For example, we will be subject to the reporting requirements of the Exchange Act, and will be required to comply with other applicable securities laws, and rules and regulations implemented by the SEC and the NASDAQ Stock Market, including the establishment and

40

maintenance of effective internal controls, disclosure controls and corporate governance practices. We expect that compliance with these requirements will increase our legal and financial compliance costs and will make some activities more time consuming and costly, particularly after we cease to qualify as an emerging growth company. In addition, we expect that our management and other personnel may divert attention from operational and other business matters to devote substantial time to these public company requirements. We will need to prepare and maintain an effective contract tracking database, hire additional accounting and finance staff with sufficient U.S. GAAP accounting and SEC reporting experience, and we will need to establish our audit committee process and an internal audit function. We cannot predict or estimate the amount of additional costs we may incur as a result of becoming a public company or the timing of such costs. We also expect that operating as a public company will make it more expensive for us to obtain director and officer liability insurance on the terms that we would like. As a public company, it may be more difficult for us to attract and retain qualified people to serve on our Board of Directors, our Board committees or as executive officers.

As a result of becoming a public company, we will be obligated to maintain effective internal control over financial reporting. We may not complete our analysis of our internal control over financial reporting in a timely manner or these internal controls may not be determined to be effective, which may adversely affect investor confidence in our company and, as a result, the value of the ADSs.

        As a public company, we will be required to furnish an annual management report on the effectiveness of our internal control over financial reporting. This assessment will need to include disclosure of any material weaknesses in our internal control over financial reporting that are identified by our management.

        We are currently evaluating our internal controls, identifying and remediating deficiencies in those internal controls and documenting the results of our evaluation, testing and remediation. We will not complete our evaluation and testing, and any required remediation, prior to this offering. During the evaluation and testing process, if we identify one or more material weaknesses in our internal control over financial reporting that we are unable to remediate before the end of the fiscal year in which the material weakness is identified, we will be unable to assert that our internal controls are effective. If we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm, when required, is unable to attest to management's report on the effectiveness of our internal controls, we could lose investor confidence in the accuracy and completeness of our financial reports, which would cause the price of the ADSs to decline.

        As a public company, we will be required to disclose material changes made in our internal control over financial reporting on a quarterly basis. However, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant until the later of the year following our first annual report required to be filed with the SEC or the date we are no longer an "emerging growth company" as defined in the federal securities laws. To comply with the requirements of being a public company, we may need to undertake various actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff.

41

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA

        This prospectus contains forward-looking statements that involve risks and uncertainties. All statements other than statements of current or historical facts are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

        You can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "likely to" or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include, but are not limited to, statements about:

•

our goals and strategies;

•

our future business development, financial condition and results of operations;

•

expected changes in our revenues, costs or expenditures;

•

developments in the digital intelligence and related industries in China and globally;

•

the growth of social media, internet and mobile users and internet and mobile advertising in China;

•

competition in our industry;

•

fluctuations in general economic and business conditions in China;

•

PRC governmental policies relating to media, software, big data, the internet, internet content providers and online advertising; and

•

our proposed use of proceeds from this offering.

        You should thoroughly read this prospectus and the documents that we refer to in this prospectus, with the understanding that our actual future results may be materially different from and worse than what we expect. Other sections of this prospectus include additional factors that could adversely impact our business and financial performance. Moreover, we operate in an evolving environment. New risk factors and uncertainties emerge from time to time and it is not possible for us to predict all risk factors and uncertainties. Nor can we assess the impact of all factors on our business, or the extent to which any factor or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.

        You should not rely upon forward-looking statements as predictions of future events. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

        This prospectus also contains statistical data, estimates and forecasts that are based on industry publications or reports generated by third-party providers of market intelligence, a report prepared for us by Forrester Consulting, a third-party research organization, or other publicly available information, as well as other information based on our internal sources. This information involves a number of assumptions and limitations, is subject to risks and uncertainties and is subject to change based on various factors, including those discussed in the section titled "Risk Factors" and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us. The Forrester Consulting report described herein represents data, research, opinions or viewpoints prepared by Forrester Consulting for us and may not be representations of fact. We have been advised by Forrester Consulting that its report speaks as of its original date (and not as of the date of this prospectus) and any opinions expressed in the report are subject to change without notice.

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USE OF PROCEEDS

        We estimate that we will receive net proceeds from this offering of approximately US$                         million, or approximately US$                         million if the underwriters exercise their option to purchase additional ADSs in full, after deducting underwriting discounts and commissions and the estimated offering expenses payable by us. These estimates are based upon an assumed initial public offering price of US$            per ADS, the midpoint of the price range set forth on the cover of this prospectus. A US$1.00 increase or decrease in the assumed initial public offering price of US$            per ADS, the midpoint of the price range set forth on the cover of this prospectus, would increase or decrease the net proceeds of this offering by US$             million, or approximately US$             million if the underwriters exercise their option to purchase additional ADSs in full, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

        The principal purposes of this offering are to increase our financial flexibility, increase our visibility in the marketplace and create a public market for our Class B ordinary shares. We intend to use the net proceeds of this offering for working capital and other general corporate purposes, including investments in technology and infrastructure, product development and expansion of sales and marketing efforts. Additionally, we may use a portion of the net proceeds to invest in or acquire complementary businesses, products, services or technologies. However, we do not have agreements or commitments for any material acquisitions as of the date of this prospectus. We cannot specify with certainty the particular uses of the net proceeds that we will receive from this offering. The amounts and timing of any expenditure will vary depending on the amount of cash generated by our operations and the rate of growth, if any, of our business.

        The foregoing represents our current intentions to use and allocate the net proceeds of this offering based upon our present plans and business conditions. Our management, however, will have significant flexibility and discretion to apply the net proceeds of this offering. If an unforeseen event occurs or business conditions change, we may use the proceeds of this offering differently than as described in this prospectus.

        Pending use of the net proceeds, we intend to hold our net proceeds in demand deposits or invest them in interest-bearing government securities.

        In utilizing the proceeds of this offering, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiary only through loans or capital contributions, and to our VIE and its subsidiaries only through loans. Subject to satisfaction of applicable government registration and approval requirements, we may extend inter-company loans to our PRC subsidiary or make additional capital contributions to our PRC subsidiary to fund its capital expenditures or working capital. We currently do not have any plans to use any of the proceeds from this offering as loans or capital contributions to our PRC subsidiary or to our VIE. However, if we need to utilize the proceeds of this offering to fund our PRC operations, we cannot assure you that we will be able to obtain these government registrations or approvals on a timely basis, if at all. See "Risk Factors—Risks Relating to Doing Business in China—The PRC regulations on offshore holding companies providing loans to and making direct investments in PRC entities may delay or prevent us from using the proceeds of this offering to fund the WFOE."

43

DIVIDEND POLICY

        We have not previously declared or paid cash dividends and have no plan to declare or pay any dividends on our shares or ADSs for the foreseeable future. We currently intend to retain most, if not all, of our available funds and any future earnings to operate and expand our business.

        We are a holding company incorporated in the Cayman Islands. We rely principally on dividends from our PRC subsidiary for our cash requirements, including any payment of dividends to our shareholders. PRC regulations may restrict the ability of our PRC subsidiary to pay dividends to us. See "Risk Factors—Risks Relating to Doing Business in China—Any limitation on the ability of the WFOE to make distributions to us, or the tax implications thereof, could have a material adverse effect on our business or financial condition."

        Our Board of Directors has discretion as to whether to distribute dividends, subject to applicable laws. Even if our Board of Directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the Board of Directors may deem relevant. If we pay any dividends, we will pay the ADS holders to the same extent as holders of our ordinary shares, subject to the terms of the deposit agreement, including the fees and expenses payable thereunder. See "Description of American Depositary Shares." Cash dividends on our ordinary shares, if any, will be paid in U.S. Dollars.

44

CAPITALIZATION

        The following table sets forth our capitalization as of June 30, 2016:

•

on an actual basis;

•

on a pro forma basis to reflect the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering; and

•

on a pro forma as adjusted basis to reflect (1) the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering, and (2) the issuance and sale by us of                        Class B ordinary shares in the form of ADSs by us in this offering at an assumed initial public offering price of US$            per ADS, the midpoint of the price range set forth on the cover of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the underwriters' option to purchase additional ADSs.

        You should read this table together with our consolidated financial statements and the related notes included elsewhere in this prospectus and the information under "Management's Discussion and Analysis of Financial Condition and Results of Operations."

45

	As of June 30, 2016
	Actual						Pro forma(1)						Pro forma, as adjusted(2)
	RMB			US$			RMB			US$			RMB	US$
	(in thousands)
Mezzanine equity:
Series A convertible preferred shares, US$0.001 par value, 3,125,000 shares authorized, issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma or pro forma as adjusted		41,919			6,307			—			—
Series A-1 convertible preferred shares, US$0.001 par value, 1,302,084 shares authorized, issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma or pro forma as adjusted		29,789			4,482			—			—
Series B convertible preferred shares, US$0.001 par value, 2,962,239 shares authorized, issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma or pro forma as adjusted		134,334			20,213			—			—
Series C convertible preferred shares, US$0.001 par value, 4,640,843 shares authorized, issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma or pro forma as adjusted		293,565			44,172			—			—
Shareholders' (deficit)/equity:
Class A ordinary shares, US$0.001 par value, 4,543,461 shares authorized, issued and outstanding, actual, pro forma and pro forma as adjusted		31			5			31			5
Class B ordinary shares, US$0.001 par value, 33,426,373 shares authorized and 5,456,539 shares issued and outstanding, actual; 33,426,373 shares authorized and 17,486,705 shares issued and outstanding, pro forma; and        shares authorized and        shares issued and outstanding, pro forma as adjusted		37			6			117			18
Additional paid-in capital(2)		—			—			499,527			75,162
Accumulated other comprehensive loss		(30,213	)		(4,546	)		(30,213	)		(4,546	)
Accumulated deficit		(227,104	)		(34,172	)		(227,104	)		(34,172	)
Total Gridsum's shareholders' (deficit)/equity		(257,249	)		(38,707	)		242,358			36,467
Noncontrolling interests		357			54			357			54
Total shareholders' (deficit)/equity(2)		(256,892	)		(38,653	)		242,715			36,521
Total capitalization(2)		242,715			36,521			242,715			36,521

(1)

The pro forma as adjusted information discussed above is illustrative only. Our additional paid-in capital, total shareholders' equity and total capitalization following the completion of this offering are subject to adjustment based on the actual initial public offering price.

(2)

Assuming the number of ADSs offered by us as set forth on the cover page of this prospectus remains the same, and after deduction of estimated underwriting discounts and commissions and estimated offering expenses payable by us, a US$1.00 increase (decrease) in the assumed initial public offering price of US$        per ADS, the midpoint of the estimated range of the initial public offering price set forth on the front cover of this prospectus, would increase (decrease) each of additional paid-in capital, total shareholders' equity and total capitalization by US$         million.

46

DILUTION

        Our net tangible book value as of June 30, 2016 on an actual basis was RMB242.7 million (US$36.5 million), or RMB24.3 (US$3.65) per ordinary share and US$                        per ADS. Net tangible book value represents the amount of our total consolidated tangible assets, less the amount of our total consolidated liabilities. Dilution is determined by subtracting the pro forma as adjusted net tangible book value per ordinary share and ADS from the assumed initial public offering price per ordinary share and ADS, respectively.

        Without taking into account any other changes in net tangible book value after June 30, 2016, other than to give effect to (i) the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares upon the completion of this offering and (ii) our issuance and sale of            ADSs offered in this offering at the assumed initial public offering price of US$            per ADS, the midpoint of the price range set forth on the cover of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the underwriters' option to purchase additional ADSs, our pro forma as adjusted net tangible book value as of June 30, 2016 would have been US$                        , or US$            per ordinary share and US$                        per ADS. This represents an immediate increase in net tangible book value of US$            per ordinary share and US$            per ADS to the existing shareholders, and an immediate dilution in net tangible book value of US$                        per ordinary share and US$            per ADS to investors purchasing ADSs in this offering. The pro forma as adjusted information discussed above is illustrative only. Our net tangible book value following the closing of this offering is subject to adjustment based on the actual initial public offering price of the ADSs.

        The following table illustrates such dilution:

	Per Ordinary Share		Per ADS
Assumed initial public offering price	US$		US$
Net tangible book value as of June 30, 2016	US$	3.65	US$
Pro forma net tangible book value after giving effect to the automatic conversion of all of our outstanding preferred shares	US$	1.66	US$
Pro forma as adjusted net tangible book value after giving effect to the automatic conversion of all of our outstanding preferred shares and this offering	US$		US$
Amount of dilution in net tangible book value to new investors in this offering	US$		US$

        A US$1.00 increase (decrease) in the assumed initial public offering price of US$            per ADS would increase (decrease) our pro forma as adjusted net tangible book value by US$                        , the pro forma as adjusted net tangible book value per ordinary share and per ADS by US$            per ordinary share and US$                        per ADS, and the dilution per ordinary share and per ADS to new investors in this offering by US$                        per ordinary share and US$            per ADS, respectively, assuming no change to the number of ADSs offered by us.

        The following table summarizes, on a pro forma as adjusted basis as of June 30, 2016, the differences between existing shareholders and the new investors with respect to the number of ordinary shares (in the form of ADSs) purchased from us in this offering, the total consideration paid and the average price per ADS paid at an assumed initial public offering price of US$                        per ADS before deducting estimated underwriting discounts and commissions and estimated offering expenses.

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The total number of ordinary shares does not include ordinary shares underlying the ADSs issuable pursuant to the exercise of the option to purchase additional ADSs granted to the underwriters.

	Ordinary Shares Purchased
				Total Consideration			Average Price Per Ordinary Share	Average Price Per ADS
	Number	Percent		Amount	Percent
				(US$)			(US$)	(US$)
Existing shareholders			%			%
New investors			%			%
Total			%			%

        The discussion and tables above also do not take into consideration any outstanding options to purchase our ordinary shares. As of June 30, 2016, there were 2,468,661 Class B ordinary shares issuable upon the exercise of outstanding options granted to our employees and members of our Board of Directors, at a weighted average exercise price of US$0.42 per ordinary share. To the extent that any of these options are exercised, there will be further dilution to new investors.

48

EXCHANGE RATE INFORMATION

        Our reporting currency is RMB. Substantially all of our operations are conducted in China and substantially all of our revenues and costs are denominated in RMB. This prospectus contains translations of RMB amounts into U.S. Dollars at specific rates solely for the convenience of the readers. The conversion of RMB into U.S. Dollars in this prospectus is based on the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board. Unless otherwise noted, any RMB amounts are translated into U.S. Dollars at the exchange rate on June 30, 2016 which was RMB6.6459 to US$1.00. We make no representation that any RMB or U.S. Dollar amounts could have been, or could be, converted into U.S. Dollars or RMB, as the case may be, at any particular rate, at the rates stated below, or at all. The PRC government imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade. The exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on August 19, 2016 was RMB6.6515 to US$1.00.

        The following table sets forth information concerning exchange rates between the RMB and the U.S. Dollar for the periods indicated. These rates are provided solely for your convenience and are not necessarily the exchange rates that we used in this prospectus or will use in the preparation of our periodic reports or any other information to be provided to you.

	Noon Buying Rate
Period	Period End		Average(1)		Low		High
	(RMB Per US$1.00)
2011		6.2939		6.4475		6.6364		6.2939
2012		6.2301		6.2990		6.3879		6.2221
2013		6.0537		6.1412		6.2438		6.0537
2014		6.2046		6.1704		6.2591		6.0402
2015		6.4778		6.2869		6.4896		6.1870
2016
February		6.5525		6.5501		6.5795		6.5154
March		6.4480		6.5027		6.5500		6.4480
April		6.4738		6.4754		6.5004		6.4571
May		6.5798		6.5259		6.5798		6.4738
June		6.6459		6.5892		6.6481		6.5590
July		6.6371		6.6771		6.7013		6.6371
August (through August 19, 2016)		6.6515		6.6381		6.6597		6.6239

(1)

Annual averages are calculated using the average of month-end rates of the respective periods. Monthly averages are calculated using the average of the daily rates during the respective periods.

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ENFORCEABILITY OF CIVIL LIABILITIES

        We are registered under the laws of the Cayman Islands as an exempted company with limited liability. We are incorporated in the Cayman Islands because of certain benefits associated with being a Cayman Islands company, such as political and economic stability, an effective judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional and support services. However, the Cayman Islands has a less developed body of securities laws as compared to the United States and provides less protection for investors. In addition, Cayman Islands companies do not have standing to sue before the federal courts of the United States.

        Substantially all of our assets are located, and our operations are conducted, outside the United States. In addition, a majority of our directors and officers are nationals or residents of jurisdictions other than the United States and all or a substantial portion of their assets are located outside the United States. As a result, it may be difficult for investors to effect service of process within the United States upon us or these persons, or to enforce against us or them judgments obtained in U.S. courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States.

        We have appointed Law Debenture Corporate Services Inc., located at 4th Floor, 400 Madison Avenue, New York, New York 10017, as our agent to receive service of process with respect to any action brought against us under the federal securities laws of the United States or of any state in the United States.

        Travers Thorp Alberga, our counsel as to Cayman Islands law, has advised us that there is uncertainty as to whether the courts of the Cayman Islands would (1) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers, predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States or (2) entertain original actions brought in the Cayman Islands against us or our directors or officers, predicated upon the securities laws of the United States or any state in the United States.

        Travers Thorp Alberga has informed us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), a judgment in personam obtained in such jurisdiction will be recognized and enforced in the courts of the Cayman Islands at common law, without any re-examination of the merits of the underlying dispute, by an action commenced on the foreign judgment debt in the Grand Court of the Cayman Islands, provided such judgment (a) is given by a competent foreign court with jurisdiction to give the judgment, (b) imposes a specific positive obligation on the judgment debtor (such as an obligation to pay a liquidated sum or perform a specified obligation), (c) is final and conclusive, (d) is not in respect of taxes, a fine or a penalty; and (e) was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. However, the Cayman Islands courts are unlikely to enforce a judgment obtained from the U.S. courts under civil liability provisions of the U.S. federal securities law if such judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in nature. Because such a determination has not yet been made by a court of the Cayman Islands, it is uncertain whether such civil liability judgments from U.S. courts would be enforceable in the Cayman Islands.

        Commerce & Finance Law Offices, our counsel as to PRC law, has advised us that there is uncertainty as to whether the courts of the PRC would (a) recognize or enforce judgments of U.S. courts obtained against the Company or directors or officers of the Company predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States; or (b) entertain original actions brought in each respective jurisdiction against the Company or directors or officers of the Company predicated upon the securities laws of the United States or any state in the United States.

50

CORPORATE HISTORY AND STRUCTURE

        We commenced operations in December 2005 with the establishment of Beijing Gridsum Technology Co., Ltd., or Beijing Gridsum, in China. We have established five additional operating companies: Beijing Moment Everlasting Ad Co., Ltd., in January 2011, and its wholly owned subsidiary, Beijing Yunyang Ad Co., Ltd., in March 2013, and Guoxinjunhe (Beijing) Technology Co., Ltd., in April 2012, Beijing Guoxinwangyan Technology Co., Ltd., in August 2015, and Beijing Gridsum Yizhun Technology Co., Ltd., in February 2016. We refer to these operating companies as Beijing Moment, Beijing Yunyang, Guoxinjunhe, Beijing Guoxinwangyan and Beijing Yizhun, respectively.

        From July to December 2014, we undertook a reorganization of our group of companies in preparation for our proposed initial public offering in the United States. We incorporated Gridsum Holding Inc., or Gridsum Cayman, under the laws of the Cayman Islands on July 21, 2014, as the parent holding company of our group of related companies. Gridsum Cayman established a wholly owned subsidiary in Hong Kong, Gridsum Holding (China) Limited, or Gridsum HK, which in turn established a wholly owned subsidiary in the PRC, Dissector (Beijing) Technology Co., Ltd., or the WFOE. Also as part of this reorganization, we established Gridsum Holding (Beijing) Co., Ltd., or Gridsum PRC Holding, in China, which acquired full ownership of Beijing Gridsum, Beijing Moment and Guoxinjunhe. The shareholders of Gridsum PRC Holding are our founders, Guosheng Qi and Guofa Yu, and Gridsum (Beijing) Management Consulting Co., Ltd., a holding company incorporated in the PRC and owned by Guosheng Qi and other key employees.

        To comply with applicable PRC laws and regulations, we conduct our operations in China principally through Beijing Gridsum, Guoxinjunhe, Beijing Moment, Beijing Yunyang, Beijing Guoxinwangyan and Beijing Yizhun. The WFOE entered into a series of contractual arrangements on December 22, 2014 with Gridsum PRC Holding, the parent of our PRC operating companies, and the shareholders of Gridsum PRC Holding. These contractual arrangements allow us to exercise effective control over Gridsum PRC Holding and receive substantially all of the economic benefits of Gridsum PRC Holding. As a result, we are the primary beneficiary of Gridsum PRC Holding and treat it as our variable interest entity, or VIE, under U.S. GAAP. We have consolidated the financial results of Gridsum PRC Holding and its subsidiaries in our consolidated financial statements.

        Prior to the reorganization in 2014, our group of companies was controlled by a predecessor Cayman Islands entity, whose wholly owned subsidiary in the PRC controlled our operating companies in China pursuant to a set of contractual arrangements, which contained substantially the same terms as, and were replaced by, the contractual arrangements entered into among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding in 2014.

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        The following diagram illustrates our corporate structure, including our significant subsidiaries, our consolidated VIE and its subsidiaries:

52

Contractual Arrangements with Gridsum PRC Holding and its Shareholders

        The following is a summary of the currently effective contractual arrangements among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding:

Exclusive Business Cooperation Agreement

        Under the Exclusive Business Cooperation Agreement dated December 22, 2014 between the WFOE and Gridsum PRC Holding, Gridsum PRC Holding has appointed the WFOE as its exclusive provider of complete technical support, business support and related consulting services, and, without prior written consent of the WFOE, may not accept the same or similar services provided by, or establish similar cooperation relationship with, any other party. In consideration of the services provided by the WFOE, Gridsum PRC Holding shall pay the WFOE, on a quarterly basis, service fees equal to 90% of Gridsum PRC Holding's net income (which equals gross income less mutually agreed costs). The parties can reasonably adjust the calculation ratio of such service fees. The WFOE shall have exclusive and proprietary rights and interests in all rights, ownership, interests and intellectual properties owned and used by WFOE during the performance of the agreement. The term of the agreement is 10 years and may be extended if confirmed in writing by the WFOE prior to expiration (and Gridsum PRC Holding shall unconditionally accept such extension). Gridsum PRC Holding shall not terminate the agreement prior to its expiration, unless the WFOE commits gross negligence or fraudulent act against Gridsum PRC Holding, whereas the WFOE may terminate the agreement upon giving 30 days' prior written notice to Gridsum PRC Holding at any time.

Exclusive Option Agreements

        Under the Exclusive Option Agreements, each dated December 22, 2014, among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding granted to the WFOE an irrevocable and exclusive right to purchase, or designate other person(s) to purchase, to the extent permitted by PRC laws, at any time all or part of such shareholders' equity interests in Gridsum PRC Holding. The purchase price shall be equal to RMB10.00 multiplied by the ratio of the equity interests to be purchased to the total registered capital of Gridsum PRC Holding, or, if there is any mandatory provision regarding the purchase price under PRC laws, then at the election of the WFOE or its designated person, the lowest price permitted by PRC laws. Without the WFOE's prior written consent, Gridsum PRC Holding shall not: (i) supplement, change or amend its articles of association, increase or decrease its registered capital or change its capital structure in any manner, (ii) sell, transfer, mortgage or dispose of, or create security interest on, any of its assets, business or legal right to collect interests, (iii) create, succeed to, guarantee or permit any debt, except for debts arising in the course of ordinary or daily business operation, (iv) enter into any material contract (i.e., any contract with a value exceeding RMB1,000,000), (v) provide loan or credit to any person, (vi) merge or combine with, buy or invest in, any other person or (vii) distribute dividends to its shareholders; and the shareholders of Gridsum PRC Holding shall not sell, transfer, mortgage or dispose of, or create security interest on, such shareholders' legal or beneficial interest in the equity interests in Gridsum PRC Holding without the prior written consent of the WFOE, except in accordance with the terms of the Equity Pledge Agreements described below. The term of each of the agreements is 10 years and may be renewed at the WFOE's election.

Shareholders' Voting Rights Proxy Agreements

        Under the Shareholders' Voting Rights Proxy Agreements, each dated December 22, 2014, among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding irrevocably authorized the WFOE or its designee to act on their behalf as their exclusive agent and attorney with respect to all matters concerning their shareholder rights, as shareholders of Gridsum PRC Holding, including without limitation to propose, convene and attend

53

shareholder meetings as proxy of such shareholders, and to exercise all of such shareholder's voting rights provided under PRC laws or the articles of association of Gridsum PRC Holding. Each agreement will remain effective until all equity interests of the respective shareholder in Gridsum PRC Holding have been transferred to the WFOE and the related regulatory process has been completed.

Equity Pledge Agreements

        Under the Equity Pledge Agreements, each dated December 22, 2014, among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding pledged all of their equity interests in Gridsum PRC Holding to the WFOE as security for, among other things, the performance of the obligations of Gridsum PRC Holding and its shareholders under the Exclusive Business Cooperation Agreement, the Exclusive Option Agreements and the Shareholders' Voting Rights Proxy Agreements. In the event of any breach of any secured obligations by Gridsum PRC Holding or the respective shareholder, the WFOE is entitled to all remedial rights and powers afforded under PRC laws, including to be repaid in priority with proceeds from auctions or sale-offs of the pledged equity. Dividends may only be paid to the shareholders of Gridsum PRC Holdings in respect of the pledged equity with the prior consent of the WFOE, and the dividends received by the shareholders shall first be applied to satisfy the secured obligations. The pledges will be released upon the full and complete performance of the secured obligations and the full payment of losses and fees resulting from a breach of those agreements by Gridsum PRC Holding or its shareholders. The equity pledges have been registered with local registration authority in accordance with PRC laws.

        In the opinion of Commerce & Finance Law Offices, our PRC counsel, (a) the ownership structures of the WFOE, Gridsum PRC Holding and the subsidiaries of Gridsum PRC Holding, both currently and immediately after giving effect to this offering, do not and will not violate applicable PRC laws; and (b) each agreement pertaining to the contractual arrangements among the WFOE, Gridsum PRC Holding and its shareholders is valid, binding and enforceable in accordance with its terms under applicable PRC laws, and does not violate applicable PRC laws. However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations, and there can be no assurance that the PRC government will take a view that is not contrary to or otherwise different from the opinion of our PRC counsel. If the PRC government finds that the agreements that establish the structure for operating our business do not comply with PRC government restrictions on foreign investment in the business we engage in, we could be subject to severe penalties, including being prohibited from continuing operations. See "Risk Factors—Risks Relating to Our Corporate Structure—We conduct our businesses in China through our variable interest entity and its subsidiaries by means of contractual arrangements. If the PRC government determines that such arrangements do not comply with applicable PRC laws and regulations, our business could be materially adversely affected." and "Risk Factors—Risks Relating to Doing Business in China—Uncertainties in the interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us."

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SELECTED CONSOLIDATED FINANCIAL DATA

        The following selected consolidated statements of operations data for the years ended December 31, 2013, 2014 and 2015, and selected consolidated balance sheet data as of December 31, 2013, 2014 and 2015, have been derived from our audited consolidated financial statements included elsewhere in this prospectus.

        The following selected consolidated statements of operations data for the six months ended June 30, 2015 and 2016, and selected consolidated balance sheet data as of June 30, 2016, have been derived from our unaudited interim consolidated financial statements included elsewhere in this prospectus. The unaudited interim consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements and include all adjustments, consisting of normal and recurring adjustments, that we consider necessary for a fair statement of our financial position and operating results for the periods presented. Results for the six months ended June 30, 2016 are not necessarily indicative of results that may be expected for the full year.

        You should read this Selected Consolidated Financial Data section together with our consolidated financial statements and the related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this prospectus. Our consolidated financial statements are prepared in accordance with U.S. GAAP. Our historical results are not necessarily indicative of results expected for future periods.

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands, except for share, per share and per ADS data)
Consolidated Statements of Operations Data:
Revenues:
Enterprise		57,025			104,891			208,157			31,321			75,483			133,918			20,150
e-Government and other		6,414			21,340			29,467			4,434			10,029			16,648			2,505
Less: Business tax and surcharges		(892	)		(1,711	)		(2,785	)		(419	)		(878	)		(2,499	)		(376	)
Net revenues		62,547			124,520			234,839			35,336			84,634			148,067			22,279
Cost of revenues(1)		(13,810	)		(21,143	)		(35,237	)		(5,302	)		(11,500	)		(20,023	)		(3,013	)
Gross profit		48,737			103,377			199,602			30,034			73,134			128,044			19,266
Operating expenses:
Sales and marketing expenses(1)		(29,012	)		(46,880	)		(84,548	)		(12,722	)		(33,351	)		(52,214	)		(7,857	)
Research and development expenses(1)		(20,385	)		(38,137	)		(100,186	)		(15,075	)		(40,178	)		(66,956	)		(10,075	)
General and administrative expenses(1)		(30,276	)		(54,931	)		(60,540	)		(9,109	)		(27,861	)		(37,466	)		(5,637	)
Total operating expenses		(79,673	)		(139,948	)		(245,274	)		(36,906	)		(101,390	)		(156,636	)		(23,569	)
Loss from operations		(30,936	)		(36,571	)		(45,672	)		(6,872	)		(28,256	)		(28,592	)		(4,303	)
Other income/(expense):
Foreign currency exchange gain/(loss)		296			(766	)		1,339			201			672			(889	)		(134	)
Interest income, net		87			180			80			12			26			189			28
Other income, net		9			373			111			17			—			(417	)		(63	)
Loss before income tax		(30,544	)		(36,784	)		(44,142	)		(6,642	)		(27,558	)		(29,709	)		(4,472	)
Income tax expense		(130	)		(476	)		(4,693	)		(706	)		—			—			—
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)
Less: Net loss attributable to noncontrolling interests		—			—			(16	)		(2	)		—			(27	)		(4	)
Net loss attributable to Gridsum Holding Inc.		(30,674	)		(37,260	)		(48,819	)		(7,346	)		(27,558	)		(29,682	)		(4,468	)
Accretion to preferred shares redemption value		(3,849	)		(9,480	)		(19,707	)		(2,965	)		(9,131	)		(11,050	)		(1,663	)
Cumulative dividend to preferred shareholders(2)		(8,215	)		(16,327	)		(16,642	)		(2,504	)		(8,240	)		(8,659	)		(1,303	)
Net loss attributable to Gridsum's ordinary shareholders(2)		(42,738	)		(63,067	)		(85,168	)		(12,815	)		(44,929	)		(49,391	)		(7,434	)

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	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands, except for share, per share and per ADS data)
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)
Foreign currency translation adjustment, net of nil tax		850			(2,006	)		(19,372	)		(2,915	)		(1,053	)		(11,161	)		(1,679	)
Total comprehensive loss		(29,824	)		(39,266	)		(68,207	)		(10,263	)		(28,611	)		(40,870	)		(6,151	)
Weighted average number of ordinary shares used in per share calculations:
Basic and diluted		10,000,000			10,000,000			10,000,000			10,000,000			10,000,000			10,000,000			10,000,000
Net loss per ordinary share:
Basic and diluted(2)		(4.27	)		(6.31	)		(8.52	)		(1.28	)		(4.49	)		(4.94	)		(0.74	)
Net loss per ADS:(3)
Basic and diluted
Non-GAAP Financial Data:(4)
Adjusted net loss		(28,380	)		(33,378	)		(40,029	)		(6,023	)		(23,605	)		(24,437	)		(3,679	)
EBITDA		(26,885	)		(29,927	)		(31,174	)		(4,691	)		(21,626	)		(19,046	)		(2,867	)
Adjusted EBITDA		(24,591	)		(26,045	)		(22,368	)		(3,366	)		(17,673	)		(13,774	)		(2,074	)

(1)

Share-based compensation was allocated in costs and operating expenses as follows:

	For the Year Ended December 31,								For the Six Months Ended June 30,
	2013		2014		2015				2015		2016
	RMB		RMB		RMB		US$		RMB		RMB		US$
	(in thousands)
Cost of revenues		32		71		335		50		146		182		27
Sales and marketing expenses		86		370		1,651		248		650		1,075		162
Research and development expenses		163		449		3,347		504		1,515		1,966		296
General and administrative expenses		2,013		2,992		3,473		523		1,642		2,049		308
Total		2,294		3,882		8,806		1,325		3,953		5,272		793

(2)

Cumulative dividend to preferred shareholders, net loss attributable to ordinary shareholders and net loss per ordinary share, basic and diluted, for the years ended December 31, 2013 and 2014 and the six months ended June 30, 2015 have been revised. See Note 2(a) to our audited consolidated financial statements and Note 2(a) to our unaudited interim consolidated financial statements included elsewhere in this prospectus.

(3)

Each ADS represents            Class B ordinary shares.

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(4)

See "Prospectus Summary—Summary Consolidated Financial Data—Non-GAAP Financial Measures."

													As of June 30, 2016
	As of December 31,
																									Pro forma, as adjusted(2)
	2013			2014			2015						Actual						Pro forma(1)
	RMB			RMB			RMB			US$			RMB			US$			RMB			US$			RMB	US$
	(in thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents		77,960			61,830			198,523			29,871			115,663			17,404			115,663			17,404
Total assets		198,634			227,597			625,907			94,179			702,895			105,764			702,895			105,764
Total liabilities		121,982			182,192			360,133			54,187			460,180			69,243			460,180			69,243
Total mezzanine equity		163,324			176,941			476,018			71,626			499,607			75,174			—			—
Ordinary shares		68			68			—			—			—			—			—			—
Class A ordinary shares		—			—			31			5			31			5			31			5
Class B ordinary shares		—			—			37			6			37			6			117			18
Additional paid-in capital(3)		8,034			2,436			—			—			—			—			499,527			75,162
Accumulated deficit(3)		(97,100	)		(134,360	)		(191,644	)		(28,836	)		(227,104	)		(34,172	)		(227,104	)		(34,172	)
Total Gridsum's shareholders' (deficit)/equity		(86,672	)		(131,536	)		(210,628	)		(31,692	)		(257,249	)		(38,707	)		242,358			36,467
Noncontrolling interests		—			—			384			58			357			54			357			54
Total shareholders' (deficit)/equity		(86,672	)		(131,536	)		(210,244	)		(31,634	)		(256,892	)		(38,653	)		242,715			36,521

(1)

The consolidated balance sheet data as of June 30, 2016 is presented on a pro forma basis to give effect to the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering.

(2)

The consolidated balance sheet data as of June 30, 2016 is presented on a pro forma, as adjusted basis to give effect to: (i) the automatic conversion of all of our outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering; and (ii) the sale by us of                         Class B ordinary shares in the form of ADSs in this offering at an assumed initial public offering price of US$                        per ADS, the midpoint of the price range set forth on the cover of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

(3)

Additional paid-in capital and accumulated deficit have been revised as of December 31, 2013 and December 31, 2014. See Note 2(a) to our audited consolidated financial statements included elsewhere in this prospectus.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the section entitled "Selected Consolidated Financial Data" and our consolidated financial statements and the related notes included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under "Risk Factors" and elsewhere in this prospectus.

Overview

        Gridsum is a leading provider of sophisticated data analysis software for multinational and domestic enterprises and government agencies in China. Our proprietary distributed data architecture allows our customers to efficiently collect and analyze vast amounts of information that is collected, indexed and stored in an organized manner, or structured data, and information that is not organized, or unstructured data. Our core technology, the Gridsum Big Data Platform, with its machine learning capability, performs multi-dimensional correlation analysis and analyzes complex real-time events. With the support of our Big Data Platform, our customers use our data visualization and data-mining technologies to identify complex relationships within their data and gain new insights that help them make better business decisions.

        Our leading position is based on our solutions and our core technologies. Our software products are designed for a variety of commercial and governmental applications. To help our enterprise customers reach China's large and growing online and mobile population, our initial products have focused on digital marketing analytics and automation solutions. We were among the first companies to offer web analytics solutions based on data warehouse technology, and we were among the first digital intelligence companies in China to build solutions entirely on a distributed data warehouse architecture using the open-source Hadoop framework. In addition, we believe we are the only China-based company to provide solutions to enterprise customers that cover web, video and mobile analytics. Our solutions analyze data from approximately 61 million internet and mobile sessions per day from users operating on over 233 million desktop and mobile devices. By leveraging the analytic capabilities of our Big Data Platform, we have developed additional software solutions, including new media analytics and information discovery solutions, to address a broad range of customer needs. In 2015, our customers included Fortune 500 and China 500 enterprises, comprising more than 300 customers across diverse industries, including over 30 Chinese government agencies.

        We are exclusively dedicated to developing proprietary technologies and solutions in digital intelligence. In 2009, we launched Web Dissector, our first digital intelligence solution, and our first Web Dissector customer remains a customer today. Since 2009, we have released a series of solutions based on our Big Data Platform, including SEM Dissector, SEO Dissector, Mobile Dissector, Contribution Dissector, Streaming Dissector, Video Dissector, Government Web Dissector, Media Dissector and Law Dissector. In 2014, we launched ADSUITE, a fully integrated package through which customers can access all our marketing automation solutions.

        We have grown rapidly in recent periods, with net revenues in 2013, 2014 and 2015 of RMB62.5 million, RMB124.5 million and RMB234.8 million (US$35.3 million), respectively, representing year-over-year growth of 99% and 89% respectively, and net revenues in the six months ended June 30, 2015 and 2016 of RMB84.6 million and RMB148.1 million (US$22.3 million), respectively, representing period-over-period growth of 75%. We have continued to make expenditures and investments, including in our technologies, personnel, sales and marketing, infrastructure and operations, and have incurred net losses in each period since our inception, including net losses of RMB30.7 million, RMB37.3 million, RMB48.8 million (US$7.3 million) and RMB29.7 million

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(US$4.5 million) in 2013, 2014, 2015 and the six months ended June 30, 2016, respectively. Our employee headcount has increased from 268 employees as of December 31, 2013 to 868 employees as of June 30, 2016. We had 141 customers, 211 customers and 307 customers in 2013, 2014 and 2015, respectively.

        We deliver our solutions as cloud-based software-as-a-service, or SaaS, offerings that are easy to deploy, easy to access, automatically updated without disruption, and enable our customers to reduce IT support costs by outsourcing hardware and software maintenance and support. We account for our revenues on a net basis, based on the fees our customers pay us without including any amounts they pay third parties for advertising or other services. We charge the majority of our customers based on percentage of their spending on our system in the bid management application or the volume of data being processed (e.g., page views or viewer views). When we provide our data analytics solutions with bid management functionality, we charge customers based on a percentage of their ad spending with the search engine providers. For example, a customer utilizing our bid management software to optimize the performance of its search engine marketing campaign would pay us a negotiated percentage of its ad spending through our software, as a service fee. When we offer our data analytics solutions to customers without reference to ad spending, we generally charge them negotiated variable amounts based on the monthly volume of data processed. We arrive at an annual data volume estimate before the engagement commences, and charge a fee for a predetermined base number of page views or viewer views. If the volume of the data processed exceeds the base, we charge progressively for the additional usage. To satisfy some of our customers' needs, we set a fee cap based on negotiation, subject to annual adjustment. In 2015, 90% of our revenues were recognized based on these arrangements. For some customers, we negotiate fixed-fee based contracts. In 2015, 10% of our net revenues were recognized based on fixed-fee arrangements. For the six months ended June 30, 2016, the revenues generated from the variable and fixed-fee based contracts represented 86% and 14% of our total revenues, respectively. For our marketing automation solutions, we earn and record service fee revenues over the contractual period, in proportion to ad spending or the completion of milestones that are stipulated in the contracts. In addition, we receive revenues from the incentive programs of search engine providers based on factors determined by them, such as yearly growth in the amount of advertising on the provider's search engine platform that our customers purchase through our solutions and other factors selected at the discretion of these providers. Revenues from these programs are received on both a quarterly and an annual basis. A majority of our customer contracts have terms of one year or more and may be renewed annually. Our gross margins in 2013, 2014, 2015 and the six months ended June 30, 2016 were 78%, 83%, 85% and 86%, respectively.

Factors Affecting Our Performance

Investment in Expansion and Further Penetration of Our Customer Base

        Our performance depends on our ability to continue to attract new customers and to accelerate and expand usage of our products by existing customers. For the foreseeable future, we expect that our revenue growth will be primarily driven by the pace of adoption and penetration of our products and we will incur significant expenses associated with educating the market about the benefits of our products. In order for us to continue to grow our business, it is important to generate additional revenues from our existing customers by upselling and cross selling to them. In order to support this effort, we have grown our customer service consultants from 37 as of December 31, 2013 to 56 as of December 31, 2014, 118 as of December 31, 2015 and 127 as of June 30, 2016, and we plan to continue to significantly increase the size of this team, particularly in the near term. We also intend to expand our marketing efforts to increase our brand awareness.

Investment in Innovation and Advancement of Our Products

        Our performance is significantly dependent on the investments we make in research and development in order to strengthen our ability to continue to innovate, improve functionality, develop

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new technologies or adapt to new technologies or changes to existing technologies. Our product innovation and development allows our customers to analyze growing volumes and variety of data in new ways. Our investments in this area include growing our research and development team from 91 employees as of December 31, 2013 to 158 employees as of December 31, 2014, 279 employees as of December 31, 2015 and 382 employees as of June 30, 2016. We intend to continue to invest in product innovation and leadership, including hiring top technical talent, focusing on core technology innovation and product development and entering into new industry verticals. One area of focus in the near term is development of solutions in the legal and financial services verticals based on our Gridsum Big Data Platform. Another area of focus is the development of mobile solutions in data analytics, information discovery, and data visualization. We do not expect to realize material revenues from all of these development initiatives in the near term.

Investment in Infrastructure

        We have made and expect to continue to make substantial investments in our infrastructure in connection with enhancing and expanding our operations. For example, in March 2015, we established a big data joint research laboratory with Harbin Institute of Technology, focusing on data mining and natural language processing technologies, and opened a research and development oriented office in Harbin. We expect to continue to open new offices in China. In addition, we expect to make additional investments in related infrastructure such as data centers, network bandwidth and technical operations personnel. We also expect to make additional investments in our infrastructure as we continue to transition to operation as a public company. We currently expect to rely on cash on hand and cash generated from operations to fund these investments.

Overall Development of the SaaS Enterprise Software Industry in China

        Our revenues are significantly affected by the growth in demand for enterprise SaaS software in China. Such demand is dependent on a number of factors, including the economic growth rates in the industries in which our customers operate and the overall adoption of SaaS solutions among enterprises and government agencies in China. Our performance will also depend on the emergence of future competition from multinational and domestic software providers in China. In addition, government policy and regulation of China's software industry may affect our results of operations.

Trends in Key Performance Indicators

        We review the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions:

Revenue Retention

        Revenue retention rate consists of aggregate net revenues from all customers in the prior period that remain customers in the current period, divided by total net revenues from all customers in the corresponding prior period. This includes the impact on net revenues from customer non-renewals and attrition, customer deployments of additional services or discontinued use of services, and price changes for our services. Our revenue retention rate was 168%, 116% and 138% in 2013, 2014 and 2015, respectively.

Average Customer Contribution

        We calculate average customer contribution by dividing total net revenues from customers in a period by the total number of customers for the same period. We monitor average customer contribution as a measure of our cross selling and upselling of our new solutions. Our average customer contribution was RMB443,596, RMB590,142 and RMB764,948 (US$115,101) in 2013, 2014 and 2015, respectively, representing increases of 33% and 30% year over year.

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Sales and Marketing Investments

        We monitor acquisition cost ratio, return on customer acquisition cost and payback period as measures of the efficiency of our investments in sales and marketing activities. Acquisition cost ratio consists of aggregate sales and marketing expenses in the prior period, divided by total net revenues from all customers in the current period. Our acquisition cost ratio was 0.30, 0.23 and 0.20 in 2013, 2014 and 2015, respectively. Return on customer acquisition cost consists of the change in gross profit from the prior period to the current period, divided by aggregate sales and marketing expenses in the prior period. Our return on customer acquisition cost was 124%, 188% and 205% in 2013, 2014 and 2015, respectively. Payback period consists of aggregate sales and marketing expenses in the current period divided by the change in gross profit from the prior period to the current period. Our payback period was 0.86 and 0.88 in 2014 and 2015, respectively.

Customers

        We define a customer in a period as a single organization that purchases our products and solutions and with respect to which we recognize revenue during such period. A single customer may have multiple paid business accounts for separate divisions, segments or subsidiaries, but all entities that are part of the same corporate structure are counted as a single customer. We periodically review and optimize our customer portfolio. In 2013, 2014 and 2015, we had 141, 211 and 307 customers. No single customer represented 10% or more of our total net revenues in 2013, 2014, 2015 and the six months ended June 30, 2016.

        We measure customer satisfaction of our solutions in terms of annual customer churn and annual revenue churn. We consider our regular customers to be those with contract durations of six months or more; customers with contract durations of less than six months we consider trial account customers. We offer short-term contracts to customers as trial accounts to attract and educate potential customers who may be unfamiliar with digital marketing platforms and our marketing automation solutions. In 2013 and 2014, churned trial account customers contributed 1.4% and 1.6% of our total revenues, respectively.

	Year ended December 31,
	2013		2014		2015(4)
Regular Customers:		113		161		239
Churned Regular Customer(1)		32		36		—
Annual Customer Churn Rate(2)		22.7%		17.1%		—
Annual Revenue Churn Rate(3)		6.4%		4.3%		—
Trial Account Customers:		28		50		68
Churned Trial Account Customers		10		25		—
Total Customers		141		211		307

(1)

We define churned regular customers as the number of regular customers that cease using our services in the fiscal year after they become our regular customers.

(2)

Annual customer churn rate is the number of churned regular customers in a fiscal year divided by the number of total customers in the same year.

(3)

Annual revenue churn rate for a subject year is the aggregate revenues generated by churned regular customers in a fiscal year divided by total revenues from all customers in the same year.

(4)

Churned regular customer, annual customer churn rate, and churned trial account customers for 2015 will not be available until the end of 2016. Annual revenue churn rate for 2015 will not become available until the audited financial statements for 2016 are completed.

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Key Components of Results of Operations

Net Revenues

        Net revenues consist of revenues recognized from customers who used our software solutions during the period, including revenues that we receive from the incentive programs of search engine providers, less business tax and surcharge. Historically, we have increased net revenues through our ability to increase the number of customers, retain high quality customers and increase the average customer contribution by upselling and cross selling new solutions. We believe this trend will continue as more customers adopt our solutions and demand more business intelligence to improve their operational efficiency, and as we continue to bring more innovative solutions to market and serve our customers.

Cost of Revenues

        Cost of revenues consists primarily of personnel and personnel-related expenses for our customer service consultants, who work closely with our customer sales, marketing, IT and other operating professionals to help customers optimize the performance of their accounts, and periodically provide in-depth analyses for customers. Personnel costs consist of salaries, benefits, bonuses and share-based compensation. Cost of revenues also includes data center expenses, office and overhead costs, bandwidth costs and depreciation expenses related directly to providing services to customers. We plan to continue increasing the capacity, capability and reliability of our infrastructure to support the growth of our customer base and the number of products we offer. We expect that, for the foreseeable future, our cost of revenues will increase in absolute amount but fluctuate slightly as a percentage of our net revenues around current levels.

Gross Profit and Gross Margin

        Gross profit is net revenues less cost of revenues. Gross margin is gross profit expressed as a percentage of net revenues. Our gross margin has been, and will continue to be, affected by a number of factors, including the timing and extent of our investments in our operations and personnel, hosting- related costs and other depreciation expense allocations. We expect that our gross margin will be stable or slightly increase over the long term, although we expect our gross margin to fluctuate from period to period.

Operating Expenses

        Our operating expenses consist of sales and marketing, research and development, and general and administrative expenses. For each category, the most significant component of our operating expenses are personnel costs, which consist of salaries, benefits, bonuses, share-based compensation, and for sales and marketing expenses, sales commissions. We also incur other non-personnel costs such as an allocation of our general overhead expenses.

Sales and Marketing Expenses

        Sales and marketing expenses consist primarily of personnel costs for our sales, marketing and business development employees and executives. Commissions are expensed in the period when a customer contract is executed. Sales and marketing expenses also include the costs of our marketing and brand awareness programs. We plan to continue investing in sales and marketing by increasing the number of our sales personnel, expanding our marketing activities, building brand awareness and sponsoring additional marketing events. We expect our sales and marketing expenses to continue to increase in absolute amount. However, we expect our sales and marketing expenses to decrease as a percentage of net revenues over the long term, although our sales and marketing expenses may fluctuate from period to period depending on fluctuations in net revenues and the timing and extent of our sales and marketing expenses.

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Research and Development Expenses

        Research and development expenses consist primarily of personnel costs and an allocation of our general overhead expenses. We continue to focus our research and development efforts on adding new features and products and on increasing the functionality and enhancing the ease of use of our existing products. In addition, we invest aggressively in the research and development of the infrastructure layer of software technologies, which will benefit us in the long run. We expense all our software development costs as they are incurred. We plan to continue to hire employees for our engineering, product management and consulting teams to support our research and development efforts. As a result, we expect our research and development expenses to continue to increase in absolute amount for the foreseeable future. However, we expect our research and development expenses to decrease modestly as a percentage of net revenues over the long term, although it may fluctuate from period to period depending on fluctuations in net revenues and the timing and extent of our research and development expenses.

General and Administrative Expenses

        General and administrative expenses consist primarily of personnel costs for our administrative, legal, human resources, information technology, finance and accounting employees and executives. Also included are non-personnel costs, such as legal and other professional fees. We plan to continue to expand our business in China, and we expect to increase the size of our general and administrative function to support the growth of our business. We also expect that we will incur additional general and administrative expenses as a result of being a publicly traded company. As a result, we expect our general and administrative expenses to continue to increase in absolute amount for the foreseeable future. However, we expect our general and administrative expenses as a percentage of net revenues to decrease modestly over the long term, although it may fluctuate from period to period depending on fluctuations in our net revenues and the timing and extent of our general and administrative expenses.

Other Income/(Expense), Net

        Other income/(expense), net consists primarily of interest income, net, and foreign exchange gain or loss.

Taxation

        We generate the majority of our operating loss from our PRC operations and have recorded income tax provisions for the periods presented. On a consolidated basis, we have not been profitable yet and have an operating loss carried forward. However, some of our operating entities have taxable income in the past, due to the profit before tax or permanent difference incurred by non-deductible expenses, which resulted in the income tax payment and liability. Income tax liability is calculated based on a separate return basis as if we had filed separate tax returns for all the periods presented.

Cayman Islands

        We are not subject to income or capital gains tax under the current laws of the Cayman Islands. There are no other taxes likely to be material to us levied by the government of the Cayman Islands.

Hong Kong

        Our subsidiary incorporated in Hong Kong, Gridsum Holding (China) Limited, is subject to Hong Kong profit tax at a rate of 16.5%. Hong Kong does not impose a withholding tax on dividends.

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China

        Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang, Beijing Guoxinwangyan and Beijing Yizhun are incorporated in China and are subject to enterprise income tax on their taxable income in China at a standard rate of 25% if they are not eligible for any preferential tax treatment. Taxable income is based on the entity's global income as determined under PRC tax laws and accounting standards. According to the PRC Enterprise Income Tax Law and relevant regulations, with approval of relevant tax authorities, the income of Beijing Gridsum and Guoxinjunhe, which are determined to be generated from a high and new technology enterprise, will be taxed at a preferential rate of 15%.

        Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang, Beijing Guoxinwangyan and Beijing Yizhun are also subject to VAT and related surcharges at a combined rate of approximately 6.7%. Beijing Gridsum, Beijing Moment and Guoxinjunhe have been subject to VAT since September 2012. Previously, these entities had been subject to business tax and related surcharges at a combined rate of 5.6%. Where we serve in a pass-through capacity between an advertising customer and a search engine provider, our revenues from the portion of those contracts related to advertising are subject to a 3% cultural development fee.

        Dividends that the WFOE, our wholly owned subsidiary in China, pays to Gridsum HK, our intermediary holding company in Hong Kong, will be subject to PRC withholding tax at a rate of 10%, unless they qualify for a special exemption. If Gridsum HK satisfies all the requirements under the Arrangement Between the PRC and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect to Taxes on Income and receives approval from the relevant tax authority, then dividends paid by the WFOE to Gridsum HK will be subject to a withholding tax rate of 5% instead. See "Risk Factors—Risks Relating to Doing Business in China—Any limitation on the ability of the WFOE to make distributions to us, or the tax implications thereof, could have a material adverse effect on our business or financial condition."

        If our holding company in the Cayman Islands, Gridsum Cayman, were deemed to be a "PRC resident enterprise" under the Enterprise Income Tax Law, it would be subject to enterprise income tax on its global income at a rate of 25%. See "Risk Factors—Risks Relating to Doing Business in China—We and our Hong Kong subsidiary may be classified as a 'PRC resident enterprise' for PRC enterprise income tax purposes, which would likely result in unfavorable tax consequences to us and our non-PRC shareholders."

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Results of Operations

        The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our consolidated financial statements and related notes included elsewhere in this prospectus. Due to our limited operating history, period-to-period comparisons discussed below may not be meaningful and are not indicative of our future trends.

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands)
Consolidated Statements of Operations Data:
Revenues:
Enterprise		57,025			104,891			208,157			31,321			75,483			133,918			20,150
e-Government and other		6,414			21,340			29,467			4,434			10,029			16,648			2,505
Less: Business tax and surcharges		(892	)		(1,711	)		(2,785	)		(419	)		(878	)		(2,499	)		(376	)
Net revenues		62,547			124,520			234,839			35,336			84,634			148,067			22,279
Cost of revenues(1)		(13,810	)		(21,143	)		(35,237	)		(5,302	)		(11,500	)		(20,023	)		(3,013	)
Gross profit		48,737			103,377			199,602			30,034			73,134			128,044			19,266
Operating expenses:
Sales and marketing expenses(1)		(29,012	)		(46,880	)		(84,548	)		(12,722	)		(33,351	)		(52,214	)		(7,857	)
Research and development expenses(1)		(20,385	)		(38,137	)		(100,186	)		(15,075	)		(40,178	)		(66,956	)		(10,075	)
General and administrative expenses(1)		(30,276	)		(54,931	)		(60,540	)		(9,109	)		(27,861	)		(37,466	)		(5,637	)
Total operating expenses		(79,673	)		(139,948	)		(245,274	)		(36,906	)		(101,390	)		(156,636	)		(23,569	)
Loss from operations		(30,936	)		(36,571	)		(45,672	)		(6,872	)		(28,256	)		(28,592	)		(4,303	)
Other income/(expense):
Foreign currency exchange gain/(loss)		296			(766	)		1,339			201			672			(889	)		(134	)
Interest income, net		87			180			80			12			26			189			28
Other income, net		9			373			111			17			—			(417	)		(63	)
Loss before income tax		(30,544	)		(36,784	)		(44,142	)		(6,642	)		(27,558	)		(29,709	)		(4,472	)
Income tax expenses		(130	)		(476	)		(4,693	)		(706	)		—			—			—
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)		(27,558	)		(29,709	)		(4,472	)

(1)

Share-based compensation was allocated in costs and operating expenses as follows:

	For the Year Ended December 31,								For the Six Months Ended June 30,
	2013		2014		2015				2015		2016
	RMB		RMB		RMB		US$		RMB		RMB		US$
	(in thousands)
Cost of revenues		32		71		335		50		146		182		27
Sales and marketing expenses		86		370		1,651		248		650		1,075		162
Research and development expenses		163		449		3,347		504		1,515		1,966		296
General and administrative expenses		2,013		2,992		3,473		523		1,642		2,049		308
Total		2,294		3,882		8,806		1,325		3,953		5,272		793

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Comparison of the Six Months Ended June 30, 2015 and 2016

Net Revenues

	For the Six Months Ended June 30,									Change
	2015			2016						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Revenues:
Enterprise		75,483			133,918			20,150			58,435			77	%
e-Government and other		10,029			16,648			2,505			6,619			66	%
Less: Business tax and surcharges		(878	)		(2,499	)		(376	)		(1,621	)		185	%
Net revenues		84,634			148,067			22,279			63,433			75	%

        Net revenues increased by RMB63.4 million, or 75%, from the six months ended June 30, 2015 to the six months ended June 30, 2016, with 77% and 66% growth rates in enterprise revenues and e-Government and other revenues, respectively. This growth was attributable to increased demand for our solutions from both new and existing customers.

Cost of Revenues

	For the Six Months Ended June 30,									Change
	2015			2016						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Cost of revenues		(11,500	)		(20,023	)		(3,013	)		(8,523	)		74	%

        Cost of revenues increased by RMB8.5 million, or 74%, from the six months ended June 30, 2015 to the six months ended June 30, 2016. The increase was a result of a RMB7.3 million increase in cost of customer service consultants, associated with an increase in headcount from 88 to 127, and a RMB1.2 million increase in bandwidth costs and allocated general overhead.

Gross Profit

	For the Six Months Ended June 30,						Change
	2015		2016				Amount		%
	RMB		RMB		US$		RMB
	(in thousands, except for percentages)
Gross profit		73,134		128,044		19,266		54,910		75	%

        Gross profit increased by RMB54.9 million, or 75%, from the six months ended June 30, 2015 to the six months ended June 30, 2016. Gross margin was 86% in the six months ended June 30, 2015 and remained 86% in the six months ended June 30, 2016.

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Operating Expenses

	For the Six Months Ended June 30,									Change
	2015			2016						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Operating expenses:
Sales and marketing expenses		(33,351	)		(52,214	)		(7,857	)		(18,863	)		57	%
Research and development expenses		(40,178	)		(66,956	)		(10,075	)		(26,778	)		67	%
General and administrative expenses		(27,861	)		(37,466	)		(5,637	)		(9,605	)		34	%
Total operating expenses		(101,390	)		(156,636	)		(23,569	)		(55,246	)		54	%

Sales and Marketing Expenses

        Sales and marketing expenses increased by RMB18.9 million, or 57%, from the six months ended June 30, 2015 to the six months ended June 30, 2016, due to a RMB18.5 million increase in sales personnel costs resulting from a headcount increase from 216 to 253 and a RMB2.9 million increase in travel, conference and allocated general overhead, offset by a RMB2.5 million decrease in professional fees.

Research and Development Expenses

        Research and development expenses increased by RMB26.8 million, or 67%, from the six months ended June 30, 2015 to the six months ended June 30, 2016, due to a RMB22.0 million increase in personnel costs associated with an increase in headcount from 224 to 382, a RMB2.9 million increase in patent application fees and other technical service fees, and a RMB1.9 million increase in allocated general overhead.

General and Administrative Expenses

        General and administrative expenses increased by RMB9.6 million, or 34%, from the six months ended June 30, 2015 to the six months ended June 30, 2016, due to a RMB3.4 million increase in personnel costs resulting from an increase in headcount from 76 to 106, and a RMB6.2 million increase in professional fees, allowance for doubtful accounts and allocated general overhead.

Comparison of 2014 and 2015

Net Revenues

	For the Year Ended December 31,									Change
	2014			2015						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Revenues:
Enterprise		104,891			208,157			31,321			103,266			98	%
e-Government and other		21,340			29,467			4,434			8,127			38	%
Less: Business tax and surcharges		(1,711	)		(2,785	)		(419	)		(1,074	)		63	%
Net revenues		124,520			234,839			35,336			110,319			89	%

        Net revenues increased by RMB110.3 million, or 89%, from 2014 to 2015, with 98% and 38% growth rates in enterprise revenues and e-Government and other revenues, respectively. This growth was attributable to increased demand for our solutions from new and existing customers. Total customers increased 45% to 307 customers in 2015 from 211 customers in 2014. Enterprise revenues

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increased RMB103.3 million due to a 48% increase in the number of customers from 163 to 242 and a 34% increase in average customer contribution from RMB643,503 to RMB860,153 (US$129,426). E-Government and other revenues increased RMB8.1 million due to an increase in the number of customers from 48 to 65 and a slight increase in average customer contribution from RMB444,583 to RMB453,338 (US$68,213).

Cost of Revenues

	For the Year Ended December 31,									Change
	2014			2015						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Cost of revenues		(21,143	)		(35,237	)		(5,302	)		(14,094	)		67	%

        Cost of revenues increased by RMB14.1 million, or 67%, from 2014 to 2015. The increase was a result of a RMB7.4 million increase in cost of customer service consultants, associated with an increase in headcount from 56 to 118, and a RMB6.7 million increase in bandwidth costs and overhead allocation.

Gross Profit

	For the Year Ended December 31,						Change
	2014		2015				Amount		%
	RMB		RMB		US$		RMB
	(in thousands, except for percentages)
Gross profit		103,377		199,602		30,034		96,225		93	%

        Gross profit increased by RMB96.2 million, or 93%, from 2014 to 2015, due to net revenues increasing at a higher pace than cost of revenues, reflecting higher average customer contribution in 2015 over 2014 and better leveraging of customer support personnel. Gross margin increased from 83% in 2014 to 85% in 2015.

Operating Expenses

	For the Year Ended December 31,									Change
	2014			2015						Amount			%
	RMB			RMB			US$			RMB
	(in thousands, except for percentages)
Operating expenses:
Sales and marketing expenses		(46,880	)		(84,548	)		(12,722	)		(37,668	)		80	%
Research and development expenses		(38,137	)		(100,186	)		(15,075	)		(62,049	)		163	%
General and administrative expenses		(54,931	)		(60,540	)		(9,109	)		(5,609	)		10	%
Total operating expenses		(139,948	)		(245,274	)		(36,906	)		(105,326	)		75	%

Sales and Marketing Expenses

        Sales and marketing expenses increased by RMB37.7 million, or 80%, from 2014 to 2015, due to a RMB24.5 million increase in sales personnel costs resulting from a headcount increase from 145 to 240, a RMB4.8 million increase in professional service fees and a RMB8.4 million increase in travel, marketing and allocated general overhead.

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Research and Development Expenses

        Research and development expenses increased by RMB62.0 million, or 163%, from 2014 to 2015, due to a RMB43.8 million increase in personnel costs resulting from a headcount increase from 158 to 279, a RMB8.3 million increase in patent application fee and university collaborations with the Harbin Institute of Technology and Renmin University of China, and a RMB7.1 million increase in research and development conference expenses and RMB2.8 million increase in allocated general overhead.

General and Administrative Expenses

        General and administrative expenses increased by RMB5.6 million, or 10%, from 2014 to 2015, due to a RMB10.2 million increase in general overhead, offset by a RMB4.6 million decrease in personnel costs. Although headcount increased from 66 to 96 in 2015, we recruited a number of junior support staff, including interns, and reallocated more experienced personnel to other operating departments, resulting in a decrease in personnel costs.

Comparison of 2013 and 2014

Net Revenues

	For the Year Ended December 31,						Change
	2013			2014			Amount			%
	(RMB in thousands, except for percentages)
Revenues:
Enterprise		57,025			104,891			47,866			84	%
e-Government and other		6,414			21,340			14,926			233	%
Less: Business tax and surcharges		(892	)		(1,711	)		(819	)		92	%
Net revenues		62,547			124,520			61,973			99	%

        Net revenues increased by RMB62.0 million, or 99%, from 2013 to 2014, with 84% and 233% year-over-year growth in enterprise and e-Government and other revenues, respectively. This growth was attributable to increased demand for our solutions from new and existing customers and the introduction of new products and services. Total customers increased 50% to 211 customers in 2014, from 141 customers in 2013. Enterprise revenues increased RMB47.9 million from 2013 to 2014 due to a 39% increase in the number of customers from 117 to 163, and a 32% increase in average customer contribution from RMB487,393 to RMB643,503. E-Government and other revenues increased RMB14.9 million due to an increase in the number of customers from 24 to 48 and an increase in average customer contribution from RMB267,250 to RMB444,583.

Cost of Revenues

	For the Year Ended December 31,						Change
	2013			2014			Amount			%
	(RMB in thousands, except for percentages)
Cost of revenues		(13,810	)		(21,143	)		(7,333	)		53	%

        Cost of revenues increased by RMB7.3 million, or 53%, from 2013 to 2014. The increase was a result of a RMB2.8 million increase in cost of customer service consultants, associated with an increase in headcount from 37 to 56, a RMB3.1 million increase in data center costs, bandwidth costs and allocated overhead, and a RMB1.4 million increase in a one-time hardware pass-through costs.

Gross Profit

	For the Year Ended December 31,				Change
	2013		2014		Amount		%
	(RMB in thousands, except for percentages)
Gross profit		48,737		103,377		54,640		112	%

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        Gross profit increased by RMB54.6 million, or 112%, from 2013 to 2014, due to net revenues increasing at a higher pace than cost of revenues, reflecting higher average customer contribution in 2014 over 2013 and better leveraging of customer support personnel. Gross margin increased from 78% in 2013 to 83% in 2014.

Operating Expenses

	For the Year Ended December 31,						Change
	2013			2014			Amount			%
	(RMB in thousands, except for percentages)
Operating expenses:
Sales and marketing expenses		(29,012	)		(46,880	)		(17,868	)		62	%
Research and development expenses		(20,385	)		(38,137	)		(17,752	)		87	%
General and administrative expenses		(30,276	)		(54,931	)		(24,655	)		81	%
Total operating expenses		(79,673	)		(139,948	)		(60,275	)		76	%

Sales and Marketing Expenses

        Sales and marketing expenses increased by RMB17.9 million, or 62%, from 2013 to 2014, due to a RMB8.5 million increase in sales personnel costs resulting from a headcount increase from 98 to 145, a RMB4.1 million increase in professional service fees, a RMB2.2 million increase in office leases and a RMB3.1 million increase in travel, marketing and allocated general overhead.

Research and Development Expenses

        Research and development expenses increased by RMB17.8 million, or 87%, from 2013 to 2014, due to a RMB8.0 million increase in personnel costs resulting from a headcount increase from 91 to 158, including an executive hire, a RMB0.9 million increase in allocated general overhead, a RMB1.6 million increase in office leases and a RMB2.4 million increase in the purchase of third-party software. In addition, we established two university collaborations, which resulted in a RMB4.9 million increase in university collaboration expenses.

General and Administrative Expenses

        General and administrative expenses increased by RMB24.7 million, or 81%, in 2014 compared to 2013, due to a RMB13.5 million increase in personnel costs resulting from a headcount increase from 42 to 66, including an executive hire, a RMB4.1 million increase in professional services and allocated general overhead, a RMB4.0 million increase in travel and a RMB3.1 million increase in office leases.

Quarterly Results of Operations

        The following table sets forth our unaudited consolidated statements of operations data for each of the eight quarters ended June 30, 2016. The information for each of these quarters has been prepared on the same basis as the audited annual consolidated financial statements included elsewhere in this prospectus and, in the opinion of our management, includes all adjustments of a normal, recurring nature that are necessary for the fair presentation of the results of operations for these periods in accordance with U.S. GAAP. You should read the following table in conjunction with our audited consolidated financial statements and related notes included elsewhere in this prospectus. The operating results for any quarter are not necessarily indicative of the operating results for any future period or for the full year.

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	For the Three Months Ended
	September 30, 2014			December 31, 2014			March 31, 2015			June 30, 2015			September 30, 2015			December 31, 2015			March 31, 2016			June 30, 2016
	(RMB in thousands)
Consolidated Statements of Operations Data:
Revenues:
Enterprise		29,595			37,608			33,367			42,116			53,729			78,945			58,701			75,217
e-Government and other		5,730			10,326			2,821			7,208			5,571			13,867			6,482			10,166
Less: Business tax and surcharges		(386	)		(954	)		(646	)		(232	)		(1,156	)		(751	)		(1,222	)		(1,277	)
Net revenues		34,939			46,980			35,542			49,092			58,144			92,061			63,961			84,106
Cost of revenues(1)		(5,356	)		(7,228	)		(5,826	)		(5,674	)		(9,134	)		(14,603	)		(9,267	)		(10,756	)
Gross profit		29,583			39,752			29,716			43,418			49,010			77,458			54,694			73,350
Operating expenses:
Sales and marketing expenses(1)		(12,081	)		(15,136	)		(14,321	)		(19,030	)		(27,345	)		(23,852	)		(24,141	)		(28,073	)
Research and development expenses(1)		(11,862	)		(13,249	)		(17,248	)		(22,930	)		(26,992	)		(33,016	)		(32,434	)		(34,522	)
General and administrative expenses(1)		(14,545	)		(15,192	)		(12,954	)		(14,907	)		(15,207	)		(17,472	)		(19,734	)		(17,732	)
Total operating expenses		(38,488	)		(43,577	)		(44,523	)		(56,867	)		(69,544	)		(74,340	)		(76,309	)		(80,327	)
Loss from operations		(8,905	)		(3,825	)		(14,807	)		(13,449	)		(20,534	)		3,118			(21,615	)		(6,977	)
Other income/(expense):
Foreign currency exchange gain/(loss)		803			(1,022	)		979			(307	)		911			(244	)		127			(1,016	)
Interest income, net		41			63			2			24			27			27			106			83
Other income, net		651			(278	)		—			—			—			111			115			(532	)
Loss before income tax		(7,410	)		(5,062	)		(13,826	)		(13,732	)		(19,596	)		3,012			(21,267	)		(8,442	)
Income tax expense		(96	)		(64	)		—			—			—			(4,693	)		—			—
Net loss		(7,506	)		(5,126	)		(13,826	)		(13,732	)		(19,596	)		(1,681	)		(21,267	)		(8,442	)
Non-GAAP Financial Data(2):
Adjusted net loss		(6,354	)		(3,931	)		(12,103	)		(11,502	)		(17,279	)		855			(18,604	)		(5,833	)
EBITDA		(5,483	)		(2,821	)		(10,976	)		(10,650	)		(16,277	)		6,729			(16,093	)		(2,953	)
Adjusted EBITDA		(4,331	)		(1,626	)		(9,253	)		(8,420	)		(13,960	)		9,265			(13,430	)		(344	)

(1)

Share-based compensation was allocated in costs and operating expenses as follows:

	For the Three Months Ended
	September 30, 2014		December 31, 2014		March 31, 2015		June 30, 2015		September 30, 2015		December 31, 2015		March 31, 2016		June 30, 2016
	(RMB in thousands)
Cost of revenues		28		28		49		97		94		95		87		95
Sales and marketing expenses		149		152		213		437		488		513		577		498
Research and development expenses		184		187		701		814		859		973		969		997
General and administrative expenses		791		828		760		882		876		955		1,030		1,019
Total		1,152		1,195		1,723		2,230		2,317		2,536		2,663		2,609

(2)

See"Prospectus Summary—Summary Consolidated Financial Data—Non-GAAP Financial Measures."

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        The following tables reconcile our adjusted net loss, EBITDA and adjusted EBITDA for each of the eight quarters ended June 30, 2016 to the most directly comparable financial measure calculated in accordance with U.S. GAAP, which is net loss:

	For the Three Months Ended
	September 30, 2014			December 31, 2014			March 31, 2015			June 30, 2015			September 30, 2015			December 31, 2015			March 31, 2016			June 30, 2016
	(RMB in thousands)
Reconciliation of Net Loss to Adjusted Net Loss:
Net loss		(7,506	)		(5,126	)		(13,826	)		(13,732	)		(19,596	)		(1,681	)		(21,267	)		(8,442	)
Share-based compensation		1,152			1,195			1,723			2,230			2,317			2,536			2,663			2,609
Adjusted net loss		(6,354	)		(3,931	)		(12,103	)		(11,502	)		(17,279	)		855			(18,604	)		(5,833	)

	For the Three Months Ended
	September 30, 2014			December 31, 2014			March 31, 2015			June 30, 2015			September 30, 2015			December 31, 2015			March 31, 2016			June 30, 2016
	(RMB in thousands)
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA:
Net loss		(7,506	)		(5,126	)		(13,826	)		(13,732	)		(19,596	)		(1,681	)		(21,267	)		(8,442	)
Interest income, net		(41	)		(63	)		(2	)		(24	)		(27	)		(27	)		(106	)		(83	)
Income tax		96			64			—			—			—			4,693			—			—
Depreciation and amortization expenses		1,968			2,304			2,852			3,106			3,346			3,744			5,280			5,572
EBITDA		(5,483	)		(2,821	)		(10,976	)		(10,650	)		(16,277	)		6,729			(16,093	)		(2,953	)
Share-based compensation		1,152			1,195			1,723			2,230			2,317			2,536			2,663			2,609
Adjusted EBITDA		(4,331	)		(1,626	)		(9,253	)		(8,420	)		(13,960	)		9,265			(13,430	)		(344	)

Quarterly Net Revenue Trends

        Our quarterly net revenues generally increased across these quarterly periods due to increased sales to new customers, as well as increasing sales to existing customers. Our quarterly results reflected seasonality in the sale of our solutions. Historically, we believe a pattern of increased sales in the fourth fiscal quarter as a result of seasonal buying patterns had positively impacted net revenues in that period, which resulted in low or negative sequential net revenue growth in the first quarter as compared to the prior quarter. Such seasonality has resulted in a decrease in quarterly net revenues from the fourth quarter of a year to the first quarter of the subsequent year. Our gross margins and operating income (losses) have also been affected by these historical trends because the majority of our expenses are relatively fixed in the short term. In addition, sales and marketing expenses typically increase towards the end of the year as a result of year-end commissions. We believe that we may experience seasonality in our business in the future. We cannot assure you about any particular revenue level in any future period.

Quarterly Expense Trends

        Sales and marketing, research and development, and general and administrative expenses generally increased sequentially over the periods as we increased our headcount to support continued investment in our products. The increase in personnel costs was related to increases in headcount, along with higher share-based compensation expense. However, research and development expenses were slightly lower in the first quarter of 2016 than in the fourth quarter of 2015, primarily due to high expenses

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related to technical and sales conferences in the fourth quarter of 2015. General and administrative expenses were lower in the second quarter of 2016 than in the first quarter of 2016, primarily due to high travel and meeting expenses for business planning in the first quarter of 2016.

Liquidity and Capital Resources

        The following table sets forth the movements of our cash and cash equivalents for the periods presented:

	For the Year Ended December 31,												For the Six Months Ended June 30,
	2013			2014			2015						2015			2016
	RMB			RMB			RMB			US$			RMB			RMB			US$
	(in thousands)
Net cash (used in)/provided by operating activities		(44,426	)		4,773			(99,840	)		(15,023	)		(170,720	)		(75,818	)		(11,409	)
Net cash used in investing activities		(6,812	)		(25,931	)		(20,705	)		(3,115	)		(9,024	)		(17,702	)		(2,664	)
Net cash provided by financing activities		102,934			4,000			257,500			38,745			261,500			10,400			1,565
Effect of exchange rate changes on cash and cash equivalents		(2,385	)		1,028			(262	)		(39	)		(2,871	)		260			41
Net increase/(decrease) in cash and cash equivalents		49,311			(16,130	)		136,693			20,568			78,885			(82,860	)		(12,467	)
Cash and cash equivalents at the beginning of the year/period		28,649			77,960			61,830			9,303			61,830			198,523			29,871
Cash and cash equivalents at the end of the year/period		77,960			61,830			198,523			29,871			140,715			115,663			17,404

Cash and Cash Equivalents

        As of June 30, 2015 and 2016, our total cash and cash equivalents were RMB140.7 million and RMB115.7 million (US$17.4 million), respectively. Our cash and cash equivalents decreased by RMB25.0 million from June 30, 2015 to June 30, 2016, primarily due to cash outflow from our operating and investing activities.

        In June 2016, Beijing Gridsum, one of our consolidated affiliated entities, entered into a short-term guaranteed revolving credit facility with China Merchants Bank with maximum amount of RMB25.0 million (US$3.8 million), a fixed interest rate of 5.44% per annum and a term of twelve months. The guarantee was provided by our chief executive officer and chairman, and Beijing Moment. As of June 30, 2016, we borrowed RMB10.0 million (US$1.5 million) under this credit facility.

        We believe that our existing cash and cash equivalents balance as of June 30, 2016 is sufficient to fund our operating activities, capital expenditures and other obligations for at least the next twelve months. However, we may decide to enhance our liquidity position or increase our cash reserve for future expansions and acquisitions through additional sales of equity or debt securities, or other borrowing arrangements. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of additional indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations.

        Our future capital requirements will depend on many factors, including our growth rate, the timing and extent of spending to support research and development efforts, the continued expansion of sales and marketing activities, the introduction of new and enhanced products, and the continued market acceptance of our products. In the event that additional financing is required from outside sources, we may not be able to raise such financing on terms acceptable to us or at all. If we are unable to raise

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additional capital when desired, our business, operating results and financial condition would be adversely affected.

        In utilizing the proceeds we expect to receive from this offering and the other cash that we hold offshore, we may (i) make additional capital contributions to our PRC subsidiary, (ii) establish new PRC subsidiaries and make capital contributions to these new PRC subsidiaries, (iii) make loans to our PRC subsidiary or consolidated affiliated entities or (iv) acquire offshore entities with business operations in China in offshore transactions. However, most of these uses are subject to PRC regulations and approvals. For example:

•

capital contributions to our PRC subsidiary or consolidated affiliated entities, whether existing or newly established ones, must be approved by the MOFCOM or its local counterparts; and

•

loans by us to finance the activities of our PRC subsidiary, which is a foreign-invested enterprise, cannot exceed statutory limits and must be registered with SAFE or its local branches.

        See "PRC Regulation—Regulations on Foreign Exchange."

        Substantially all of our future revenues are likely to continue to be in the form of RMB. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior SAFE approval as long as certain routine procedural requirements are fulfilled. Therefore, our PRC subsidiary is allowed to pay dividends in foreign currencies to us without prior SAFE approval by following certain routine procedural requirements. However, approval from or registration with competent government authorities is required where the RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may at its discretion restrict access to foreign currencies for current account transactions in the future. See "Risk Factors—Risks Relating to Doing Business in China—Governmental control of currency conversion may limit our ability to pay dividends and other obligations and affect the value of your investment."

Operating Activities

        Net cash used in operating activities in the six months ended June 30, 2016 was RMB75.8 million (US$11.4 million), reflecting a net loss of RMB29.7 million (US$4.5 million), an increase of RMB151.9 million (US$22.9 million) in accounts receivable and prepayments and other current asset, and a decrease of RMB0.7 million (US$0.1 million) in salary and welfare payable, partially offset by an increase of RMB88.0 million (US$13.2 million) in total other current liabilities. The principal non-cash items accounting for the difference between the net loss and the cash used in operating activities in the six months ended June 30, 2016 were RMB10.9 million (US$1.6 million) in depreciation and amortization expenses, RMB5.3 million (US$0.8 million) in share-based compensation expense, RMB1.3 million (US$0.2 million) in provision for allowance for doubtful accounts and RMB0.9 million (US$0.1 million) in foreign currency exchange gain.

        Compared to the six months ended June 30, 2015, net cash used in operating activities in the six months ended June 30, 2016 decreased from RMB 170.7 million to RMB75.8 million (US$11.4 million). The decreased cash outflow was primarily attributable to a temporary extension of credit term from a search engine service provider, according to a three-party joint agreement among us, a large customer and the search engine service provider. The remaining decrease was due to smaller amount of deposits to search engine service providers and prepayment to suppliers. The decrease was partially offset by an increase in investment in accounts receivable for certain low risk customers. The amount of payments to search engine service providers on behalf of customers included in accounts receivable was RMB186.0 million and RMB354.6 million (US$53.4 million) as of June 30, 2015 and June 30, 2016, respectively. When we provide the bid management services to our customers, customer

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spending on search engine service providers will pass through our accounts. The flow of the fund has impact on several accounts, including accounts receivable, accounts payable, deferred revenues and advance from customers.

        Net cash used in operating activities in the six months ended June 30, 2015 was RMB170.7 million, reflecting a net loss of RMB27.6 million, an increase of RMB176.1 million in accounts receivable and prepayments and other current asset, a decrease of RMB4.6 million in salary and welfare payable, and a decrease of RMB4.2 million in accrued expenses and other current liabilities, offset partially by an increase of RMB32.2 million in total other current liabilities. The principal non-cash items accounting for the difference between the net loss and the cash used in operating activities in the six months ended June 30, 2015 were RMB6.0 million in depreciation and amortization expenses and RMB4.0 million in share-based compensation expense.

        Net cash used in operating activities in 2015 was RMB99.8 million (US$15.0 million), reflecting a net loss of RMB48.8 million (US$7.3 million), an increase of RMB192.5 million (US$29.0 million) in accounts receivable and an increase of RMB59.4 million (US$8.9 million) in prepayment and other current assets, offset partially by an increase of RMB179.0 million (US$26.9 million) in total current liabilities. The principal non-cash items accounting for the difference between the net loss and the cash used in operating activities in 2015 were RMB13.0 million (US$2.0 million) in depreciation and amortization expenses and RMB8.8 million (US$1.3 million) in share-based compensation expense. Net cash provided by operating activities in 2014 was RMB4.8 million, while net cash used in operating activities in 2015 was RMB99.8 million (US$15.0 million). The increased cash outflow was primarily attributable to investment in working capital for certain low risk customers, to which a longer credit period was granted. The remaining increase was due to larger amount of deposits to search engine service providers and prepayment to suppliers with the expansion of our business. The amount of payments to search engine service providers on behalf of customers included in accounts receivable was RMB66.4 million and RMB230.9 million (US$34.7 million) as of December 31, 2014 and 2015, respectively.

        Net cash provided by operating activities in 2014 was RMB4.8 million. The improvement in operating cash flow was caused by better cash collection from customers, which resulted in increase of RMB53.4 million in advances from customers and an increase of RMB10.6 million in deferred revenues, partially offset by an increase of RMB26.1 million in accounts receivables and prepayment and other current assets, and a decrease of RMB7.0 million in total other current liabilities. Operating cash flow was also positively impacted by RMB7.0 million in depreciation and amortization expenses, and RMB3.9 million in share-based compensation expenses. This was offset in part by a net loss of RMB37.3 million.

        Net cash used in operating activities in 2013 was RMB44.4 million as a result of a net loss of RMB30.7 million, and increases of RMB33.7 million in accounts receivable and RMB20.7 million in prepayment and other current assets. This was offset by RMB3.7 million in depreciation and amortization expenses, and RMB2.3 million in share-based compensation expenses. Operating cash flow was also positively impacted by increases of RMB22.1 million in accounts payable, RMB2.4 million in deferred revenues and RMB9.9 million in other current liabilities.

Investing Activities

        Net cash used in investing activities in the six months ended June 30, 2016 was RMB17.7 million (US$2.7 million), representing purchases of property and equipment of RMB17.8 million (US$2.7 million).

        Net cash used in investing activities in the six months ended June 30, 2015 was RMB9.0 million, representing purchases of property and equipment of RMB9.0 million.

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        Net cash used in investing activities in 2015 was RMB20.7 million (US$3.1 million), representing purchase of property and equipment of RMB20.7 million (US$3.1 million).

        Net cash used in investing activities in 2014 was RMB25.9 million, representing purchase of property and equipment of RMB25.9 million.

        Net cash used in investing activities in 2013 was RMB6.8 million reflecting RMB6.8 million for the purchase of property and equipment.

Financing Activities

        Net cash provided by financing activities in the six months ended June 30, 2016 was RMB10.4 million (US$1.6 million), primarily due to drawdown under a revolving credit facility.

        Net cash provided by financing activities in the six months ended June 30, 2015 was RMB261.5 million, primarily due to the sale and issuance of Series C preferred shares to private investors for RMB262.6 million, offset by RMB1.1 million of transaction-related expenses.

        Net cash provided by financing activities in 2015 was RMB257.5 million (US$38.7 million), primarily due to the sale and issuance of Series C preferred shares to private investors for RMB262.6 million, offset by RMB1.1 million (US$0.2 million) of transaction-related expenses and RMB4.0 million (US$0.6 million) repayment of bank loan.

        Net cash provided by financing activities in 2014 was RMB4.0 million primarily due to a bank loan we obtained to establish our credit history.

        Net cash provided by financing activities in 2013 was RMB102.9 million primarily due to the sales of series B preferred shares to private investors for RMB107.1 million, offset by RMB4.2 million of the transaction-related expenses.

Contractual Obligations

        The following table sets forth our contractual obligations as of December 31, 2015:

	Year ending December 31,
	Total		2016		2017		2018		2019		2020 and thereafter
	(RMB in thousands)
Operating lease commitments		14,207		9,899		2,816		1,492		—		—
Total		14,207		9,899		2,816		1,492		—		—

        The following table sets forth our contractual obligations as of June 30, 2016:

	Year ending December 31,
	Total		2016		2017		2018		2019		2020 and thereafter
	(RMB in thousands)
Operating lease commitments		18,908		7,528		6,424		3,993		963		—
Short-term borrowing		10,000		—		10,000		—		—		—
Total		28,908		7,528		16,424		3,993		963		—

        Operating lease commitments consist of the commitments under the lease agreements for our office premises. We lease our office facilities under non-cancelable operating leases with various expiration dates through three years. Our leasing expense was RMB6.4 million, RMB15.1 million,

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RMB17.7 million (US$2.7 million) and RMB13.1 million (US$2.0 million) in 2013, 2014, 2015 and the six months ended in June 30, 2016, respectively.

        Other than those shown above, we did not have any significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2015 and June 30, 2016.

Internal Control over Financial Reporting

        Prior to this offering, we have been a private company with limited accounting personnel and other resources with which to address our internal control over financial reporting. Our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. However, in the course of auditing our consolidated financial statements as of and for the years ended December 31, 2013, 2014 and 2015, we and our independent registered public accounting firm identified one material weakness and certain other deficiencies in our internal control over financial reporting, each as defined in the standards established by the Public Company Accounting Oversight Board of the United States. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

        The material weakness relates to our lack of sufficient financial reporting and accounting personnel with appropriate knowledge of U.S. GAAP and SEC reporting requirements to properly address complex accounting issues and to prepare and review our consolidated financial statements and related disclosures in accordance with U.S. GAAP and SEC financial reporting requirements.

        We have taken initiatives to improve our internal control over financial reporting to address the material weakness that has been identified, including: hiring an additional senior financial reporting manager, an internal control manager, and three financial analysts with experience in U.S. GAAP accounting and SEC reporting to lead accounting and financial reporting matters; designating more resources to improve the period-end closing procedures for financial statements and relevant disclosures preparation; and taking steps to establish an audit committee prior to completion of this offering, with members who have an appropriate level of financial expertise to oversee our accounting and financial reporting processes as well as our external and internal audits.

        We have also taken other steps to strengthen our internal control over financial reporting, including preparing a contracts tracking database, formalizing a set of comprehensive U.S. GAAP accounting manuals, establishing an internal audit function, continuing to hire qualified professionals with sufficient U.S. GAAP accounting and SEC reporting experience, providing relevant training to our accounting personnel and upgrading our financial reporting system to streamline monthly and year-end closings and integrate financial and operating reporting systems.

        However, we cannot assure you that we will complete implementation of these measures in a timely manner. See "Risk Factors—Risks Related to Our Business—We have identified a material weakness and certain other deficiencies in our internal controls as of December 31, 2015, and if we fail to maintain an effective system of internal controls, our ability to accurately and timely report our financial results or prevent fraud may be adversely affected, and investor confidence and the market price of the ADSs may be adversely affected."

Holding Company Structure

        We are a holding company with no material operations of our own. We conduct our operations primarily through our wholly owned subsidiary and consolidated affiliated entities established in the PRC. As a result, our ability to pay dividends depends upon dividends paid to us by the WFOE, our PRC subsidiary. If the WFOE, or any other newly formed subsidiary of ours, incurs debt on its own

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behalf in the future, the instruments governing its debt may restrict its ability to pay dividends to us. In addition, the WFOE is permitted to pay dividends to us only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, the WFOE is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, the WFOE may allocate a portion of its after-tax profits to staff welfare and bonus funds, a discretionary surplus fund and an enterprise expansion fund at its discretion or in accordance with its articles of association.

        These reserve funds and staff welfare and bonus funds are not distributable as cash dividends. In addition, registered capital and capital reserve accounts are restricted from withdrawal in the PRC, up to the amount of net assets held in such entity. As of June 30, 2016, the amount restricted was RMB124.0 million (US$18.7 million). The WFOE has never paid dividends and will not be able to pay dividends until it generates accumulated profits and has satisfied the requirements for statutory reserve funds.

Off-Balance Sheet Commitments and Arrangements

        We have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any unconsolidated third parties. In addition, we have not entered into any derivative contracts that are indexed to our shares and classified as shareholders' equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. Moreover, we do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.

Inflation

        To date, inflation in China has not materially impacted our results of operations. According to the PRC National Bureau of Statistics, the year-over-year percent changes in the consumer price index for December 2013, 2014 and 2015 were increases of 2.6%, 2.0% and 1.4%, respectively. Although we have not been materially affected by inflation in the past, we can provide no assurance that we will not be affected in the future by higher rates of inflation in China.

Market Risks

Foreign Exchange Risk

        Substantially all of our revenues and costs are denominated in RMB, and a significant portion of our financial assets are also denominated in RMB. We do not believe that we currently have any significant direct foreign exchange risk and we have not entered into any hedging transactions in an effort to reduce our exposure to foreign currency exchange risk. Although in general our exposure to foreign exchange risks should be limited, the value of your investment in our ADSs will be affected by the exchange rate between the U.S. Dollar and the RMB because the value of our business is effectively denominated in RMB, while our ADSs will be traded in U.S. Dollars.

        The value of the RMB against the U.S. Dollar and other currencies is affected by changes in China's political and economic conditions and China's foreign exchange policies, among other things. On July 21, 2005, the PRC government changed its decades-old policy of pegging the value of the RMB to the U.S. Dollar, and the RMB appreciated more than 20% against the U.S. Dollar over the following three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the RMB and the U.S. Dollar remained within a narrow band. The PRC government has allowed the RMB to appreciate slowly against the U.S. Dollar again, and as of June 30, 2016, it had appreciated more than 2.0% since June 30, 2010, though there also have been periods when it

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depreciated against the U.S. Dollar. During a three-day period in August 2015, the RMB depreciated approximately 3.0% against the U.S. Dollar. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the U.S. Dollar in the future. In addition, there remains significant international pressure on the PRC government to adopt a substantial liberalization of its currency policy, which could result in further appreciation in the value of the RMB against the U.S. Dollar.

        To the extent that we need to convert U.S. Dollars into RMB for our operations, appreciation of the RMB against the U.S. Dollar would have an adverse effect on the RMB amount we receive from the conversion. Conversely, if we decide to convert RMB into U.S. Dollars for the purpose of making payments for dividends on our ordinary shares or ADSs or for other business purposes, appreciation of the U.S. Dollar against the RMB would have a negative effect on the U.S. Dollar amounts available to us.

        As of June 30, 2016, we had RMB-denominated cash and cash equivalents of RMB112.2 million, and U.S. Dollar-denominated cash and cash equivalents of US$0.5 million. Assuming we had converted RMB112.2 million into U.S. Dollars at the exchange rate of RMB6.6459 for US$1.00 as of June 30, 2016, our U.S. Dollar cash and cash equivalents would have been US$17.4 million. If the RMB had depreciated by 10% against the U.S. Dollar, our U.S. Dollar cash and cash equivalents would have been US$15.8 million instead. Assuming we had converted US$0.5 million into RMB at the exchange rate of RMB6.6459 for US$1.00 as of June 30, 2016, our RMB cash and cash equivalents would have been RMB115.5 million. If the RMB had depreciated by 10% against the U.S. Dollar, our RMB cash and cash equivalents would have been RMB115.9 million instead.

Interest Rate Risk

        Our exposure to interest rate risk primarily relates to the interest income generated by excess cash, which is mostly held in interest-bearing bank deposits. Interest-earning instruments carry a degree of interest rate risk. We have not been exposed to material risks due to changes in interest rates, and we have not used any derivative financial instruments to manage our interest risk exposure. However, our future interest income may fall short of expectations due to changes in market interest rates.

Critical Accounting Policies, Judgments and Estimates

        Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP, appearing elsewhere in this prospectus. The preparation of these consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent assets and liabilities. We evaluate these estimates, judgments and assumptions on an on-going basis for taxes.

        Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. These estimates form the basis for our judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from such estimates under different assumptions or conditions.

        We believe the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements:

Consolidation of Variable Interest Entities

        To comply with applicable PRC laws and regulations, we conduct operations in China principally through our PRC-based variable interest entity and its operating subsidiaries. One of our wholly owned subsidiaries has entered into a series of contractual arrangements with our PRC-based variable interest

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entity and its shareholders. These contractual arrangements allow us to exercise effective control over, and receive substantially all of the economic benefits, of our PRC-based variable interest entity and its operating subsidiaries, and we treat it and its operating subsidiaries as variable interest entities under U.S. GAAP, the financial results of which are included in our consolidated financial statements. See "Corporate History and Structure."

Revenue Recognition

        Revenues are generated from sales of our marketing automation and e-Government and other solutions. The targeted customers for marketing automation solutions are enterprise customers and the targeted customers for e-Government and other solutions are governmental agencies and state-owned entities.

        We recognize revenues when the following four criteria are met:

•

persuasive evidence of an arrangement exists;

•

our platform is made available and services have been delivered to the customer;

•

the fee is fixed or determinable; and

•

collection is reasonably assured.

        Revenues received from incentive programs of search engine providers are based on the amount of ad spending on those search engine platforms by our customers and other factors, and are calculated in accordance with our customers' usage of the search engine providers. Revenues are recorded net of value-added taxes and surcharges.

        In accordance with ASC 605-45, Revenue Recognition: Principal Agent Considerations, we consider several factors in determining whether we act as the principal or as an agent in the arrangement of merchandise sales and provision of various related services and thus whether it is appropriate to record our revenues and the related cost of sales on a gross basis or record the net amount earned as service fees.

        Where customers purchase multiple solutions in a single contract, we allocate the total consideration to the various elements based on the relative selling price method and recognize revenues as services are rendered. In accordance with ASC 605-25, Revenue Recognition—Multiple-Element Arrangements, the following hierarchy are followed when determining the appropriate selling price for each element: (1) vendor specific objective evidence, or VSOE, (2) third party evidence, or TPE and (3) best estimate of selling price, or BESP. We recognize revenues based on the elements delivered and defer the recognition of revenues for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, revenues are recognized on a straight line basis over the contract period.

Enterprise

        We generate enterprise revenue primarily by providing our marketing automation solutions, including bid management and data analysis solutions, to enterprise customers. We earn and record service fee revenues over the contractual period, in proportion to ad spending or the completion of milestones that are stipulated in the contracts. In addition, we receive revenues from the incentive programs of search engine providers based on factors determined by them, such as yearly growth in the amount of advertising on the provider's search engine platform that our customers purchase through our solutions and other factors selected at the discretion of these providers. Revenues from these programs are received on both a quarterly and an annual basis and are calculated in accordance with our customers' usage of the search engine providers.

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        With respect to the bid management services, we considered that: (i) the search engines are responsible for providing the advertisements service to the customers; (ii) we lack the latitude to determine the prices charged by the search engine providers and earns only the fixed service fee from the customers; (iii) the hosting and maintenance of the advertisements are the responsibilities of the search engine providers; (iv) the customers have the discretion in choosing the search engines selection; and (v) we receive revenues from incentive programs based on the search engines providers' policies. It is our responsibility to manage the customer's advertising campaign on the search engines providers, according to the terms of the customer contract, so we view ourselves as an agent and record revenues related to these services on a net basis.

e-Government and Other

        We generate revenue by entering into service contracts with governmental agencies for our e-Government solutions, including Law Dissector beginning in 2015. We also generate revenue by entering into contracts with state-owned television stations for our new media solutions, including TV Dissector, Streaming Dissector and Video Dissector.

Fair Value of our Ordinary Shares

        We are a private company with no quoted market prices for our ordinary shares. We therefore need to make estimates of the fair value of our ordinary shares at various dates for the purposes of: (i) determining the fair value of our ordinary shares at the date of issuance of convertible instruments as one of the inputs into determining the intrinsic value of the beneficial conversion features, if any; (ii) determining the fair value of preferred shares and ordinary shares at the respective issuance date; and (iii) determining the fair value of our ordinary shares at the date of grant of a share-based compensation award to our employees as one of the inputs into determining the grant date fair value of the award.

        The following table sets forth the fair value of our ordinary shares estimated at different times with the assistance from an independent valuation firm.

Valuation Dates	Fair value per share	Discount rate	DLOM	Type of valuation
December 31, 2012	US$1.51	22.5%	30%	Retrospective
October 1, 2013	US$2.64	21.5%	25%	Retrospective
December 31, 2013	US$2.75	20.0%	20%	Retrospective
July 1, 2014	US$5.47	20.0%	20%	Retrospective
December 31, 2014	US$6.82	20.0%	15%	Retrospective
January 30, 2015	US$7.93	19.5%	10%	Contemporaneous
March 1, 2015	US$7.94	19.0%	10%	Contemporaneous
June 30, 2015	US$11.80	18.5%	7%	Contemporaneous
September 30, 2015	US$11.84	18.5%	8%	Contemporaneous
November 18, 2015	US$11.84	18.5%	9%	Contemporaneous

        In determining the fair value of our ordinary shares, we applied the income approach/discounted cash flow analysis based on our best estimate of projected cash flow as of the valuation date. The determination of the fair value of our ordinary shares requires complex and subjective judgments to be made regarding our projected financial and operating results, our unique business risks, the liquidity of our shares and our operating history and prospects at the time of valuation.

        The major assumptions used in calculating the fair value of ordinary shares include:

•

Discount rates. The discount rates listed in the table above were based on the weighted average cost of capital, which was determined based on a consideration of the factors including risk-free

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rate, comparative industry risk, equity risk premium, company size and non-systematic risk factors.

•

Comparable companies. In deriving the weighted average cost of capital used as the discount rates under the income approach, ten publicly traded companies were selected for reference as our guideline companies. The guideline companies were selected based on the following criteria: (i) they operate in digital marketing and big data analytics industry; and (ii) their shares are publicly traded in developed capital markets, including the United States.

•

Discount for lack of marketability, or DLOM. DLOM was quantified by the Finnerty's (2012) Average-Strike Put Option model. Under this option pricing method, the cost of the put option, which can hedge the price change before the privately held shares can be sold, was considered as a basis to determine the DLOM. This option pricing method is one of the methods commonly used in estimating DLOM as it can take into consideration factors like timing of a liquidity event, such as an initial public offering, and estimated volatility of our shares. The farther the valuation date is from an expected liquidity event, the higher the put option value and thus the higher the implied DLOM. The lower DLOM is used for the valuation, the higher is the determined fair value of the ordinary shares.

•

The income approach involves applying appropriate discount rates to estimated cash flows that are based on earnings forecasts. Our revenues and earnings growth rates, as well as major milestones that we have achieved, contributed to the increase in the fair value of our ordinary shares from December 2012 to November 2015. However, these fair values are inherently uncertain and highly subjective. The assumptions used in deriving the fair values are consistent with our business plan. These assumptions include: no material changes in the existing political, legal and economic conditions in the PRC; our ability to retain competent management, key personnel and staff to support our ongoing operations; and no material deviation in market conditions from economic forecasts. These assumptions are inherently uncertain.

•

Option pricing method was used to allocate enterprise value to preferred and ordinary shares, taking into account the guideline prescribed by the AICPA Audit and Accounting Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation. The method treats common stock and preferred stock as call options on the enterprise's value, with exercise prices based on the liquidation preference of the preferred stock.

•

The option pricing method involves making estimates of the anticipated timing of a potential liquidity event, such as a sale of our company or an initial public offering, and estimates of the volatility of our equity securities. The anticipated timing is based on the plans of our board of directors and management. Estimating the volatility of the share price of a privately held company is complex because there is no readily available market for the shares. We estimated the volatility of our shares to range from 37.7% to 51.3% based on the historical volatilities of comparable publicly traded companies engaged in similar lines of business. Had we used different estimates of volatility, the allocations between preferred and ordinary shares would have been different.

Share-based Compensation

        All share-based awards to employees and directors, including stock option awards, are measured at the grant date based on the fair value of the awards. Share-based compensation, net of forfeitures, is recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. We used the binominal option pricing model to determine the fair value of stock options and account for share-based compensation expenses using an estimated forfeiture rate at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Share-based compensation expenses were recorded net of estimated forfeitures such that expenses were

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recorded only for those share-based awards that are expected to vest. Historically, our share-based compensation expenses were relatively low.

        In 2014, we amended our stock option plan, which we originally adopted in 2011. We refer to this plan as the 2014 Plan. A maximum of 2,500,000 Class B ordinary shares may be granted under the 2014 Plan. The 2014 Plan will terminate automatically in December 2019, unless terminated earlier.

        A summary of our stock option activities is presented below.

Date of Tranche	Number of Options Granted	Exercise Price	Fair Value of the Options as of the Grant Date	Fair Value of the Underlying Ordinary Shares as of the Grant Date	Intrinsic Value as of the Grant Date
September 1, 2013	78,125	US$0.42	US$2.26	US$2.64	US$2.22
January 1, 2014	31,250	US$0.42	US$2.38	US$2.75	US$2.33
February 10, 2014	198,893	US$0.42	US$2.37	US$2.75	US$2.33
July 1, 2014	164,000	US$0.42	US$5.08	US$5.47	US$5.05
December 10, 2014	198,893	US$0.42	US$6.43	US$6.82	US$6.40
March 1, 2015	223,000	US$0.42	US$7.55	US$7.94	US$7.52
June 30, 2015	30,000	US$0.42	US$11.41	US$11.80	US$11.38
September 30, 2015	24,000	US$0.42	US$11.44	US$11.84	US$11.42
October 16, 2015	25,000	US$0.42	US$11.44	US$11.84	US$11.42
November 18, 2015	29,000	US$0.42	US$11.44	US$11.84	US$11.42

        The fair value of each option grant is estimated on the date of grant. The following table summarizes assumptions used in the fair value estimates on the dates indicated.

Date of Tranche	Expected Volatility(1)	Risk-Free Interest Rate (Per Annum)(2)	Expected Dividend Yield(3)	Expected Term (in Years)(4)	Expected Forfeiture Rate(5)
September 1, 2013	47%	3.56%	—	2.2	3%
January 1, 2014	52%	3.63%	—	2.2	3%
February 10, 2014	52%	3.27%	—	2.2	3%
July 1, 2014	52%	3.17%	—	2.2	3%
December 10, 2014	50%	2.77%	—	2.2	3%
March 1, 2015	49%	2.59%	—	2.2	3%
June 30, 2015	48%	2.95%	—	2.2	3%
September 30, 2015	47%	2.64%	—	2.2	3%
October 16, 2015	46%	2.63%	—	2.2	3%
November 18, 2015	46%	2.87%	—	2.2	3%

(1)

We estimated expected volatility based on the annualized standard deviation of the daily return embedded in historical share prices of comparable companies with a time horizon close to the expected expiration of the term.

(2)

We estimated the risk-free interest rate based on the yield of U.S. Treasury bills with maturity terms similar to the expected terms on the share-based awards.

(3)

We have never declared or paid any cash dividends on our capital stock, and we do not anticipate any dividend payments on our ordinary shares in the foreseeable future.

(4)

Expected term (in years) represents the weighted average period of time that share-based awards granted are expected to be outstanding giving consideration to historical exercise patterns. We used the simplified method to calculate the expected term.

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(5)

Expected forfeiture rate is estimated based on historical employee turnover rate after each option grant.

        For the purpose of determining the estimated fair value of our stock options, we believe the expected volatility and the estimated fair value of our ordinary shares are the most critical assumptions. Changes in these assumptions could significantly affect the fair value of stock options and hence the amount of share-based compensation we recognize in our combined and consolidated financial statements. Since we did not have a trading history for our shares sufficient to calculate our own historical volatility, the expected volatility of our future ordinary share price was estimated based on the price volatility of the shares of comparable public companies that operate in the same or similar business.

Income Taxes

        Current income taxes are provided on the basis of net income/(loss) for financial reporting purposes, and adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are provided using the liability method. Under this method, deferred tax assets and liabilities are recognized for the tax effects of temporary differences and are determined by applying enacted statutory tax rates that will be in effect in the period in which the temporary differences are expected to reverse to the temporary differences between the financial statements' carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to reduce the amount of deferred tax assets if, based on the weight of available evidence, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized.

        We apply a "more likely than not" recognition threshold in the evaluation of uncertain tax positions. We recognize the benefit of a tax position in our consolidated financial statements if the tax position is "more likely than not" to prevail based on the facts and technical merits of the position. Tax positions that meet the "more likely than not" recognition threshold are measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. Unrecognized tax benefits may be affected by changes in interpretation of laws, rulings of tax authorities, tax audits and expiry of statutory limitations. In addition, changes in facts, circumstances and new information may require us to adjust the recognition and measurement estimates with regard to individual tax positions. Accordingly, unrecognized tax benefits are periodically reviewed and re-assessed. Adjustments, if required, are recorded in our consolidated financial statements in the period in which the change that necessities the adjustments occur. The ultimate outcome for a particular tax position may not be determined with certainty prior to the conclusion of a tax audit and, in certain circumstances, a tax appeal or litigation process.

Recent Accounting Pronouncements

        In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)." This guidance supersedes current guidance on revenue recognition in Topic 605, "Revenue Recognition." In addition, there are disclosure requirements related to the nature, amount, timing, and uncertainty of revenue recognition. This guidance will be effective for annual reporting periods beginning after December 15, 2016, including interim reporting periods, and will be required to be applied either retrospectively or modified retrospectively. Early application of the guidance is not permitted. In August 2015, the FASB issued ASU No. 2015-14 to defer the effective date of ASU No. 2014-09 for all entities by one year. Therefore, we will adopt this guidance for its 2018 fiscal year. We are currently evaluating the impact of this guidance and the method of adoption.

        In June 2014, the FASB issued ASU No. 2014-12, "Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite

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Service Period". The new standard requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718, Compensation-Stock Compensation, as it relates to awards with performance conditions that affect vesting to account for such awards. The performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. The amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. We do not expect this guidance to have a material effect on our consolidated financial statements at the time of adoption of this standard.

        In August 2014, the FASB issued ASU No. 2014-15, "Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." The new standard addresses management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. Management's evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. The new standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2016. Early adoption is permitted. We are currently evaluating the impact of this guidance.

        In February 2015, the FASB issued ASU 2015-02, "Consolidation (Topic 810)—Amendments to the Consolidation Analysis." The amendments in Topic 810 respond to stakeholders' concerns about the current accounting for consolidation of variable interest entities, by changing aspects of the analysis that a reporting entity must perform to determine whether it should consolidate such entities. Under the amendments, all reporting entities are within the scope of Subtopic 810-10, Consolidation—Overall, including limited partnerships and similar legal entities, unless a scope exception applies. The amendments are intended to be an improvement to current U.S. GAAP, as they simplify the codification of FASB Statement No. 167, Amendments to FASB Interpretation No. 46(R), with changes including reducing the number of consolidation models through the elimination of the indefinite deferral of Statement 167 and placing more emphasis on risk of loss when determining a controlling financial interest. The amendments are effective for publicly-traded companies for fiscal years beginning after December 15, 2015, and for interim periods within those fiscal years. Earlier adoption is permitted. We do not expect this guidance to have a material effect on our consolidated financial statements at the time of adoption of this standard.

        In November 2015, the FASB issued ASU No. 2015-17, "Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes". The new guidance requires entities to present all deferred tax assets and liabilities, along with any related valuation allowance, as non-current on the balance sheet. The guidance is effective for publicly-traded companies for interim and annual periods beginning after December 15, 2016 (early adoption is permitted). We are currently evaluating the impact of this guidance.

        In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)." The new guidance requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease

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liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Public business entities should apply the amendments in ASU No. 2016-02 for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years (i.e., January 1, 2019, for a calendar year entity). Early application is permitted for all public business entities and all nonpublic business entities upon issuance. We are currently evaluating the impact of this guidance.

        In March 2016, the FASB issued ASU No. 2016-09, "Improvements to Employee Share-Based Payment Accounting (Topic 718)." The new update will require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also will allow an employer to repurchase more of an employee's shares than it can today for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. The guidance is effective for us on January 1, 2017. Early application is permitted in any annual or interim period for which financial statements haven't been issued or made available for issuance, but all of the guidance must be adopted in the same period. We are currently evaluating the impact of this guidance.

        In April and May 2016, the FASB issued ASU No. 2016-10, "Identifying Performance Obligations and Licensing (Topic 606)" and ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients". Both of the amendments in these updates do not change the core principle of the guidance in Topic 606. The new update in ASU No. 2016-10 clarifies the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. The new update in ASU No. 2016-12 affect only the narrow aspects of Topic 606, such as Assessing the Collectibility Criterion in Paragraph 606-10-25-1(e) and Accounting for Contracts That Do Not Meet the Criteria for Step 1 (Applying Paragraph 606-10-25-7), Presentation of Sales Taxes and Other Similar Taxes Collected from Customers, Contract Modifications at Transition and Contract Modifications at Transition. The effective date and transition requirements for the amendments in these updates are the same as the effective date and transition requirements for Topic 606 (and any other topic amended by ASU No. 2014-09). We are currently evaluating the impact of this guidance.

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BUSINESS

Overview

        Gridsum is a leading provider of sophisticated data analysis software for multinational and domestic enterprises and government agencies in China. Our proprietary distributed data architecture allows our customers to efficiently collect and analyze vast amounts of information that is collected, indexed and stored in an organized manner, or structured data, and information that is not organized, or unstructured data. Our core technology, the Gridsum Big Data Platform, with its machine learning capability, performs multi-dimensional correlation analysis and analyzes complex real-time events. With the support of our Big Data Platform, our customers use our data visualization and data-mining technologies to identify complex relationships within their data and gain new insights that help them make better business decisions.

        Our leading position is based on our solutions and our core technologies. Our software products are designed for a variety of commercial and governmental applications. To help our enterprise customers reach China's large and growing online and mobile population, our initial products have focused on digital marketing analytics and automation solutions. We were among the first companies to offer web analytics solutions based on data warehouse technology, and we were among the first digital intelligence companies in China to build solutions entirely on a distributed data warehouse architecture using the open-source Hadoop framework. In addition, we believe we are the only China-based company to provide solutions to enterprise customers that cover web, video and mobile analytics. Our solutions analyze data from approximately 61 million internet and mobile sessions per day from users operating on over 233 million desktop and mobile devices. By leveraging the analytic capabilities of our Big Data Platform, we have developed additional software solutions, including new media analytics and information discovery solutions, to address a broad range of customer needs. In 2015, our customers included Fortune 500 and China 500 enterprises, comprising more than 300 customers across diverse industries, including over 30 Chinese government agencies.

        We have grown rapidly in recent periods, with net revenues in 2013, 2014 and 2015 of RMB62.5 million, RMB124.5 million and RMB234.8 million (US$35.3 million), respectively, representing year-over-year growth of 99% and 89%, respectively, and net revenues in the six months ended June 30, 2015 and 2016 of RMB84.6 million and RMB148.1 million (US$22.3 million), respectively, representing period-over-period growth of 75%. We have continued to make expenditures and investments, including in our technologies, personnel, sales and marketing, infrastructure and operations, and incurred net losses of RMB30.7 million, RMB37.3 million, RMB48.8 million (US$7.3 million) and RMB29.7 million (US$4.5 million) in 2013, 2014, 2015 and the six months ended June 30, 2016, respectively. Our customers increased in number from 141 in 2013 to 211 in 2014 and 307 in 2015, and over the same period, our average customer contribution increased 33% and 30% year over year. We enjoy high customer loyalty and revenue retention, with 168%, 116% and 138% revenue retention rates in 2013, 2014 and 2015, respectively. We calculate average customer contribution by dividing total net revenues in a period by total number of customers in the same period. Our revenue retention rate consists of aggregate net revenues from all customers in the prior period that remain customers in the current period, divided by total net revenues from all customers in that prior period.

Industry Background

        China has the world's largest population of internet users. According to a report that we commissioned from Forrester Consulting, a third-party research organization, which we refer to as the Forrester report, China's online population was already 717 million in 2015 and is projected to grow to 788 million by 2017. In addition, according to China Internet Network Information Center, 90.1% of China's internet users used their mobile devices to access internet services and applications as of December 2015. This rapid growth of internet users and proliferation of mobile-connected devices,

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together with rapidly evolving trends in mobile and internet commerce, has led to rapid growth in the volume and complexity of digital data. According to an April 2014 report by EMC Corporation based on International Data Corporation analysis, the volume of data created, replicated and consumed in China is estimated to grow from 909 exabytes in 2014 to 8,060 exabytes by 2020, representing a CAGR of 43.9%. Over that time, China's share of global data volume is expected to grow from 13% to 18%.

Enterprise IT Environment

        According to the Forrester report, total IT spending by government agencies and businesses in China amounted to an estimated US$133 billion in 2015. An increasing number of multinational and domestic enterprises in China are investing in the technology and personnel needed to make effective use of the massive volume of digital data. The ability to capture, manage and analyze customer and organizational data has become a key requirement of effective enterprise management. The emerging enterprise IT environment powers the measurement, optimization and execution of digital customer interactions and internal business operations.

The Increasing Significance of Domestic Software in China

        According to the Forrester report, software spending in China is estimated to be US$17.8 billion in 2015 and is expected to grow to US$22.6 billion in 2018. The Chinese government has introduced favorable policies to foster the growth of China's domestic software industry including a 10-year "Made in China 2025" initiative with the objective of developing homegrown world-class system software, cloud computing infrastructure and big data applications. Data security concerns make it challenging for multinational software vendors to compete in sensitive industries, creating a favorable environment for China's domestic vendors to serve customers in those industries.

The Emerging Digital Intelligence Market in China

        Advances in digital technologies such as enterprise mobility and interactive social platforms are driving the innovation of new business models and service offerings. In order to effectively win, serve and retain customers by leveraging this changing digital environment, organizations in China are increasing their spending on business technologies and services, particularly software. Examples include investments in customer content management and delivery, marketing campaign software, development frameworks and platforms for customer applications, and other evolving technologies designed to deliver superior digital customer experience. The Forrester report forecasts that software spending on business technologies and services in China will reach US$8.6 billion by 2018, up from an estimated US$6.2 billion in 2015.

        Digital intelligence is the portion of the business technologies and services market that Forrester defines as the capture, management and analysis of data to provide a holistic view of the digital customer experience and optimize online customer engagement. This market is under-penetrated in China. Implementation of digital intelligence solutions in China is driven by the need to create a personalized digital experience for customers, increase efficiency and save costs, and optimize customer engagement. According to the Forrester report, the digital intelligence market has an estimated size of US$422 million in 2015, which is only 6.8% of business technologies and services spending and 2.4% of total software spending in China. The digital intelligence market is expected to grow faster than the overall business technologies and services market, and is expected to account for an increasingly larger share of business technology software spending.

Emergence of Big Data Technologies for Structured and Unstructured Data

        Historically, companies have used on-premise database technologies from vendors such as Oracle, IBM and Microsoft to house their business data. Implementing these databases requires significant

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capital expenditure on IT hardware and IT services, followed by significant ongoing software licensing costs. In addition, these legacy technologies require data be collected and indexed, then stored in a highly structured database format of rows or columns which can only be accessed using customized queries that are programmed to generate reports. This is useful for generating periodic reports under enterprise resource planning or customer relationship management applications that are relatively static, but is not effective at analyzing data and events in real-time, or data that do not fit in structured rows and columns. According to Gartner, unstructured data represents as much as 80% of an organization's data assets, such as web pages, images, blocks of text and machinery logs. This data is not easily analyzed using traditional database architectures. Over the past few years, a wide variety of technologies have been introduced to greatly increase the ability to collect and analyze the rapidly growing variety, velocity and volume of data. These technologies and their impact on expanding the ability to collect and analyze data are commonly referred to as big data.

Challenges of Leveraging Big Data in China

        While enterprises increasingly recognize the utility of leveraging the rapid proliferation of data to make business decisions, they face many challenges in attempting to analyze the large volume of relevant data.

Difficulty in Analyzing Unstructured Data—Unstructured data represents the vast majority of all data created, which is particularly difficult for traditional data analysis solutions to handle.

Lack of Sophisticated Data Correlation Analytics—We believe most existing data analysis solutions lack the ability to correlate large volumes of data, particularly when it is generated over time on different types of devices and formats.

Inability to Analyze Data and Events in Real Time—We believe many technologies are unable to track data about events as they occur and analyze rapidly growing volumes of structured and unstructured data in real time.

Difficult to Use—Existing solutions that offer a poor user experience because they require extensive training and often specialized expertise, are of limited use for most business organizations.

Ineffective Reporting Tools—We believe many solutions lack effective mechanisms for users to generate reports that are relevant for business decision makers, limiting the business utility of these solutions.

Lack of Integration with Multiple Systems—The poor integration of data analysis tools with other enterprise information systems has been one of the top inhibitors for Chinese enterprises attempting to execute digital analytics strategies.

Inadequate Localization—Software solutions provided by foreign vendors are not optimized for analysis of Chinese language data and are not easily customized to meet the specific needs of enterprises in China.

Key Advantages of our Solutions

        We deliver our solutions as cloud-based software-as-a-service, or SaaS, offerings that are easy to deploy, easy to access, automatically updated without disruption, and enable our customers to reduce IT support costs by outsourcing hardware and software maintenance and support. The key advantages of our solutions include:

Fast and Efficient Multi-dimensional Drill-down—Our software is designed to enable customers to derive valuable intelligence from both structured and unstructured data quickly and easily. Our proprietary technology leverages our high performance correlation analysis engine to provide real-time response to customer data queries. Customers perform multi-dimensional data drill-down and

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correlation analysis with simple point-and-click and fingertip gestures, thereby identifying issues and isolating causes.

Simple and Customizable Visualization—We design our visualization to be simple, intuitive and user-friendly. Users learn and begin using our products with little to no training required. Our dashboards are optimized for multiple industry verticals, and within each industry the visualization can easily be customized based on specific customer needs. This ease of use allows users with little technical training or IT support to leverage our products and achieve desired results for their work.

Fully Integrated Solution Suites—All of the individual solutions in our solution suites share a common user interface, through which customers access the solutions they have purchased. Our solutions are accessible across all screen formats, from large multi-screen control centers to desktops and mobile devices.

Easy and Rapid Deployment—Our solutions can typically be deployed and configured by our customers within a day, without specialized training, and readily integrate with customers' management and operating systems. Easy implementation and reduced start-up time allow customers to gain proficiency in our software quickly and to see results immediately. Updates such as software enhancements and new features can be delivered from the cloud without disruption to customers' daily operation. Our highly flexible and extensible architecture delivers scalable and adjustable solutions for customers and allows us to offer specific solutions for specific customer needs. Customer dashboards are readily customizable based on customer needs, with no special coding or reconfiguration required.

Lower Total Cost of Ownership—Our cloud-based solutions enable our customers to access our software solutions anywhere, anytime and in real time, and reduce upfront investment and total cost of ownership because our customers do not need to invest in additional hardware or IT infrastructure to utilize our products.

Made in China, for China—Our solutions are designed with the China market in mind and are readily customizable or adaptable to address specific needs of domestic enterprise customers. Our natural language processing capabilities are designed to handle unstructured data in the Chinese language.

Our Core Technology

        We offer suites of solutions that are built on our core technology. These end-to-end solution suites address customer needs in marketing automation, e-Government, new media, information discovery and visualization. Our solutions and core technologies are built on our distributed data warehouse architecture using the open-source Hadoop framework. Our data architecture offers high scalability and high performance characteristics. Our core technology consists of our data visualization and interactive

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data mining technologies, the Gridsum Big Data Platform and our data acquisition and data pre-processing technologies.

Gridsum Big Data Platform

        Our software solutions are built on the Gridsum Big Data Platform, our proprietary technology designed to acquire, store, process and analyze large and rapidly growing volumes of both structured and unstructured data, leveraging our highly scalable correlation analysis engine and complex event processing capability. A distributed computing architecture is required in order to analyze in real time the rapidly growing volume and complexity of digital data. We were among the first digital intelligence companies in China to build solutions entirely on a distributed data warehouse architecture using the open-source Hadoop framework, allowing us to perform multi-dimensional correlation analysis in real time, on data sets regardless of size, and to implement real-time interactive data mining at large scale.

        The core capabilities of the Gridsum Big Data Platform include:

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Multi-dimensional correlation analysis—Our correlation analysis engine enables us to dynamically correlate large quantities of structured and unstructured data on an unlimited number of dimensions. This high performance capability, enabled by our large-scale distributed data warehouse architecture, allows us to run multi-dimensional data drill down and data correlation analysis in real time, on datasets regardless of size. We perform this analysis on all of the data in the dataset, without resorting to sampling. Our correlation analysis capability is further enhanced by the size and quality of our datasets, including data acquired from consenting customers and third parties, public information that we have collected from web crawling and data derived from these datasets. Our data includes the correlations that we have retained from our past projects. Because we have been accumulating our datasets since 2009, with a focus on data closely related to our customers' business operations and customer interactions, we believe that our data assets are among China's largest and highest quality.

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Machine learning capability empowered by highly relevant large-scale historical data assets and industry experience—Our machine-learning algorithms learn from experience, identify patterns of interest and make data-driven predictions within their defined parameters. We leverage our data assets and industry expertise to design machine-learning algorithms that solve specific industry problems for our customers. In conjunction with our natural language processing technology,

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machine learning is particularly suitable for processing unstructured data by recognizing patterns and connections through which the raw data can be structured and analyzed.

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Natural language processing technologies—Natural language processing, or NLP, for the Chinese market is extremely complex due to fundamental characteristics of the Chinese language, including multiple meanings of the same Chinese characters, contextual association of characters into words and lack of punctuation. We have solved these long-standing problems by developing proprietary NLP technologies based on algorithms and machine learning techniques that are designed to understand and analyze the complexity of the Chinese language and its usage in various contexts. Our NLP technologies enable the extraction of information about entities, correlations, sentiments and emotions from vast amounts and variety of digitized documents, text converted from audio and video streams and other digital content in targeted industries such as legal and media. With our NLP technologies, we are able to extract structure from unstructured data, so that it can be processed and analyzed effectively.

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Real-time complex event processing—Our complex event processing technology tracks all available data about events as they occur and applies sophisticated rules to identify patterns that signify problems, threats and opportunities for our customers. This technology is well suited for analysis of large-scale concurrent streaming data in real time.

        All of these capabilities of the Gridsum Big Data Platform are easily extensible and are highly scalable, allowing us to enter into new industries and serve new customers.

Visualization Technologies

        We offer intuitive interactive visualization tools and dashboards that allow customers to display vital performance metrics in a highly flexible and customizable way and allow users to interact directly with data by using simple fingertip and point-and-click gestures to perform analyses and answer questions. Our visualization capabilities support a full range of formats, from live data displays on large multi-screen control centers, to reports optimized for mobile devices. Our visualization tools and dashboards are designed to be a rich interface that supports interactive data mining and integrates across device formats. Visualization is an important component of our technology used in all of our solutions and is highly adaptable to the requirements of different industries and individual customers.

Data Acquisition Technologies

        Time-stamping is a universal characteristic of all machine generated and reported data. Our technology gives us the ability to apply an analytical framework to any raw data that is time stamped, whether the data is sourced from a single click on a website or from complex natural language documents. This capability allows us to organize data and cross correlate it and to perform sequence analysis to determine causality of events. We collect and process massive volumes of time-stamped data at high speed using our proprietary Extract, Transform and Load, or ETL, technologies. Our ETL technologies enable us to apply relevant analytical frameworks to raw data in various forms and give us the high performance required to analyze rapidly growing volumes of structured and unstructured data in real time, extracting intelligence critical to our customers.

Our Competitive Strengths

        Our mission is to help enterprises and government organizations in China use data in new and powerful ways to make better informed decisions and be more productive. The competitive strengths that we believe enable us to achieve our mission include:

Digital Intelligence Pioneer—As an early mover in China's emerging digital intelligence industry, we have significant competitive advantages in the market. We pioneered the development of our

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distributed data warehouse architecture and core technology, on which all of our solutions are built. Technology that applies to our Web Dissector solution is equally applicable to our Mobile Dissector solution. Moreover, as we have delivered services to customers in different industries, we have gained deep industry expertise in those sectors, which is built into the unique capabilities and functionality in our products. This industry expertise differentiates our products and enables us to provide in-depth services to our customers. Since our inception, we have been among the most prolific developers of data analytics technology in China, having applied for over 1,000 software patents in China and internationally. In 2014, Gridsum was named one of the Top 10 companies in Beijing's high tech Zhongguancun research district in terms of the number of patents filed, according to statistics published by the State Intellectual Property Office and Zhongguancun Administrative Committee.

Powerful Cumulative Data Assets—Over our history, a broad range of customers have used our solutions to analyze increasing volumes of data. The scale of data accessible in our database allows our proprietary software to discover unique data patterns and capture new correlations which enhance the capabilities of our software. Our accumulated data and correlation analyzes create a self-reinforcing virtuous cycle in which our data analytics capabilities attract more customers, and more customers in turn further enhance our digital intelligence capabilities. Our solutions analyze data from approximately 61 million internet and mobile sessions with commercial intent per day from consumers operating on over 233 million desktop and mobile devices. A "session" is a measure of interaction or communication between an online or mobile user and a server, in which information of any sort is exchanged for some period of time. Because we have been accumulating this data since 2009, with a focus on data related to customers' business operations and end user interactions, we believe that our data sets are among China's largest and highest quality. Our unique access to large scale, high quality data allows us to deliver highly differentiated data technology solutions and provide valuable real-time business insights to customers.

Diversified Customer Base—Our proprietary digital intelligence solutions allow us to address demand from customers across a broad range of industries. Our customers include multinational companies and other leading enterprises in a wide range of industries. We also serve a large number of public sector customers in the PRC. As customers' business decision making processes become more complex, we continuously enhance our data analytic functionalities to address specific requirements in different industries. In 2014, we launched our comprehensive ADSUITE of marketing automation products. In addition, we offer solutions for public agencies, new media and information discovery. The strength of our products and extensibility of our solutions provide strong potential for us to cross sell additional solutions and to expand our market share.

High Customer Loyalty and Revenue Retention—Customers have demonstrated strong reliance on our digital intelligence solutions to make important business decisions. We had a revenue retention ratio of 168% in 2013, 116% in 2014 and 138% in 2015, demonstrating our ability to grow revenues from existing customers. The critical nature of the data analysis functions that our products perform makes our software a vital component of customer operations. The value proposition of our advanced digital intelligence technologies has encouraged customers to expand their use of our products over time.

Scalable Business Model—Our data analysis solutions are highly adaptable, significantly lowering our costs of product design and system deployment. Because our solutions are designed for large enterprises and delivered through the cloud, they are easily scalable to meet customer demand. In addition, our software is designed to address a broad range of business requirements for customers in many different industries. As a result, we are able to deploy our solutions to new customers at minimal incremental cost. This allows us to swiftly establish a business presence in new industries and efficiently expand our client base.

Experienced and Visionary Management Team—Our success is attributable to the deep industry experience and proven execution track-record of our experienced management team. Our company was

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founded in 2005 by a team of five visionary Tsinghua University computer software undergraduate students, led by our chief executive officer and chairman, Guosheng Qi. We named our company "Gridsum" to symbolize the combination of distributed computing (Grid) and analytics (sum). We were among the first participants in the industry to foresee the significant demand for advanced data analysis solutions in China. Since our inception, we have anticipated and successfully developed digital intelligence solutions to address customer requirements across different industries. We subsequently complemented our management team by adding key senior management members, with experience in leading technology companies including Microsoft, Baidu and Neusoft. We believe our management team's collective experience and strong execution capabilities are unrivalled in the digital intelligence industry.

Our Growth Strategy

        In order to grow our business and to fulfill our mission, we have implemented a number of key strategies.

Continue to Innovate—Our proprietary technology is our core competitive strength, and we intend to continue to invest in the development of advanced technologies and remain at the forefront of the digital intelligence industry. We are committed to continuously enhancing the Gridsum Big Data Platform, our visualization and interactive data mining technologies and our data acquisition and pre-processing technologies, as well as developing new technologies. To support our technological development, we will continue to build our research and product development team and foster our corporate culture of innovation to retain and attract top engineering talent in China.

Increase Market Penetration—We intend to leverage our domain knowledge, product expertise and proven customer track-record to increase market penetration for our existing technologies. For example, we intend to leverage our NLP technologies to develop industry solutions and capture market opportunities in information discovery for media, legal and financial information services.

Grow our Customer Base—Our current customer base represents a small fraction of our total addressable market in China. We plan to expand our sales and marketing force to continue to acquire new customers. We will expand and deepen our customer relationships to address data intelligence opportunities in various sectors such as autos, consumer products, e-commerce, electronics, financial services, new media and travel. We plan to target any organization with an online presence, or with large scale data processing requirements. In addition, we will continue to build and enhance our brand awareness to assist our expansion into new markets and verticals.

Expand our Share of Customer IT and Marketing Budgets—We intend to continue to focus on large enterprise and government agency accounts to grow our business and to maintain customer loyalty based on our strong commitment to the needs of customers and high customer satisfaction. We continue to work with customers to expand their usage of our existing products and strive to enhance our service quality to strengthen customer loyalty and revenue retention. In addition, we intend to broaden our dialogue with our customers to include senior executives such as chief marketing officers, chief information officers and chief technology officers, so that we can capture marketing budgets as well as broader enterprise IT budgets. We believe that this strategy will provide increasing opportunities to cross sell our solutions.

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Our Solutions

        We offer suites of solutions for marketing automation, e-Government, new media, information discovery and visualization. Customers using our solutions are able to:

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analyze user behavior online and on mobile devices;

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assess web design and conduct A/B testing of web and mobile web design;

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manage massive scale search engine marketing campaigns;

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measure the contribution of different marketing channels to user conversion;

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monitor and analyze streaming media and optimize user experience;

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correlate information in unstructured datasets using natural language processing;

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integrate data from diverse data sources online and offline; and

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visualize and interact with graphical information across multiple display sizes and formats.

        We deliver our solutions as cloud-based SaaS offerings designed for ease of use and rapid adoption within the customer's organization.

Marketing Automation Suite

        All of our marketing automation solutions are available as an integrated suite of solutions, which we call ADSUITE. The capabilities of each solution are described below.

Web Dissector is used to analyze customer websites by monitoring and analyzing key performance indicators such as clicks, page views, sessions, conversion rates and sales. Web Dissector precisely measures the effectiveness of online promotional activities and detects click fraud. The capabilities and features of Web Dissector include:

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online operational data analysis;

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pixel-level interactive click and touch "heat maps";

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multi-dimension drill-down analysis;

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click fraud detection;

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online asset assessment;

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user behavior analysis;

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online performance optimization; and

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online advertisement delivery and performance analysis.

Mobile Dissector is used to understand mobile app user activity, gain insight into users' interactive behavior, and improve user experience with the application and retention rate. Mobile Dissector also helps advertisers monitor characteristics of mobile audiences on mobile web sites and apps, user behavior and the value of different mobile channels. The capabilities and features of Mobile Dissector include:

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mobile application promotion and distribution analysis;

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mobile apps data analysis;

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error and exception tracking;

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custom event analysis;

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multi-dimensional drill-down analysis;

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app life-cycle analysis; and

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cross platform analysis.

SEM Dissector automates search engine marketing processes for advertisers, advertising agencies and advertising account managers, and provides comprehensive, objective and transparent performance reports. SEM Dissector supports simultaneous management of multiple accounts and grouping of customized keywords with major Chinese search engines, including Baidu, Sogou and Qihoo 360. Built-in analytical models guide customers to optimize keyword advertising, and automatic bidding algorithms monitor competitors' advertising activities and make appropriate bids automatically. The capabilities and features of SEM Dissector include:

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customer data integration and key performance indicator customization;

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keyword advertising management;

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report customization;

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automatic advertising placement and bid management; and

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attribution model.

SEO Dissector is our search engine optimization tool. It analyzes website quality and the website's level of accessibility to various search engines. Customers use SEO Dissector to evaluate website performance, identify defects and make improvements. Customers also evaluate reports of keyword search results on different search engines, enabling them to optimize their websites to improve their organic rankings on search engine results pages. The capabilities and features of SEO Dissector include:

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website indexability analysis;

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multi-dimensional analysis of keywords ranking;

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rich and intuitive presentation of analysis results;

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practical webmaster tools; and

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flexible customization.

Ad Dissector is our advertisement performance monitoring and optimization product. It monitors and analyzes banner, rich media and text link and other advertising formats and leverages our core technology to provide optimization solutions. Advertisers and advertising agencies use Ad Dissector to measure performance of online advertising and allocate media resources to improve returns. The capabilities and features of Ad Dissector include:

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user-friendly placement management;

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convenient landing page and scheduling management;

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real-time data tracking;

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powerful multi-source data correlation analysis; and

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Gantt chart performance visualization.

Contribution Dissector tracks and analyzes user behavior over the entire user life cycle from original access to ultimate conversion, tracing that behavior over years and various conversion data points and applying various attribution model algorithms to the data. Customers assess advertisement results across media outlets, connect off-line conversion, analyze contribution from each channel to the ultimate conversion process and optimize online businesses. Website operators use Contribution Dissector to evaluate the performance of their advertising campaigns across media outlets, connect offline conversion, analyze historical channel contributions to the ultimate conversion or sale and allocate their advertising resources efficiently based on the results. The capabilities and features of Contribution Dissector include:

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conversion path identification;

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integration of online and offline data;

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multiple attribution models;

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multi-dimensional analysis;

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marketing channel analysis; and

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user behavior playback.

Audience Dissector is our audience analysis product. It combines customer offline user data from customer relationship management systems with our online user behavior data and digital intelligence capabilities to identify high value and high loyalty users and improve customer returns on their marketing investments. The capabilities and features of Audience Dissector include:

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intelligent customer relationship maintenance system;

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decision-making support and optimization;

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flexible user behavior tagging management;

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flexible application programming interface; and

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data security and privacy.

Recommendation Engine is our data driven content recommendation solution for customers delivering adaptive video, news and e-commerce content on websites, mobile apps and Internet protocol television terminals. By accumulating user behavior data, Recommendation Engine

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continuously captures user preferences and improves the accuracy of its recommendations. The capabilities and features of Recommendation Engine include:

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mainstream mobile operating system data collection and analysis;

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optimization for industry verticals;

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personalized recommendations for mobile application content; and

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powerful content management platform.

E-Government Suite

Government Web Dissector is our digital intelligence solution for public sector websites, providing government website operators at local, municipal, provincial and national levels with real-time website operating data and digital intelligence that is similar to what is provided to commercial customers by our Web Dissector solution. Our public sector customers use Government Web Dissector to optimize the quality and efficiency of online public services, such as driver's license applications and marriage certificate applications. In addition to the features available from the standard Web Dissector, the capabilities and features of Government Web Dissector include:

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public service performance metrics; and

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intelligent diagnostics across websites.

Government Website Group Integrated Management Platform, which we refer to as the Integrated Management Platform, is our integrated big data visualization system used by government website operators that are responsible for managing groups of websites. It provides a visualized integrated display of website group operating status and data. The capabilities and features of the Integrated Management Platform include:

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comprehensive overview of website groups;

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performance overview;

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visual comparison;

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website correlation display; and

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geographic distribution visualization.

New Media Suite

Streaming Dissector is our real-time viewership analysis and operational efficiency monitor for digital online video. Unlike traditional methods of measuring viewership, Streaming Dissector does not rely on viewer sampling, but continually monitors all viewers of the streaming video. The capabilities and features of Streaming Dissector include:

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real-time streaming monitoring;

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content delivery network monitoring;

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reporting and alerting;

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real-time rating analysis; and

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multi-platform support.

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Video Dissector is our online video content analytics tool for discovering the most valuable or attractive parts in video content. It provides analysis of viewer behavior and solutions for optimizing online video content. The capabilities and features of Video Dissector include:

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online video operation analysis;

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video content evaluation;

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viewer analysis; and

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online video performance analysis.

TV Dissector is our analytics tool for internet protocol television, internet television, cable television, satellite television and digital television. It monitors and analyzes viewer behavior and provides solutions to optimize the business and operations of TV station operators. TV station operators use TV Dissector to analyze the development and activity of users and viewership of live broadcast, play on-demand and playbacks, generate accurate statistics about the conversion of their electronic program guide pages and advertising activities and optimize product packages and pay-per-view businesses. The capabilities and features of TV Dissector include:

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user development and activeness analysis;

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viewership analysis;

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play on-demand and playback analysis;

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product package analysis;

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electronic program guide analysis; and

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user experience analysis.

Rating Plus is our television viewing data analytics tool for traditional TV stations. Rating Plus automatically combines traditional viewership log data with the channels and programs of the TV stations and generates viewership analysis. The management and operation personnel of the TV stations easily access the analysis via computers and mobile phones. Rating Plus provides search functionality that supports complex multi-dimension data searches and alerting feature that provides monitoring and malfunction alerting related to program broadcasts. The capabilities and features of Rating Plus include:

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automatic generation of viewership data;

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viewership analysis; and

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program analysis.

Information Discovery Suite

Media Dissector is our mass media, social media and user-generated content media monitoring and analytics tool. Media Dissector applies distributed cloud computing crawler technology to capture media information on the internet. It uses natural language processing technology such as word segmentation, named-entity recognition and Chinese information processing technology to process information and provides correlation analysis to enable drill downs for information discovery. The capabilities and features of Media Dissector include:

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information overview;

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item mentions and context analysis;

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media event and public opinion analysis; and

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sentiment analysis.

Law Dissector and Smart Push. Law Dissector is our search and statistical analysis tool for legal research. It utilizes our natural language processing technology and applies data science methodology in the legal industry. Law Dissector summarizes the key attributes of legal cases and aggregates them for statistical analysis, which enables judges, lawyers and researchers to find implied patterns or rules that would be valuable for their respective professional objectives. Smart Push is our recently developed legal research tool that recommends relevant cases and legal information based on keyword search or natural language search. The capabilities and features of Law Dissector and Smart Push include:

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information retrieval;

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powerful aggregation and statistical research;

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intelligent case analysis; and

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recommendation of relevant judicial precedents and legal information.

Information Dissector is an insightful analytical system developed to provide stock price predictions based on market sentiment in Chinese equity markets. Information Dissector gathers information from many sources, such as news, blogs, forums and analyst reports, maps each piece of information to particular industries and companies and processes the information into specific metrics used as input for complex time-series models and algorithms. The capabilities and features of Information Dissector include:

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market sentiment analysis;

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multiple metric measurement; and

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intuitive visualization interface.

Visualization Suite

Gridsum Dashboard is our data visualization tool for our digital intelligence solutions. It is used for interactive data mining and visualized data analysis. Gridsum Dashboard integrates charts, graphics and tables from various data sources and displays them on a single multi-screen interface. It offers pre-configured data visualization templates and provides customers with options to customize their data displays. Gridsum Dashboard improves visualization of customer digital intelligence data, so that customers understand the business operations in a timely and intuitive manner and provides business intelligence support for decision-makers. The capabilities and features of Gridsum Dashboard include:

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real-time connection to data;

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visualization templates;

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access control; and

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user-friendly interface.

Gridsum Report Center is our automated report generation and distribution tool, which supports data reporting for all of our solutions, aggregates data from multiple dimensions, customizes and creates report templates and configures report distribution. The data integrity verification capability makes report preparation convenient and improves the visual quality and accuracy of reports. The capabilities and features of Gridsum Report Center include:

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seamless integration;

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data integrity verification;

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multiple methods for report distribution;

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reusable report templates; and

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customizable and data combination from multiple dimensions.

Our Customers

        In 2015, we had over 300 customers. A single customer may have multiple paid business accounts for separate divisions, segments or subsidiaries, but we count all entities that are part of the same corporate structure as a single customer. The following is a list of representative enterprise customers, arranged by industry segment.

Travel & Hotels	Financial	Internet & e-Commerce
CAR Inc. 7 Days Inn HomeInns InterContinental Hotels Group	Agricultural Bank of China Bank of China PICC	JD.com Tencent

New Media Operators	Consumer Products	Automotive
CCTV China Network Television Hunan Television Jiangsu Broadcasting   Corporation Shanghai Media Group	Coca-Cola L'Oréal Nike Wyeth	Chrysler Dongfeng Nissan Maserati PSA Peugeot Citroën Group Shanghai Volkswagen

Electronics & Appliances

Daikin
Dell
Haier

        In addition, we offer our e-Government solutions to Chinese government agencies to analyze public sector websites and improve the effectiveness of online services for Chinese citizens. In 2015, more than 30 Chinese governmental agencies had deployed our products.

        We receive revenues from the incentive programs of search engine providers, such as Baidu, Qihoo 360 and Sogou. The amount of revenues we receive under these programs is based on factors determined by the search engine providers, including yearly growth in the amount of advertising on the provider's search engine platform that our customers purchase through our solutions, the number of new customers utilizing our solutions to access the search engine platform, and other factors selected at the discretion of the search engine providers. Search engine providers compete for search-based advertising customers and administer their own assessment policies, including documentation, payment and media certification, that are designed to ensure customer satisfaction. Customers that manage ad placement bidding and spending on search engine platforms may generate revenue for us under the search engine provider incentive programs. We receive revenues from these programs on a quarterly basis. Revenues from the Baidu incentive program accounted for 18% of our revenues in 2013 and for less than 10% of our revenues in 2014, 2015 and the six months ended June 30, 2016.

Customer Use Cases

Haier Group—Understanding User Demand and Behavior with Web Dissector

        Haier Group is a leading consumer electronics and home appliances company committed to providing the "wonderful lifestyle" to consumers worldwide. In December 2012, Haier announced the

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commencement of its fifth development phase since its inception in 1984, which is the "internet phase." Understanding user demand and behavior for online shopping is a key building block for Haier to implement its internet strategy. With the installation of Web Dissector for desktop and mobile internet, Haier was able to accurately monitor and analyze its website traffic, promotion activities and individual consumer's online behavior. This provided critical support for Haier's marketing automation operations, improved user experience, and helped Haier to achieve its internet strategy.

Coca-Cola—Gaining App Marketing Insights with Mobile Dissector

        Coca-Cola, a global beverage supplier, used Mobile Dissector to evaluate its mobile app marketing campaign and optimize the marketing strategy. Mobile Dissector monitored app downloads in various app stores and offline channels and assessed the results by channel. Mobile Dissector also analyzed user in-app behavior to identify frequently used functions, common visitor paths and error and exception messages, in order to provide more effective support for optimization of the app and better user experience.

Chrysler (China)—Connecting Online and Offline Data with ADSUITE

        Chrysler (China), the China joint venture of a global automobile manufacturer, used multiple solutions in our ADSUITE, including Web Dissector, Ad Dissector and Contribution Dissector, to support its marketing and sales programs. Chrysler connected and integrated online and offline customer data, including display ad impression data, website visits, online sales leads and dealer sales data, in order to better assess ad results and guide Chrysler's marketing decisions.

Nike—Optimizing Search Engine Marketing with SEM Dissector

        Nike, a global sportswear supplier, used SEM Dissector to manage its search engine keyword campaigns for its own website and third-party e-commerce platforms. SEM Dissector associated online users' search behaviors with their purchase behaviors, highlighting paths that customers took from search to purchase. SEM Dissector allowed Nike to dynamically aggregate and reorganize search results data for its large and frequently updated product inventory using virtual category reporting within SEM Dissector, rather than requiring changes to its campaigns through search engine providers. As a result, Nike improved its return on investment in paid search channels. In connection with the services we provided to Nike, we received revenues based on the amount of search-based advertising purchased by Nike. See "—Our Customers."

Shanghai Volkswagen—Managing Ad Performance for Large Network of Dealers with Ad Dissector

        Shanghai Volkswagen, the China joint venture of a large automobile manufacturer, used Ad Dissector to customize a system to track the performance of online and offline media campaigns by its leading network of regional dealers. Ad Dissector used media spending data to quantitatively assess the performance of those campaigns and to calculate a standard per dealer advertising budget. This enabled Shanghai Volkswagen to provide specific dealer campaign feedback to improve their campaigns and to implement an optimized advertising strategy across the network.

Homeinns Hotel Group—Tracing Customers' Online Paths to the Hotel with Contribution Dissector

        Founded in 2002, Homeinns Hotel Group is the leading economy hotel chain in China in terms of market share, number of hotels and hotel rooms and brand recognition. Homeinns Hotel Group uses digital medial channels in addition to traditional media in order to grow its market share. To assess the effectiveness of its various digital advertising channels, Homeinns utilized the attribution model in Contribution Dissector to analyze long-term customer behavior and the combination and sequence of events across digital channels that correlated with hotel choice. This enabled Homeinns to allocate its

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advertising budget across digital marketing channels more effectively, capture more potential customers and increase customer loyalty.

The People's Government of Hainan Province—Responding to Public Concerns with Data Support

        The People's Government of Hainan Province used our e-Government solutions to provide valuable and timely information on issues of public concern. For example, through classification and analysis of internet search keywords, the Hainan provincial government identified noticeable changes in public demand for government information during different phases of a typhoon before and after landing, and developed a system to direct information queries to the appropriate government agencies based on their respective responsibilities. As a result, the Hainan provincial government was able to build an inter-departmental information system during typhoon season, which greatly enhanced the efficiency of its emergency management function.

CNTV—Optimizing Viewer Experience with Streaming Dissector

        CNTV, a national internet TV broadcasting entity, used Streaming Dissector to monitor video player performance in real-time. Video performance was measured in terms of video availability, initial loading time, number and duration of pauses and other performance indicators at the user end. Streaming Dissector successfully monitored the viewing experience for all end users in real time and provided operational optimization support for CNTV's live online broadcasting of the women's volleyball gold medal match in the 2016 Summer Olympics with concurrent viewer of over five million accessing the stream from CNTV's website and mobile apps. During the 2016 Summer Olympics, CNTV was able to support more than 100 million daily streaming requests from over 17 million devices with the assistance of Streaming Dissector.

Peking University Law School—Using Media Dissector to Identify Trends in News Reporting

        In advance of the 2015 annual report of the PRC Supreme People's Court, Peking University Law School used Media Dissector to publish its own report about public perceptions of the court's regulations, policies and rulings. Media Dissector used various text mining techniques to digest more than 30,000 mainstream news reports during 2014 and reconstructed the spread chains of the important events. Media Dissector summarized the ten topics of most interest, eight of which were also highlighted by the Supreme People's Court in its report.

A Large Full-service Law Firm in China—Distilling Litigation Data with Law Dissector

        A large full-service law firm in China used Law Dissector to help it determine legal strategy on behalf of a client in a large copyright infringement case. From a collection of over two million recent civil cases, Law Dissector screened for cases related to copyright infringement involving musical works. Using natural language processing technology, Law Dissector extracted data on variables such as damages requested, final court award, location where alleged infringement occurred, court hearing the litigation and other variables. Law Dissector illustrated the spectrum of court cases graphically, used visualization to identify the most important aspects of the final rulings, and provided the law firm with important information helping it to formulate its legal strategy and select a favorable jurisdiction.

Employees

        We had 268, 425 and 733 employees as of December 31, 2013, 2014 and 2015, respectively. We had 868 employees as of June 30, 2016. All of our employees are based in China.

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        The following table sets out the breakdown of our employees by function as of June 30, 2016:

Function	Number of employees
Research and development		382
Sales and marketing		380
General and administrative		106
Total		868

        We enter into standard employment agreements with all of our employees. We also enter into standard confidentiality and non-compete agreements with our employees. The non-compete restricted period typically expires two years after the termination of employment, and we agree to provide reasonable compensation to the employee during the restricted period.

        In accordance with Chinese regulations, we participate in various employee social security plans that are organized by municipal and provincial governments, including pension insurance, medical insurance, unemployment insurance, maternity insurance, job-related injury insurance and housing fund. We are required by PRC laws to make contributions to employee social security plans at specified percentages of the salaries, bonuses and certain allowances of our employees, up to a maximum amount specified by the local government from time to time.

        None of our employees are covered by collective bargaining agreements, and we consider our relations with our employees to be good.

Operations

        We host our products and serve all our customers from data centers located in Beijing, Shenzhen and Wuhan. We utilize third parties to provide our data center infrastructure and manage the hardware on which our products operate. We utilize industry standard hardware in redundant configurations to minimize service interruptions. We maintain a formal and comprehensive security program designed to ensure the security and integrity of our data, protect against security threats or data breaches and prevent unauthorized access to the data of our customers. Our technology uses multi-tenant architecture, enabling all of our customers to share the same version of our solutions while securely partitioning their data.

Research and Development

        Our research and development organization is responsible for the design, development and testing of all aspects of our dashboard and suite of solutions. We invest heavily in these efforts to continuously improve, innovate and add new features to our solutions.

        We deploy new features, functionality and technologies through periodic software releases or updates in order to minimize disruption and provide for constant improvement. Our product managers regularly engage with customers, partners and industry analysts, as well as other stakeholders, in functions such as sales, customer success, marketing and business development to understand customer needs as well as general trends in our industry. Once product improvements are identified, the development organization works closely together to design, develop, test and launch a solution.

        The majority of our research and development team is based in our Beijing office and to a lesser degree in Shanghai, Shenzhen and Harbin. To foster rapid innovation, our team is further apportioned into small agile development teams.

        Our research and development expenses were RMB20.4 million, RMB38.1 million and RMB100.2 million (US$15.1 million) for the years ended December 31, 2013, 2014 and 2015,

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respectively, and were RMB40.2 million and RMB67.0 million (US$10.1 million) for the six months ended June 30, 2015 and 2016, respectively.

Sales and Marketing

        Our sales and marketing organizations work together closely to drive market awareness, create and manage user and customer leads, provide qualified leads to our sales pipeline and build customer relationships to drive revenue growth.

        We sell our products to enterprise and large businesses through our direct sales organization. Our direct sales organization is comprised of sales and sales support personnel, including customer service consultants, who are organized by industry vertical and focused on a land and expand sales model that is designed to capitalize on the ease of use, low up-front cost and broad functionalities of our platform.

        Our sales organization also includes consulting services and training teams that work with customers to help with configuration, support implementations and increase usage. These efforts include in-person and phone-based engagements, webinars, in-person training and free training.

        Our marketing strategy targets senior executives in the sales, marketing and IT functions of large enterprises across many industries through our direct salesforce. We also leverage both online and offline marketing channels, by sponsoring seminars, hosting industry summits and other events, and conducting search engine marketing promotions. We believe the simplest way to showcase our products is by using them in live or recorded demonstrations. In addition, a central focus of the marketing team is to drive and encourage free trials of our products and the successful conversion of trials to paid subscriptions. We offer short-duration free trials of our solutions.

Customer Support

        Our solutions are designed to minimize the need for customer support, because users can easily deploy and utilize our software services without needing support. However, for all of our customers, we make online and telephonic helpdesk facilities available and provide onsite engineer support.

Data Privacy

        In order to analyze customer data, customers authorize our solutions to deploy monitoring codes to collect necessary end user data, without using sensitive end user data such as name, phone number and email address. Information collected generally includes end user operating system, device and web pages visited. In order to identify each unique user, we associate a random number string with the user upon his or her first visit. We then use that random number string as the anonymous identification for the end user and associate it with all related visit data. If a customer wishes to send sensitive information to us, including personally identifiable information, we recommend that the customer process it with a security algorithm before sending it to us.

Strategic Relationships

Cooperation with State Information Center

        In March 2012, we entered into a six-year cooperation agreement with the State Information Center of China, or SIC, which provides consulting and technology services for governmental agencies. One of the SIC's primary tasks is to lead and promote e-Government initiatives in China, including deployment, establishment, operation and management of the public service websites. In China, the websites of all government agencies that provide public services are hosted in state-owned information centers of different levels of government (e.g., local, municipal, provincial and national). The SIC, under the supervision of the National Development and Reform Commission, is the top level organization of this type in China. Under our cooperation agreement with the SIC, we established a

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non-governmental entity known as the Research Center for e-Government, for the purpose of providing our digital intelligence services to serve government agency websites at all levels throughout China. Our digital intelligence services for governmental agencies are primarily delivered through our Government Web Dissector product and include evaluation of website performance for users and recommendations for improving online service.

        In June 2015, we entered into a framework agreement and a collaboration agreement with an entity that is wholly owned by the SIC, or the SIC Entity. Under these agreements, we and the SIC Entity have established a joint venture company, Beijing Guoxinwangyan, to oversee the business operations, sales and marketing and financial management of the Research Center. Beijing Gridsum and Guoxinjunhe each own 40%, and the SIC Entity owns 20%, of the equity interest in Beijing Guoxinwangyan. The board of directors of the joint venture company will consist of three members, and each equity owner will have the right to nominate one director. The framework agreement provides that the intellectual property rights with respect to Government Web Dissector and other related software systems developed by Beijing Gridsum will exclusively belong to Beijing Gridsum, and the intellectual property rights with respect to research reports and training materials will exclusively belong to the joint venture company.

Collaboration Projects with Leading Universities

        We have established research and technology collaboration projects with leading universities to promote leading-edge technologies in our business. Our collaboration project with Renmin University of China, launched in July 2014 when we established the Renmin University of China—Gridsum Big Data Laboratory, has a focus on the joint research, development and monetization of natural language processing and database technologies. Our collaboration project with Peking University School of Law, launched in December 2014, will spearhead the studies of the legislative initiatives in the internet and big data-related fields in China, including privacy protection, data ownership and security and IP protection. Our collaboration with Harbin Institute of Technology, launched in March 2015 by establishing the Harbin Institute of Technology—Gridsum Big Data Laboratory, has a focus on data mining and natural language processing technologies. These collaboration projects also serve as a talent reservoir where we can recruit the research and development personnel.

Cooperation with PRC Supreme People's Court Press

        In January 2016, we entered into a strategic cooperation agreement with the People's Court Press, which established a framework for the application of our sophisticated data analytics to legal information services. We have collaborated with the People's Court Press to develop the Chinese Legal Information Platform (or "Faxin" in Chinese) and launched it in March 2016. Faxin is designed with tools in our Information Discovery Suite to manage legal information and resources and enable access to judicial precedents and legal information for the legal profession. Since its launch, Faxin has been well recognized by the PRC Supreme People's Court and its chief justice and has been recommended to many provincial and municipal courts in China and some local courts have started using the free trial service of the Faxin platform and expressed interests for long-term cooperation. Faxin has been adopted by the PRC Supreme People's Court and the Higher People's Court of Jiangsu Province. We intend to continue collaborating with People's Court Press to launch more services and extend our services to the broader legal service community, and eventually to the general public.

        Our cooperation with the People's Court Press may take a variety of forms, including product development, research and joint venture activities. Under this arrangement, the People's Court Press will provide updated judicial information, including verdicts, legal briefs and other legal resources, and we will provide our Law Dissector and our natural language processing technologies, along with personnel for research and development, data analytics and sales and marketing for the joint venture. The rights to any intellectual property contributed by a party, and any related upgrades, will remain

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with the contributing party, and the other party will have a license to use that intellectual property under the terms of the cooperation agreement. Jointly developed intellectual property will be owned by both parties in a proportion to be agreed between them. The initial term of the cooperation agreement is three years, after which the agreement is extended automatically for two years unless either party objects prior to the extension.

Competition

        Our current primary competitors consist of companies offering marketing analytics such as Google, IBM, Microsoft and Oracle, and companies offering bid management products, such as adSage, MediaV and Adobe Efficient Frontier. The principal competitive factors in our market include:

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solution features, performance and effectiveness;

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breadth of product offerings;

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suitability for Chinese users;

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experience in handling large volumes of data;

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data analytics expertise;

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ease of use; and

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strength of sales and marketing efforts.

        Most recently, each of IBM, Oracle and Salesforce.com have begun offering "marketing cloud" solutions to customers, and we believe these companies and Adobe are our primary competitors in the market for marketing automation solutions.

        We believe that we generally compete favorably with our competitors on the basis of these factors. Many of our competitors have substantially greater financial, technical and other resources, greater name recognition, larger sales and marketing budgets, broader distribution and larger or more mature intellectual property portfolios.

Intellectual Property

        We rely on a combination of trademark, fair trade practice, copyright and trade secret protection laws and patent protection in China and other jurisdictions, as well as contractual restrictions, to protect our intellectual property. We control access to our proprietary technology and algorithms by entering into confidentiality and invention assignment agreements with our employees and contractors and confidentiality agreements with third parties. As of August 10, 2016, we had 44 issued patents in China, which will expire between 2024 and 2033, 1,169 patent applications pending in China and 18 patent applications pending in various other countries and jurisdictions.

        Despite our efforts to protect our proprietary technology and our intellectual property rights, unauthorized parties may attempt to copy or obtain and use our technology to develop applications with the same functionality as our products. Policing unauthorized use of our technology and intellectual property rights is difficult.

        We expect that software in our industry may be subject to third-party infringement claims as the number of competitors grows and the functionality of applications in different industry segments overlaps. Any of these third parties might make a claim of infringement against us at any time.

Facilities

        Our corporate headquarters, which includes sales, marketing, business operations and executive offices, is located in Beijing, China and consists of approximately 3,865 square meters of office space

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under 17 annual leases that will expire beginning in December 2016. In addition to our headquarters, we lease space in Shanghai, Guangzhou, Shenzhen and Chengdu. In addition, we maintain data centers in Beijing and Shenzhen.

        We lease all of our facilities and do not own any real property. We intend to procure additional space as we add employees and expand geographically. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate any such expansion of our operations.

Legal Proceedings

        From time to time we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. We are not presently a party to any legal proceedings that in the opinion of our management, if determined adversely to us, would have a material adverse effect on our business, financial condition, operating results or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

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PRC REGULATION

        Our business operations are primarily in the PRC and are primarily subject to PRC laws and regulations. The following is a summary of the most significant PRC laws and regulations affecting our business or our shareholders' rights to receive dividends and other distributions from us.

Regulations on Internet Information Service

        There are several principal regulations on internet information service business with respect to foreign investment restriction and qualification requirement, including (i) the Telecommunications Regulations of the People's Republic of China, promulgated by the State Council on September 25, 2000, as most recently amended on February 6, 2016, (ii) the Administrative Measures on Internet Information Services, promulgated by the State Council on September 25, 2000, or the Internet Measures, (iii) the Administrative Rules for Foreign Investment in Telecommunications Enterprises issued by the State Council effective on January 1, 2002, as most recently amended on February 6, 2016, and (iv) the Guidance Catalogue of Industries for Foreign Investment (2015 Revision), promulgated by the MOFCOM and the National Development and Reform Commission effective on April 10, 2015, or the Catalogue.

        The Telecommunications Regulations of the People's Republic of China, the Administrative Rules for Foreign Investment in Telecommunications Enterprises and the Catalogue prescribe line between different types of telecommunications business activities, including basic telecommunications services and value-added telecommunications services, and internet information service is categorized as value-added telecommunications service falling in the restricted category. Under these regulations, the proportion of foreign investment in companies conducting value-added telecommunications services (excluding e-commerce) shall not exceed 50%, and the foreign investor must have experience in providing value-added telecommunications services overseas and maintain a good track record. Due to these restrictions on foreign investment, we operate our internet information service business through Gridsum PRC Holding, our VIE, and its subsidiaries through contractual arrangements.

        The Internet Measures divide internet information services into two categories: services of an operative nature and services of a non-operative nature. Our business conducted through our website (under domain name www.gridsum.com) involves operative internet information services, which requires us to obtain an ICP license. Our affiliated PRC entity and a subsidiary of our VIE, Beijing Gridsum, obtained an ICP license issued by Beijing Communications Administration, a local branch of the Ministry of Industry and Information Technology, or the MIIT, in July 2015.

Regulations on Market Survey Business

        There are several principal regulations on market survey business in terms of foreign investment restriction and qualification requirement, including (i) the Catalogue and (ii) the Measures on the Administration of Foreign-related Surveys, promulgated by the PRC National Bureau of Statistics on October 13, 2004.

        The Catalogue classifies market surveys as falling in the restricted category, stating that market surveys shall be limited to sino-foreign equity or cooperative joint venture operations, and specifically, Chinese parties shall be controlling shareholders for survey of television and radio program ratings. We conduct our market survey business of television and radio program ratings in the PRC through contractual arrangements with our VIE in compliance with the Catalogue.

        The Measures on the Administration of Foreign-related Surveys define foreign-related market surveys as those including (i) market and social surveys conducted under the entrustment or with the financial aid of, or in cooperation with, any overseas organization, individual or any overseas organization's agency in the PRC, (ii) market surveys conducted by any overseas organization's agency

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in the PRC in accordance with applicable laws and (iii) market and social surveys wherein survey materials and results are to be provided to any overseas organization, individual or overseas organization's agency in the PRC. Such surveys must be conducted through a survey institution possessing a foreign-related survey permit in accordance with applicable laws. We conduct foreign-related market surveys primarily through Beijing Moment, a subsidiary of our VIE, and have obtained a foreign-related survey permit as of November 2015.

Regulations on Advertising Business

        The Advertising Law of the People's Republic of China, promulgated by the Standing Committee of the National People's Congress on April 24, 2015, is the principal law regulating our advertising business. This law states that a company engaged in advertising activities shall obtain from the State Administration for Industry and Commerce and the MOFCOM, or their respective local branches, a business license which specifically includes operation of advertising business in its business scope. Our advertising business is operated by our consolidated affiliated entities in the PRC whose business licenses include advertising business operation in the business scope.

        Prior to June 29, 2015, our advertising business had been regulated by the Regulations for the Administration of Foreign-Invested Advertising Enterprises, promulgated by the State Administration for Industry and Commerce and the MOFCOM effective on October 1, 2008, which prescribed restrictions on foreign investors in advertising business, stating in particular that those who establish a wholly foreign-owned advertising enterprise shall, among other things, be an enterprise that is mainly engaged in advertising business and have been established and engaged in its business for at least three years. We conduct our advertising business in the PRC through our consolidated affiliated entities, which are Chinese domestic enterprises and therefore are not subject to the aforesaid requirements. The Regulations for the Administration of Foreign-Invested Advertising Enterprises were abolished on June 29, 2015 by the State Administration for Industry and Commerce after consultation with the MOFCOM.

Regulations on Government Procurement

        On June 29, 2002, the Standing Committee of the National People's Congress promulgated the Government Procurement Law of the People's Republic of China, which came into effect on January 1, 2003 and was amended on August 31, 2014. This law was enacted for purposes of regulating government procurement activities and applies to government procurement activities conducted within the PRC. It prohibits suppliers from (i) providing false materials in an attempt to win a bid, (ii) defaming or excluding other suppliers by illegitimate means, (iii) colluding with the procuring entity or agency, or other suppliers, (iv) bribing or providing illegitimate benefits to the procuring entity or agency, (v) in the course of procurement through bid invitation, engaging in consultation or negotiation with the procuring entity or (vi) refusing to subject themselves to supervision by the relevant department or providing false information. Our business with the government is required to comply with these rules and requirements.

Regulations on Intellectual Property Rights

        China has adopted legislation governing intellectual property rights, including copyrights, trademarks and patents. China is a signatory to major international conventions on intellectual property rights and is subject to the Agreement on Trade Related Aspects of Intellectual Property Rights as a result of its accession to the World Trade Organization in December 2001.

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Computer Software Copyright

        On March 1, 2013, the Regulations for the Protection of Computer Software promulgated by the State Council came into effect. These regulations are formulated for protecting the rights and interests of computer software copyright owners, encouraging the development and application of computer software and promoting the development of software business. As of August 10, 2016, we had 69 registered copyrights, including 63 registered computer software copyrights in the PRC.

Patent

        Patents in the PRC are principally protected under the Patent Law of the People's Republic of China, which was amended by the Standing Committee of the National People's Congress as of October 1, 2009. This law is formulated for protecting the rights and interests of patentees, encouraging invention, promoting the application of inventions, enhancing innovation capacity, and facilitating the advancement of science and technology and the economic and social development. Under this law, the duration of a patent right is either 10 years or 20 years from the date of application, depending on the type of patent right. As of August 10, 2016, we had 44 patents granted in the PRC, 1,169 patent applications pending in the PRC and 18 patent applications pending in various other countries and jurisdictions.

Trademark

        The PRC Trademark Law, effective in 1983 and most recently amended in 2014, protects the proprietary rights with respect to registered trademarks. The Trademark Office under the State Administration for Industry and Commerce handles trademark registrations and may grant a term of 10 years for registered trademarks, which may be extended for another 10 years upon request. Trademark license agreements shall be filed with the Trademark Office for record. In addition, if a registered trademark is recognized as a well-known trademark, the protection of the proprietary right of the trademark holder may reach beyond the specific class of the relevant products or services. As of August 10, 2016, we had 168 registered trademarks in different trademark categories and 41 trademark applications in the PRC.

Domain Name

        On December 20, 2004, the Measures for the Administration of Internet Domain Names of the PRC, promulgated by the Ministry of Information, came into effect. These measures are formulated with reference to the norms on administration of internet domain names worldwide, for the purposes of promoting the healthy development of China's internet sector and guaranteeing the safe and reliable operation of the internet domain name system in the PRC. As of August 10, 2016, we had 62 registered domain names in the PRC.

Regulations on Privacy Protection

        As an internet content provider, we are subject to regulations relating to the protection of privacy. Under the Internet Measures, internet content providers are prohibited from producing, copying, publishing or distributing information that is humiliating or defamatory to others or that infringes on the lawful rights and interests of others. Internet content providers that violate the prohibition could face criminal charges or administrative sanctions by the PRC security authorities. In addition, relevant authorities may suspend their services, revoke their licenses or temporarily suspend or close down their websites. Under the Several Provisions on Regulating the Market Order of Internet Information Services, issued by the MIIT in December 2011, internet content providers are prohibited from collecting any user-related information that can reveal the identity of the user whether by itself or when used in combination with other information, or providing any such information to third parties without

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the consent of a user. Internet content providers must expressly inform the users of the method, content and purpose of the collection and processing of such user personal information and may only collect such information necessary for their services. Internet content providers are also required to properly maintain the user personal information and, in case of any leakage or likely leakage of user personal information, must take remedial measures immediately and report any material leakage to the telecommunications regulatory authority. In addition, the Decision on Strengthening Network Information Protection promulgated by the Standing Committee of the National People's Congress in December 2012 emphasizes the need to protect electronic information that contains personal identification information and other private data. The decision requires internet content providers to establish and publish policies regarding the collection and use of personal electronic information and to take necessary measures to ensure the security of the information and to prevent leakage, damage or loss. Furthermore, the MIIT's Rules on Protection of Personal Information of Telecommunications and Internet Users issued in July 2013 contain detailed requirements on the use and collection of personal information as well as the security measures to be taken by internet content providers. The PRC government retains the power and authority to order internet content providers to provide an internet user's personal information if such user posts any prohibited content or engages in any illegal activities through the internet.

Regulations on Employment

        There are several principal rules and regulations in the PRC with respect to rights and obligations of employers and labors, including (i) the Labor Law of the People's Republic of China, promulgated by the Standing Committee of the National People's Congress effective on January 1, 1995, or the Labor Law, (ii) the Labor Contract Law of the People's Republic of China, promulgated by the Standing Committee of the National People's Congress effective on July 1, 2013, or the Labor Contract Law, (iii) the Social Insurance Law of the People's Republic of China, promulgated by the Standing Committee of the National People's Congress effective on July 1, 2011, or the Social Insurance Law, and (iv) the Regulations on the Management of Housing Provident Fund, promulgated by the State Council on March 24, 2002.

        According to the Labor Law and the Labor Contract Law, employers must execute written labor contracts with full-time employees. All employers must compensate their employees with wages equal to at least the local minimum wage standards. All employers are required, among other things, to establish a system for labor safety and workplace sanitation and provide employees with workplace safety training. Violations of the Labor Law and the Labor Contract Law may result in the imposition of fines and other administrative penalties. For serious violations, criminal liability may arise. In addition, pursuant to the Social Insurance Law, employers in the PRC are required to provide employees with welfare schemes covering pension insurance, unemployment insurance, maternity insurance, work-related injury insurance, medical insurance and housing funds.

Regulations on Taxation

PRC Enterprise Income Tax

        PRC enterprise income tax is calculated based on taxable income, which is determined under (i) the PRC Enterprise Income Tax Law, promulgated by the National People's Congress of China and implemented on January 1, 2008, or the EIT Law, and (ii) the implementation rules to the EIT Law promulgated by the State Council and implemented on January 1, 2008. The EIT Law imposes a uniform enterprise income tax rate of 25% on all resident enterprises in the PRC, including foreign-invested enterprises and domestic enterprises, unless they qualify for certain exceptions. According to the EIT Law and its implementation rules, the income tax rate of an enterprise that has been determined to be a high and new technology enterprise may be reduced to 15% with the approval of relevant tax authorities.

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        In addition, according to the EIT Law, enterprises registered in countries or regions outside the PRC but have their "de facto management bodies" located within China may be considered as PRC resident enterprises and are therefore subject to PRC enterprise income tax at the rate of 25% on their worldwide income. Though the implementation rules of the EIT Law define "de facto management bodies" as "establishments that carry out substantial and overall management and control over the manufacturing and business operations, personnel, accounting, properties, etc. of an enterprise," the only detailed guidance currently available for the definition of "de facto management body" as well as the determination and administration of tax residency status of offshore-incorporated enterprises are set forth in the Notice Regarding the Determination of Chinese-Controlled Overseas Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, or Circular 82, and the Administrative Measures for Enterprise Income Tax of Chinese-Controlled Overseas Incorporated Resident Enterprises (Trial Version), or Bulletin No. 45, both issued by the State Administration of Taxation, or the SAT, which provide guidance on the administration as well as determination of the tax residency status of a Chinese-controlled offshore-incorporated enterprise, defined as an enterprise that is incorporated under the law of a foreign country or territory and that has a PRC company or PRC corporate group as its primary controlling shareholder.

        According to Circular 82, a Chinese-controlled offshore-incorporated enterprise will be regarded as a PRC tax resident by virtue of having its "de facto management body" in China and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met:

•

the primary location of the day-to-day operational management and the places where they perform their duties are in the PRC;

•

decisions relating to the enterprise's financial and human resource matters are made or are subject to approval of organizations or personnel in the PRC;

•

the enterprise's primary assets, accounting books and records, company seals and board and shareholder resolutions are located or maintained in the PRC; and

•

50% or more of voting board members or senior executives habitually reside in the PRC.

        Bulletin No. 45 further clarifies certain issues related to the determination of tax resident status and competent tax authorities. It also specifies that when provided with a copy of Recognition of Residential Status from a resident Chinese-controlled offshore-incorporated enterprise, a payer does not need to withhold a 10% income tax when paying certain PRC-sourced income such as dividends, interest and royalties to such Chinese-controlled offshore-incorporated enterprise. In the event that we are considered a PRC resident enterprise, we would be subject to the PRC enterprise income tax at the rate of 25% on our worldwide income.

        The Arrangement Between the PRC and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Prevention of Fiscal Evasion With Respect to Taxes on Income is promulgated by the SAT and implemented on September 27, 2006. This arrangement reduces withholding tax rate in respect of the payment of dividends by a PRC enterprise to a Hong Kong enterprise from a standard rate of 10% to 5% if the Hong Kong enterprise directly holds at least 25% of the PRC enterprise. Pursuant to the Notice of the State Administration of Taxation on the Issues concerning the Application of the Dividend Clauses of Tax Agreements, or Circular 81 a Hong Kong resident enterprise must meet the following conditions, among others, in order to enjoy the reduced withholding tax rate: (i) it must be a company; (ii) it must directly own the required percentage of equity interests and voting rights in the PRC resident enterprise; and (iii) it must have directly owned such required percentage in the PRC resident enterprise throughout the 12 months prior to receiving the dividends. Furthermore, the Administrative Measures for Non-Resident Taxpayers to Enjoy Treatments under Tax Treaties, or Non-Resident Tax Treatments Measures, which became effective in November 2015, require that non-resident taxpayers must report and submit the relevant statements

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and materials specified in this measure and be administrated and supervised subsequently by the relevant tax authority in order to enjoy the reduced withholding tax rate. There are also other conditions for enjoying the reduced withholding tax rate pursuant to other applicable tax rules and regulations.

Income Tax for Share Transfers

        According to the Notice on Strengthening Administration of Enterprise Income Tax for Share Transfers by Non-Resident Enterprises, or Circular 698, promulgated by the SAT on December 10, 2009, and the Announcement of the State Administration of Taxation on Several Issues Concerning the Enterprise Income Tax on Indirect Property Transfer by Non-Resident Enterprises, or Circular 7, promulgated by the SAT on February 3, 2015, if a non-resident enterprise transfers the equity interests of a PRC resident enterprise indirectly by transfer of the equity interests of an offshore holding company (other than a purchase and sale of shares issued by a PRC resident enterprise in public securities market) without a reasonable commercial purpose, the PRC tax authorities have the power to reassess the nature of the transaction and the indirect equity transfer will be treated as a direct transfer. As a result, the gain derived from such transfer, which means the equity transfer price less the cost of equity, will be subject to PRC withholding tax at a rate of up to 10%. Under the terms of Circular 7, the transfer which meets all of the following circumstances shall be directly deemed as having no reasonable commercial purposes: (i) over 75% of the value of the equity interests of the offshore holding company are directly or indirectly derived from PRC taxable properties; (ii) at any time during the year before the indirect transfer, over 90% of the total properties of the offshore holding company are investments within PRC territory, or in the year before the indirect transfer, over 90% of the offshore holding company's revenue is directly or indirectly derived from PRC territory; (iii) the function performed and risks assumed by the offshore holding company are insufficient to substantiate its corporate existence; or (iv) the foreign income tax imposed on the indirect transfer is lower than the PRC tax imposed on the direct transfer of the PRC taxable properties.

        There is uncertainty as to the application of Circular 698 and Circular 7. Circular 698 and Circular 7 may be determined by the PRC tax authorities to be applicable to our prior private equity financing transactions that involved non-resident investors, if any of such transactions were determined by the tax authorities to lack reasonable commercial purpose. As a result, we and our non-resident investors in such transactions may become at risk of being taxed under Circular 698 and Circular 7, and we may be required to expend valuable resources to comply with Circular 698 and Circular 7 or to establish that we should not be taxed under the general anti-avoidance rule of the EIT Law, which may have a material adverse effect on our financial condition and results of operations.

PRC Business Tax

        Pursuant to applicable PRC tax regulations, any entity or individual conducting business in the service industry is generally required to pay a business tax at the rate of 5% on the revenues generated from providing such services. However, if the services provided are related to technology development and transfer, such business tax may be exempted subject to the approval of relevant tax authorities.

Value Added Tax

        On January 1, 2012, the State Council officially launched a pilot value-added tax, or VAT, reform program, or the Pilot Program, applicable to businesses in selected industries, such as industries involving the leasing of tangible movable property, transportation services, research and development and technical services, information technology services, cultural and creative services, logistics and ancillary services and certification and consulting services. Businesses subject to the Pilot Program would pay VAT instead of business tax. The Pilot Program was launched in Beijing on September 1, 2012, and in Guangdong province on November 1, 2012. On May 24, 2013, the Ministry of Finance and

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the SAT issued the Circular on Tax Policies in the Nationwide Pilot Collection of Value Added Tax in Lieu of Business Tax in the Transportation Industry and Certain Modern Services Industries. On August 1, 2013, the Pilot Program was implemented throughout China. On May 1, 2016, the Pilot Program was implemented to include more industries, including construction, real estate, finance and consumer services.

Dividends Withholding Tax

        We are a Cayman Islands holding company and substantially all of our income may come from dividends we receive from our PRC subsidiary. Pursuant to the EIT Law and its implementation rules, dividends generated after January 1, 2008 and distributed to us by our PRC subsidiary are subject to withholding tax at a rate of 10%.

        As uncertainties remain regarding the interpretation and implementation of the EIT Law and its implementation rules, we cannot assure you that, if we are deemed a PRC resident enterprise, any dividends to be distributed by us to our non-PRC shareholders and ADS holders would not be subject to any PRC withholding tax.

Regulations on Foreign Exchange

        The Regulations of the People's Republic of China on Foreign Exchange Control, promulgated by the State Council on August 5, 2008, are principal regulations on foreign currency exchange in the PRC. Under these regulations, the RMB is freely convertible for current account items after due process, including distribution of dividends, trade-related foreign exchange transactions and service-related foreign exchange transactions, whereas foreign exchange for capital account items, such as direct investments or loans, requires prior approval of and registration with the SAFE.

Capital Settlement and Overseas Remittance of Foreign-Invested Enterprises

        On June 1, 2015, the Notice of the State Administration of Foreign Exchange on Reforming the Administrative Approach Regarding the Settlement of the Foreign Exchange Capitals of Foreign-invested Enterprises came into effect and then was specified by the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Administrative Provisions on Capital Account Foreign Exchange Settlement promulgated on June 9, 2016, which helps further deepen the reform of the foreign exchange administration system and better satisfy and facilitate the needs of FIEs for business and fund operations. This notice allows FIEs to settle their foreign exchange capitals on a discretionary basis. Moreover, the Provisions on Foreign Exchange Administration Over Direct Investment Made by Foreign Investors in the PRC were promulgated by the SAFE on May 13, 2013 in order to promote and facilitate foreign investors to make direct investment in the PRC, which allow a FIE that needs to remit funds abroad to purchase and remit foreign exchange with the relevant bank due to capital reduction, liquidation, advance recovery of investment, profit distribution, etc. after due registration.

Outbound Investment, Financing and Roundtrip Investment

        On July 4, 2014, the Circular on the Relevant Issues Concerning Foreign Exchange Control on Domestic Residents Outbound Investment and Financing and Roundtrip Investment though Special Purpose Vehicles came into effect, which was promulgated by the SAFE to make full use of domestic and international resources and markets. This circular prescribes operational procedures and registration requirements for roundtrip investment though special purpose companies and others. In particular, it states that a domestic resident shall apply to the relevant local branch of the SAFE for foreign exchange registration of overseas investment, prior to making contribution to a special purpose company with legitimate domestic or overseas assets or interests.

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Equity Incentive Plans

        On February 15, 2012, the Circular of SAFE on Relevant Issues Concerning the Foreign Exchange Administration for Domestic Individuals' Participation in Equity Incentive Plans of Overseas-Listed Companies came into effect. This notice prescribes foreign exchange procedural requirements for domestic individuals such as directors, supervisors, officials and other employees in relation to equity incentive plans of companies listed abroad, including employee stock ownership plans, employee stock option plans and other equity incentive programs permitted by applicable laws and regulations. Under the notice, individuals who participate in equity incentive plans of the same overseas listed company shall, through the domestic companies they serve, collectively entrust a domestic agency to handle matters such as foreign exchange registration with the SAFE, account opening, and funds transfer and remittance, and entrust an overseas institution to handle matters such as exercise of options, purchasing and sale of related equity and funds transfer. Besides, an individual may use his/her own foreign currency funds in his/her personal foreign currency deposit account, RMB funds or other legitimate domestic funds to participate in an equity incentive plan.

Regulations on Dividend Distribution

        The principal legislation with respect to payment or distribution of dividends by wholly foreign-owned enterprises include (i) the Company Law of the People's Republic of China, most recently amended by the Standing Committee of the National People's Congress as of March 1, 2014, and (ii) Wholly Foreign-Owned Enterprise Law of the People's Republic of China, promulgated on April 12, 1986 and amended on October 31, 2000 by the Standing Committee of the National People's Congress. Under these laws, wholly foreign-owned enterprises in the PRC may pay dividends only out of accumulated profits, after setting aside annually at least 10% of accumulated after-tax profits as reserve fund, if any, until such time as the accumulative amount of such fund reaches 50% of the enterprise's registered capital. A wholly foreign-owned enterprise may allocate a portion of its after-tax profits to its employee welfare and bonus funds at its discretion. These reserve funds may not be distributed as cash dividends.

M&A Regulations and Overseas Listings

        PRC regulatory agencies, including the CSRC, have jointly promulgated the M&A Rules. The M&A Rules require offshore SPVs formed for listing purposes through acquisition of PRC domestic companies and controlled by PRC companies or individuals, to obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock exchange.

        We believe that CSRC approval is not required in the context of this offering as we are not a special purpose vehicle formed for listing purpose through acquisition of domestic companies that are controlled by our PRC individual shareholders, as we acquired contractual control rather than equity interests in our domestic affiliated entities.

        However, the application of the M&A Rules remains unclear. We cannot assure you that the relevant PRC government agency, including the CSRC, would reach the same conclusion as we do. If the CSRC or any other PRC regulatory agency subsequently determines that we need to obtain the CSRC's approval for this offering or if the CSRC or any other PRC government authorities will promulgate any interpretation or implementing rules before our listing that would require the CSRC or other governmental approvals for this offering, we may face sanctions by the CSRC or other PRC regulatory agencies. In such event, these regulatory agencies may impose fines and penalties on our operations in the PRC, limit our operating privileges in the PRC, delay or restrict the repatriation of the proceeds from this offering into the PRC or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of the ADSs. The CSRC or other PRC regulatory agencies may also take actions requiring us to halt this offering before settlement and delivery of the ADSs offered by this prospectus.

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MANAGEMENT

Directors and Executive Officers

        The following table sets forth information regarding our directors and executive officers as of the date of this prospectus. The business address of each of our directors and executive officers is Beijing Gridsum Technology Co., Ltd., Jade Palace Hotel Office Building, 8^th Floor, 76 Zhichun Road, Haidian District, Beijing 100086, People's Republic of China.

Directors and Executive Officers	Age		Position/Title
Guosheng Qi		32	Chairman of the Board, Chief Executive Officer
Guofa Yu		42	Director, Chief Operating Officer
Perry Lin Chui*		44	Director
Xiang Fan		40	Director
Yanchun Bai		50	Director
Xudong Gao		50	Director
Thomas A. Melcher		53	Director
Peter Andrew Schloss		55	Director
Michael Peng Zhang		46	Chief Financial Officer
John Jiyang Liu		51	Chief Technology Officer
Aaron Feng Li		43	Co-President
Michael Yang Xu		45	Co-President
Xin Wang		58	Vice President

*

Mr. Chui has advised us of his intention to resign as a director upon the completion of this offering.

Guosheng Qi is one of our co-founders and has served as our chief executive officer and chairman of our Board of Directors since our inception. Mr. Qi founded Beijing Gridsum in 2005 when he was a student at Tsinghua University. Mr. Qi holds a bachelor's degree in computer software from Tsinghua University.

Guofa Yu is one of our co-founders and has served as our chief operating officer and a member of our Board of Directors since 2005. Mr. Yu served as the operation director of Dyne Junhui, an information technology company, in 2005. Prior to that, Mr. Yu served as a project director of Founder Group, an information technology company, from 2002 to 2005. From 2000 to 2002, Mr. Yu served in technology and management roles in several small technology companies. From 1998 to 2000, Mr. Yu served as a software engineer at Neusoft Group, a software company. Mr. Yu holds a bachelor's degree in management information systems from Central South University.

Perry Lin Chui has served as a member of our Board of Directors since 2010. Mr. Chui is a general partner of Steamboat Ventures, a venture capital firm, which he joined in August 2008, most recently serving as a partner in its Shanghai office. Prior to that, Mr. Chui served as a senior associate of Rho Ventures, a venture capital firm based in New York, from 2005 to 2008. Mr. Chui currently serves on the boards of directors of a number of portfolio companies of Steamboat Ventures. Mr. Chui holds a master's degree in computer science from University of Texas and an MBA degree from Cornell University Johnson School of Management.

Xiang Fan has served as a member of our Board of Directors since 2015. Mr. Fan is a managing director of Goldman Sachs, an investment banking firm, which he joined in 2007. Mr. Fan was an associate of KKR, a private equity investment firm, from 2006 to 2007, and an associate at Goldman Sachs from 2004 to 2006. Mr. Fan currently serves on the boards of directors of a number of portfolio companies of Goldman Sachs, including China Shengmu Organic Milk Limited and Yadea Group Holdings Ltd., each of which is listed on the Hong Kong Stock Exchange. Mr. Fan holds a bachelor's

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degree in economics and computer science from Yale University and an MBA degree from University of Pennsylvania.

Yanchun Bai has served as a member of our Board of Directors since 2012. Mr. Bai has been a partner at the Commerce & Finance Law Office, a law firm, since May 2013. Prior to that, Mr. Bai was a partner at King & Wood Mallesons, a law firm, from 1993 to May 2013. Mr. Bai currently serves as a member of the board of directors of China Molybdenum Co., Ltd., a company listed on the Hong Kong Stock Exchange. Mr. Bai holds a bachelor's degree in law from China University of Political Science and Law and an LLM degree from Stanford Law School.

Xudong Gao has served as a member of our Board of Directors since 2006. Mr. Gao has served as the vice director of Tsinghua University Research Center for Technological Innovation since June 2011. Mr. Gao has been a member of the Ministry of Industry and Information Technology's Expert Committee of Telecom Economy since January 2010. Mr. Gao also served as a director of the Tsinghua MBA program from 2008 to June 2011. Mr. Gao is currently a professor at the School of Economics and Management, Tsinghua University. Mr. Gao holds a bachelor's degree in industrial engineering from Harbin Institute of Technology, a master's degree in economics from Renmin University of China and a Ph.D. degree in management from Massachusetts Institute of Technology.

Thomas A. Melcher has served as a member of our Board of Directors since 2008. Mr. Melcher has served as the chief executive officer of F-101, Inc., an internet media company, since February 2015. Mr. Melcher served as the interim chief marketing officer of MongoDB, Inc., a software and services company, from June 2014 to February 2015, and as the senior vice president, international of Chegg Inc., an education services company, from September 2011 to September 2012. Mr. Melcher served as the chairman of the board of Zinch China, Inc., an education services company, from 2009 to 2011. Mr. Melcher serves on the boards of directors of a number of private companies. Mr. Melcher holds a bachelor's degree in political science from Yale University and an MBA degree from Harvard University.

Peter Andrew Schloss has served as a member of our Board of Directors since 2016. Mr. Schloss has served as the managing partner and chief executive officer of CastleHill Partners since November 2015. Mr. Schloss has been serving as a director of Zhaopin Limited, a China-based career platform listed on the New York Stock Exchange, since February 2016, and a director and the audit committee chairman of YY, Inc., an interactive social platform listed on the NASDAQ Stock Market, since 2012. Previously, Mr. Schloss was a director and the audit committee chairman of Giant Interactive Group Inc., a China-based online game developer and operator, from 2007 to 2015, and a partner at Phoenix Media Fund L.P., a private equity fund established by Phoenix Television Group to invest in media and culture-related companies in China, from 2012 to May 2016. From 2009 to 2012, Mr. Schloss served as the founder and chief executive officer of Allied Pacific Sports Network Limited, a leading over-the-top provider of live and on-demand sports in Asia. Prior to joining Allied Pacific Sports Network Limited, Mr. Schloss worked at TOM Online Inc., serving as the chief financial officer from 2003 to 2005, as an executive director from 2004 to 2007 and as the chief legal officer from 2005 to 2007. Mr. Schloss holds a bachelor's degree in political science and a juris doctor degree from Tulane University.

Michael Peng Zhang has served as our chief financial officer since February 2014. Prior to joining us, Mr. Zhang served as a managing director of Cowen & Company, an investment banking firm, from 2008 to January 2013. Prior to that, Mr. Zhang served as a principal of ThinkEquity Partners LLC, an investment banking firm, from 2005 to 2007. Mr. Zhang also held management and operational positions at China Guangdong Nuclear Power Holding, a clean energy company, Shenzhen Techlink Science & Technologies, a technology company, and Stephens Inc., a financial services firm, from 1992 to 2005. Mr. Zhang holds a bachelor's degree in economics from Renmin University of China and a master's degree in business administration from Wake Forest University. Mr. Zhang is a Certified Public Accountant and a Chartered Financial Analyst.

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John Jiyang Liu has served as our chief technology officer since December 2014. Prior to joining us, Mr. Liu was an engineer, research manager and R&D director of Microsoft Corporation, a software company, from 1998 to December 2014, and an engineer at Hewlett-Packard Company, a computer company, from 1994 to 1998. Mr. Liu served as a researcher at University of Paderborn from 1989 to 1990. Mr. Liu holds a bachelor's degree in computer science from Tsinghua University and a master's degree in computer science from University of Pittsburgh.

Aaron Feng Li has served as our co-president since 2009. Prior to joining us, Mr. Li served as the general manager of the key account division and general manager of the East China branch of Baidu, Inc. from 2004 to 2008. Prior to that, Mr. Li was the sales director of China eNet Internet Co., an internet media company, from 2000 to 2004. Mr. Li served as the chief representative of the Beijing region of Xiamen Powerlong Industrial Co., Ltd., a technology company, from 1991 to 1995. Mr. Li holds a bachelor's degree in industrial analysis from Qiqihar University and a Global Executive MBA degree from China Europe International Business School.

Michael Yang Xu has served as our co-president since April 2008. Prior to that, Mr. Xu served as the general manager of multiple divisions of Sinochem Tianjin Co Limited, a subsidiary of Sinochem Group, from 2005 to 2007. Mr. Xu also held various investment and management positions at Sinochem Group, a Chinese state-owned chemical enterprise, from 1994 to 1999, including serving as financial controller of Zhonghuan Jinyuan Real Estate Co limited, a subsidiary of Sinochem Group. Mr. Xu is currently a director of Search Engine Marketing Professional Organization, also known as SEMPO, and the chairman of SEMPO's Greater China working group. Mr. Xu holds a bachelor's degree in accounting from Renmin University of China, a master's degree in telecommunication systems from California State University, East Bay, and an MBA degree from California State University, East Bay.

Xin Wang has served as our vice president in charge of our e-Government business since July 2015. From July 2012 to July 2015, Mr. Wang served as our part-time consultant. Mr. Wang held various positions with Microsoft China, a software company, with his last role as a general manager of general industry, from January 2005 to May 2011. Prior to that, Mr. Wang served first as a channel director and then as a distribution director of EMC Corporation, an information storage and services company, from 2001 to 2005. Mr. Wang also served first as a district sales manager and then as a national sales manager of 3Com Corporation, a computer networking solutions company, from 1999 to 2001. Mr. Wang holds a bachelor's degree in electronic technology from a branch school of Tsinghua University.

Employment Agreements and Indemnification Agreements

        We have entered into employment agreements with each of our executive officers. Under these agreements, we may terminate employment for cause, at any time, without advance notice or remuneration, for certain acts of the executive officer, such as conviction of a criminal offense, fraud or dishonesty, material misconduct or material failure to discharge the officer's duties to our detriment. An executive officer may terminate his employment at any time with a thirty-day prior written notice.

        Each executive officer has agreed to hold in strict confidence and not to use or disclose to any person, corporation or other entity any of our proprietary information or trade secrets. Each executive officer has also agreed to assign to our company all inventions and works of authorship which the executive officer develops during the period of his or her employment with us that are either related to the scope of the employment or make use of the resources of our company. In addition, all executive officers have agreed to be bound by non-competition restrictions set forth in their agreements during the term of employment.

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        We have entered into indemnification agreements with each of our directors and executive officers, under which we agree to indemnify them against certain liabilities and expenses they may incur in connection with claims made by reason of their being our directors or executive officers.

Board of Directors

        Our Board of Directors currently consists of eight directors and will consist of seven directors upon completion of the offering following the effectiveness of Mr. Chui's resignation. Under our memorandum and articles of association and shareholders agreement currently in effect, we have provided rights to certain of our shareholders to appoint directors to our Board of Directors. Our founders have the right to appoint three of our directors, initially being Guosheng Qi, Guofa Yu and Yanchun Bai. The holders of a majority of our outstanding Series A preferred shares have the right to appoint one director, initially being Perry Lin Chui, the holders of a majority of our outstanding Series B preferred shares have the right to appoint one director, which seat is currently vacant, and Broad Street Investments Holding (Singapore) Pte. Ltd. and its affiliated entities have the right to appoint one director, initially being Xiang Fan. The rights granted to our existing shareholders to appoint directors will terminate upon the completion of this offering.

        Under Cayman Islands law, a director is not required to hold any shares in the company to qualify to serve as a director. A director may vote in respect of any contract or transaction in which he or she is interested, provided that the director shall disclose the nature of his or her interest in such contract or transaction at or prior to its consideration and any vote thereon. Our Board of Directors may exercise all the powers of our company to borrow money and to mortgage or charge its undertaking, property and uncalled capital or any part thereof, and to issue debentures whether outright or as security for any debt, liability or obligation of our company or of any third party.

Committees of the Board of Directors

        We have established three committees of the Board of Directors effective upon the completion of this offering. The committees are the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. We have adopted a charter for each of these committees, which will become effective upon the completion of this offering. We are relying on home country practices whereby our Compensation Committee and Nominating and Corporate Governance Committee need not consist of all independent directors. Each committee's members and functions are described below:

Audit Committee

        The members of our Audit Committee will consist of Mr. Gao, Mr. Melcher and Mr. Schloss, and will be chaired by Mr. Schloss. We have determined that each of Mr. Gao, Mr. Melcher and Mr. Schloss satisfies the independence requirements of the NASDAQ Stock Market and Rule 10A-3 under the Exchange Act. Mr. Schloss meets the criteria of an audit committee financial expert as set forth under the applicable rules of the SEC.

        The Audit Committee oversees our accounting and financial reporting processes and the audits of the financial statements of our company. It will be responsible for, among other things:

•

appointing the independent auditor and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditor;

•

reviewing with the independent auditor any audit problems or difficulties and management's response;

•

reviewing and approving all proposed related party transactions;

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•

reviewing and discussing audited annual financial statements with management and the independent auditor;

•

reviewing major issues as to the adequacy of our internal controls and any special audit steps adopted in light of material control deficiencies;

•

annually reviewing and reassessing the adequacy of our Audit Committee charter;

•

meeting separately and periodically with management and the independent auditor; and

•

reporting regularly to the Board of Directors.

Compensation Committee

        Our Compensation Committee will consist of Mr. Gao, Mr. Qi and Mr. Schloss, and will be chaired by Mr. Gao. We have determined that each of Mr. Gao and Mr. Schloss satisfies the independence requirements of the NASDAQ Stock Market for compensation committee members set forth in Rule 5605(d)(2)(A). Mr. Qi will not serve on our Compensation Committee for longer than two years.

        The Compensation Committee will assist the Board of Directors in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. Mr. Qi may not be present at any committee meeting during which his compensation is deliberated. The Compensation Committee will be responsible for, among other things:

•

reviewing and approving, or recommending to the Board of Directors for its approval, the compensation of our chief executive officer and other executive officers;

•

reviewing and approving, or recommending to the Board of Directors for its approval, the compensation of our directors; and

•

reviewing periodically and making recommendations to the Board of Directors regarding any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, employee pension and welfare benefit plans; and

•

selecting compensation consultant, legal counsel or other adviser for the committee after taking into consideration all factors relevant to that person's independence from management.

Nominating and Corporate Governance Committee

        Our Nominating and Corporate Governance Committee will consist of Mr. Gao, Mr. Melcher and Mr. Qi, and will be chaired by Mr. Melcher. We have determined that each of Mr. Gao and Mr. Melcher satisfies the independence requirements of the NASDAQ Stock Market. The Nominating and Corporate Governance Committee assists the Board of Directors in selecting individuals qualified to serve on the Board of Directors and in determining the composition of the Board of Directors and its committees. The Nominating and Corporate Governance Committee is responsible for, among other things:

•

identifying and recommending to the Board nominees for election by the shareholders or appointment by the Board of Directors;

•

reviewing annually with the Board of Directors the current composition of the Board of Directors with regard to characteristics such as independence, knowledge, skills, experience and diversity;

•

making recommendations on the frequency and structure of Board of Directors meetings and monitoring the functioning of Board of Directors committees; and

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•

advising the Board of Directors periodically about significant developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations and making recommendations to the Board of Directors on all matters of corporate governance.

Duties of Directors

        Under Cayman Islands law, our directors have a fiduciary duty to act honestly in good faith with a view to our best interests. Our directors also have a duty to exercise the skill they actually possess and such care and diligence that a reasonably prudent person would exercise in comparable circumstances. In fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association. A shareholder may have the right to seek damages if a duty owed by our directors is breached. You should refer to "Description of Share Capital—Differences in Corporate Law" for additional information on our standard of corporate governance under Cayman Islands law.

Terms of Directors and Officers

        Our officers are elected by and serve at the discretion of the Board of Directors. Our directors are not subject to a term of office and hold office until such time as they resign or are removed from office by a special resolution of our shareholders. A director will be removed from office automatically if, among other things, the director becomes bankrupt or makes any arrangement or composition with his creditors generally, or dies or is found by our company to be of unsound mind.

Compensation of Directors and Executive Officers

        For 2015, we paid an aggregate of approximately RMB10.8 million (US$1.6 million) in cash to our executive officers, and we did not pay any cash compensation to our non-executive directors. Our PRC subsidiary and consolidated affiliated entities are required by law to make contributions equal to certain percentages of each employee's salary for his or her pension insurance, medical insurance, housing fund, unemployment and other statutory benefits. We have no service contract with any of our directors providing for benefits upon termination of employment. For details on the share incentive grants to our executive officers and directors, see "—Share Incentive Plans."

Share Incentive Plans

2014 Stock Option Plan

        In 2014, we amended our stock option plan, which we originally adopted in 2011. This plan, which we refer to as the 2014 Plan, is intended to promote our success and shareholder value by attracting, motivating and retaining selected employees and other eligible participants through awards of stock options.

        As of the date of this prospectus, there are 2,468,661 Class B ordinary shares issuable upon the exercise of outstanding options and 31,339 Class B ordinary shares reserved for future issuance under the 2014 Plan. Shares underlying stock options that are forfeited, canceled, or that otherwise expire, and shares issued upon the exercise of stock options that are repurchased at the lower of cost or the then current fair market value are not considered to have been issued under the 2014 Plan. To the extent permitted by applicable listing requirements and applicable law, shares surrendered to pay a stock option's exercise price and any tax withholding obligations will also be deemed not to have been issued under the 2014 Plan, except as determined otherwise by the Board of Directors or Compensation Committee.

        While the 2014 Plan is scheduled to expire on the fifth anniversary of its adoption, no further equity grants will be made under the 2014 Plan following the completion of this offering; instead, awards will be granted under a successor equity plan, our 2016 Equity Incentive Plan.

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        Eligibility.    The 2014 Plan provides for the grant of stock options to our employees or employees of related entities, such as a parent or subsidiary corporation.

        Administration.    Subject to the terms of the 2014 Plan, either our Board of Directors or the Compensation Committee has the discretion to make all decisions implementing the 2014 Plan.

        Stock Options.    Stock options are granted pursuant to stock option agreements. The 2014 Plan allows our Board of Directors or Compensation Committee to establish a deferral program whereby an optionee may defer the amount of consideration to be received pursuant to a stock option.

        Vesting Schedule.    In general, the Board of Directors or Compensation Committee determines the purchase price and the vesting and exercise schedule, which are set forth in the option agreement with each optionee.

        Compliance with Law.    An option may not be exercised and shares issued unless the exercise complies with all applicable laws.

        Transferability.    Unless our Board of Directors or Compensation Committee permits otherwise, stock options may not be transferred, except by will or by the laws of descent or distribution.

        Changes to Capitalization.    In the event that there is a specified type of change in our capital structure not involving the receipt of consideration by us, the 2014 Plan provides for the proportional adjustment of the number of shares reserved under the 2014 Plan and the number of shares and exercise or purchase price, if applicable, of all outstanding options.

        Change in Control Transactions.    Unless otherwise provided in the option agreement or provided by the Board of Directors or Compensation Committee, in the event of certain change in control transactions, any or all outstanding stock options under the 2014 Plan may be assumed or replaced by any surviving entity or will otherwise terminate without vesting acceleration.

        Additional Provisions.    Our Board of Directors has the authority to amend, alter, suspend or terminate the 2014 Plan. However, no amendment or termination of the plan may adversely affect any rights under awards already granted to a participant without the affected participant's consent and certain changes may require shareholder approval.

2016 Equity Incentive Plan

        We adopted a 2016 Equity Incentive Plan, or the 2016 Plan, that will become effective on the date immediately prior to the date of this prospectus. We have reserved 2,500,000 Class B ordinary shares to be issued under our 2016 Plan. The number of shares reserved for issuance under our 2016 Plan will increase automatically on January 1 of each of 2017 through 2026 by the number of shares equal to 2.5% of the aggregate number of outstanding Class B ordinary shares as of the immediately preceding December 31. However, our Board of Directors may reduce the amount of the increase in any particular year. In addition, the following Class B ordinary shares will again be available for grant and issuance under our 2016 Plan:

•

ordinary shares subject to options or share appreciation rights granted under our 2016 Plan that cease to be subject to the option or stock appreciation right for any reason other than exercise of the option or share appreciation right;

•

ordinary shares subject to awards granted under our 2016 Plan that are subsequently forfeited or repurchased by us at the original issue price;

•

ordinary shares subject to awards granted under our 2016 Plan that otherwise terminate without ordinary shares being issued;

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•

ordinary shares surrendered, cancelled or exchanged for cash or a different award (or combination thereof);

•

ordinary shares issuable upon the exercise of options or subject to other awards under our 2014 Plan prior to the date of this prospectus that cease to be subject to such options or other awards by forfeiture or otherwise after the date of this prospectus;

•

ordinary shares issued under our 2014 Plan prior to the date of this prospectus that are forfeited or repurchased by us after the date of this prospectus; and

•

ordinary shares subject to awards under our 2014 Plan that are used to pay the exercise price of an option or withheld to satisfy the tax withholding obligations related to any award.

        Shares that otherwise become available for grant and issuance because of the provisions above will not include shares subject to awards that initially became available due to our substitution of outstanding awards granted by another company in an acquisition of that company or otherwise.

        Eligibility.    The 2016 Plan provides for the grant of incentive stock options to our employees and any parent and subsidiary corporations' employees and for the grant of nonqualified share options, restricted shares, restricted share units, share appreciation rights, share bonuses and performance awards to our employees, directors and consultants and our parent and subsidiary corporations' employees and consultants. No more than 5,000,000 shares may be issued as incentive stock options under the 2016 Plan.

        Administration.    The 2016 Plan will be administered by the Board of Directors or by our Compensation Committee; in this plan description we refer to the Board of Directors or Compensation Committee as the plan administrator. The plan administrator determines the terms of all awards.

        Types of Awards.    The 2016 Plan will allow for the grant of options, restricted shares, restricted share units, share appreciation rights, share bonuses and performance awards.

        Award Agreements.    All awards under the 2016 Plan will be evidenced by an award agreement which shall set forth the number of ordinary shares subject to the award and terms and conditions of the award, which shall be consistent with the 2016 Plan.

        Term of Awards.    The term of awards granted under the 2016 Plan shall not exceed ten years from the date of grant. Subject to the foregoing, the plan administrator will be authorized to extend the term of any outstanding award.

        Vesting Schedule and Price.    The plan administrator will have sole discretion in setting the vesting period and, if applicable, exercise schedule of an award, determining that an award may not vest for a specified period after it is granted and accelerating the vesting period of an award. The plan administrator determines the exercise or purchase price of each award, to the extent applicable.

        Transferability.    Unless the plan administrator provides otherwise, the 2016 Plan does not allow for the transfer of awards other than by will or the laws of descent and distribution. Unless otherwise permitted by the plan administrator, options may be exercised during the lifetime of the optionee only by the optionee or the optionee's guardian or legal representative.

        Changes in Capitalization.    In the event there is a specified type of change in our capital structure without our receipt of consideration, such as a share split, or if required by applicable law, appropriate adjustments will be made to the share maximums and exercise prices, as applicable, of outstanding awards under the 2016 Plan.

        Change in Control Transactions.    In the event of specified types of mergers or consolidations, a sale, lease, or other disposition of all or substantially all of our assets or a corporate transaction,

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outstanding awards under our 2016 Plan may be assumed or replaced by any surviving or acquiring corporation; the surviving or acquiring corporation may substitute similar awards for those outstanding under our 2016 Plan; outstanding awards may be settled for the full value of such outstanding award (whether or not then vested or exercisable) in cash, cash equivalents, or securities (or a combination thereof) of the successor entity with payment deferred until the date or dates the award would have become exercisable or vested; or outstanding awards may be terminated for no consideration. The plan administrator, may, on a discretionary basis, accelerate, in full or in part, the vesting and exercisability of the awards.

        Compliance with Law.    Ordinary shares will not be issued under an award unless the issuance is permitted by applicable law.

        Amendment and Termination.    Our 2016 Plan will terminate ten years from the date it is adopted by our Board of Directors, unless it is terminated earlier by our Board of Directors. Our Board of Directors may amend or terminate our 2016 Plan at any time. Our Board of Directors generally may amend our 2016 Plan, without stockholder approval unless required by applicable law.

        The following table summarizes outstanding options held by our executive officers and directors under the 2014 Plan as of the date of this prospectus. No awards are currently outstanding under our 2016 Plan.

Name	Class B Ordinary Shares Underlying Options Awarded		Exercise Price (US$/Share)		Date of Grant	Date of Expiration
Guosheng Qi		937,500		0.42	December 1, 2012	December 1, 2022
Xudong Gao		*		0.42	January 1, 2011	January 1, 2021
		*		0.42	July 1, 2011	July 1, 2021
Yanchun Bai		*		0.42	September 1, 2012	September 1, 2022
		*		0.42	September 1, 2013	September 1, 2023
Michael Peng Zhang		*		0.42	February 10, 2014	February 10, 2024
John Jiyang Liu		*		0.42	December 10, 2014	December 10, 2024
Xin Wang		*		0.42	October 16, 2015	October 16, 2025

*

The aggregate number of Class B ordinary shares underlying the outstanding options held by this individual is less than 1% of our total outstanding ordinary shares.

        As of the date of this prospectus, other employees as a group hold outstanding options to purchase 795,875 Class B ordinary shares, with a weighted average exercise price of US$0.42 per ordinary share.

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PRINCIPAL SHAREHOLDERS

        The following table sets forth information concerning the beneficial ownership of our ordinary shares, as of the date of this prospectus, by:

•

each of our directors and executive officers; and

•

each person known to us to beneficially own more than 5% of our ordinary shares.

        Beneficial ownership is determined in accordance with the rules and regulations of the SEC. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, we have included shares that the person has the right to acquire within 60 days of the date of this prospectus. These shares, however, are not included in the computation of the percentage ownership of any other person.

        The calculations in the table below are based on 4,543,461 Class A ordinary shares and 17,486,705 Class B ordinary shares outstanding as of the date of this prospectus, assuming the conversion of all outstanding preferred shares into 12,030,166 Class B ordinary shares immediately upon the completion of this offering. We have also assumed that we will issue              shares of Class B ordinary shares in this offering.

	Ordinary Shares Beneficially Owned Prior to this Offering										Ordinary Shares Beneficially Owned After this Offering
	Class A				Class B				% Voting Power Before this Offering(2)		Class A				Class B		% Voting Power After this Offering(3)
	Shares		%		Shares		%				Shares		%		Shares	%
Directors and Executive Officers:(1)
Guosheng Qi(4)		4,543,461		100.0		4,461,939		24.3		49.3		4,543,461		100.0
Guofa Yu(5)		—		—		1,393,038		8.0		5.2		—		—
Perry Lin Chui(6)		—		—		3,470,052		19.8		13.1		—		—
Xiang Fan(7)		—		—		2,209,925		12.6		8.3		—		—
Yanchun Bai		—		—		*		*		*		—		—
Xudong Gao		—		—		*		*		*		—		—
Thomas A. Melcher		—		—		—		—		—		—		—
Peter Andrew Schloss		—		—		—		—		—		—		—
Michael Peng Zhang		—		—		*		*		*		—		—
John Liu		—		—		*		*		*		—		—
Aaron Feng Li(8)		—		—		1,200,000		6.9		4.5		—		—
Michael Yang Xu(9)		—		—		515,000		2.9		1.9		—		—
Xin Wang		—		—		*		*		*		—		—
All directors and executive officers as a group (13 persons)		4,543,461		100.0		12,059,555		63.8		75.5		4,543,461		100.0
Principal Shareholders:
Generation Gospel Limited(4)(10)		4,543,461		100.0		898,438		4.9		34.2		4,543,461		100.0
Garden Enterprises Ltd.(5)(11)		—		—		1,393,038		8.0		5.2		—		—
Fairy Spirit Limited(4)(12)		—		—		3,563,501		20.4		13.4		—		—
Steamboat Ventures Asia, L.P.(13)		—		—		3,470,052		19.8		13.1		—		—
Quantum Strategic Partners Ltd.(14)		—		—		2,024,197		11.6		7.6		—		—
Broad Street Investments Holding (Singapore) Pte. Ltd. and its affiliated entities(15)		—		—		2,209,925		12.6		8.3		—		—

*

Represents less than 1%.

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(1)

The business address of our directors and executive officers is Jade Palace Hotel Office Building, 8th Floor, 76 Zhichun Road, Haidian District, Beijing, People's Republic of China.

(2)

For each person or group included in this column, the percentage of total voting power represents voting power based on all ordinary shares beneficially owned by such person or group. Each holder of Class A ordinary shares prior to this offering is entitled to two votes per share, and each holder of Class B ordinary shares is entitled to one vote per share, on all matters subject to a shareholders' vote. Our Class A ordinary shares are convertible at any time by the holder into Class B ordinary shares on a one-for-one basis, whereas Class B ordinary shares are not convertible into Class A ordinary shares under any circumstances.

(3)

For each person or group included in this column, the percentage of total voting power represents voting power based on all ordinary shares beneficially owned by such person or group immediately after completion of this offering. Each holder of Class A ordinary shares upon completion of this offering will be entitled to ten votes per share, and each holder of Class B ordinary shares will be entitled to one vote per share, on all matters subject to a shareholders' vote. Our Class A ordinary shares are convertible at any time by the holder into Class B ordinary shares on a one-for-one basis, whereas Class B ordinary shares are not convertible into Class A ordinary shares under any circumstances.

(4)

Represents (i) 4,543,461 Class A ordinary shares held by Generation Gospel Limited, as described in footnote (10) below; (ii) 3,563,501 Class B ordinary shares held by Fairy Spirit Limited, as described in footnote (12) below; and (iii) 898,438 Class B ordinary shares that Generation Gospel Limited is entitled to acquire upon exercise of options held by it under the 2014 Plan.

(5)

Represents 1,393,038 Class B ordinary shares held by Garden Enterprises Ltd., as described in footnote (11) below.

(6)

Mr. Chui was appointed by Steamboat Ventures Asia, L.P. See footnote (13) below.

(7)

Mr. Fan was appointed by Broad Street Investments Holding (Singapore) Pte. Ltd. and its affiliated entities. See footnote (15) below.

(8)

Represents 1,200,000 Class B ordinary shares beneficially owned by Mr. Li through Fairy Spirit Limited, as described in footnote (12) below.

(9)

Represents 515,000 Class B ordinary shares beneficially owned by Mr. Xu through Fairy Spirit Limited, as described in footnote (12) below.

(10)

Represents (i) 4,543,461 Class A ordinary shares; and (ii) 898,438 Class B ordinary shares that Generation Gospel Limited is entitled to acquire upon exercise of options held by it under the 2014 Plan. Generation Gospel Limited, a British Virgin Islands company, is wholly owned by Guosheng Qi, our chief executive officer and chairman. The registered address of Generation Gospel Limited is Geneva Place, Waterfront Drive, P.O. Box 3469, Road Town, Tortola, British Virgin Islands.

(11)

Represents 1,393,038 Class B ordinary shares. Garden Enterprises Ltd., a British Virgin Islands company, is wholly owned by Guofa Yu, our director and chief operating officer. The registered address of Garden Enterprises Ltd. is Geneva Place, Waterfront Drive, PO Box 3469, Road Town, Tortola, British Virgin Islands.

(12)

Fairy Spirit Limited, a British Virgin Islands company, is owned by certain key employees of our company, including Aaron Feng Li and Michael Yang Xu, and controlled by Guosheng Qi, our chief executive officer and chairman. The registered address of Fairy Spirit Limited is Geneva Place, Waterfront Drive, P.O. Box 3469, Road Town, Tortola, British Virgin Islands.

(13)

Represents (i) 3,125,000 Class B ordinary shares issuable upon conversion of 3,125,000 Series A preferred shares, (ii) 260,417 Class B ordinary shares issuable upon conversion of 260,417 Series A-1 preferred shares and (iii) 84,635 Class B ordinary shares issuable upon conversion of 84,635 Series B preferred shares. The general partner of Steamboat Ventures Asia, L.P. is Steamboat Ventures Asia Managers, L.P. The general partner of Steamboat Ventures Asia Managers, L.P. is Steamboat Ventures Asia GP, Ltd., which is ultimately controlled by John R. Ball and Liping Fan. The registered address of Steamboat Ventures Asia, L.P. is Campbell's Corporate Services Limited, 4/F, Willow House, Cricket Square, P.O. Box 268, Grand Cayman KY1-1104, Cayman Islands.

(14)

Represents (i) 1,692,708 Class B ordinary shares issuable upon conversion of 1,692,708 Series B preferred shares and (ii) 331,489 Class B ordinary shares issuable upon conversion of 331,489 Series C preferred shares held for the account of Quantum Strategic Partners Ltd., or Quantum. Soros Fund Management LLC, or SFM LLC, together with its wholly owned subsidiary SFM HK Management Limited, collectively, SFM, serves

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as principal investment manager to Quantum with respect to such shares held by Quantum. As such, SFM has been granted investment discretion over portfolio investments, including such shares, held for the account of Quantum. George Soros serves as Chairman of SFM LLC and Robert Soros serves as President and Deputy Chairman of SFM LLC. The business address for SFM LLC is 250 West 55th Street, 38th Floor, New York, New York 10019.

(15)

Represents (i) 1,657,444 Class B ordinary shares issuable upon conversion of 1,657,444 Series C preferred shares held by Broad Street Investments Holding (Singapore) Pte. Ltd., (ii) 258,332 Class B ordinary shares issuable upon conversion of 258,332 Series C preferred shares held by Bridge Street 2015, L.P., (iii) 66,539 Class B ordinary shares issuable upon conversion of 66,539 Series C preferred shares held by MBD 2015, L.P., (iv) 75,377 Class B ordinary shares issuable upon conversion of 75,377 Series C preferred shares held by Stone Street 2015, L.P. and (v) 152,233 Class B ordinary shares issuable upon conversion of 152,233 Series C preferred shares held by 2015 Employee Offshore Aggregator, L.P. These entities are indirect wholly owned subsidiaries of Goldman Sachs Group, Inc. The registered address of Broad Street Investments Holding (Singapore) Pte. Ltd. is 1 Raffles Link, #07-01, One Raffles Link, Singapore (039393). The registered address of Bridge Street 2015, L.P., MBD 2015, L.P. and Stone Street 2015, L.P. is Corporate Trust Center, 1209 Orange Street, Wilmington, New Castle County, Delaware 19801. The registered address of 2015 Employee Offshore Aggregator, L.P. is P.O. Box 309, Ugland House, Grand Cayman, KY 1-1104, Cayman Islands.

        As of the date of this prospectus, five shareholders in the United States hold an aggregate of 1,941,915 Class B ordinary shares. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. See "Description of Share Capital—History of Securities Issuances" for a description of issuances of our ordinary shares and preferred shares that have resulted in significant changes in ownership held by our major shareholders.

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RELATED PARTY TRANSACTIONS

Contractual Arrangements

        See "Corporate History and Structure" for a description of the contractual arrangements between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding.

Private Placements

        See "Description of Share Capital—History of Securities Issuances."

Shareholders Agreement

        On June 30, 2015, we entered into a second amended and restated shareholders agreement with the holders of our Class A ordinary shares, Class B ordinary shares, Series A preferred shares, Series B preferred shares and Series C preferred shares. Under the shareholders agreement, holders of our preferred shares have registration rights, including demand registration rights, Form F-3 registration rights and piggyback registration rights, as described under "Description of Share Capital—Registration Rights." The shareholders agreement also provides for the composition of our Board of Directors, which are described under "Management—Board of Directors." Under the shareholders agreement, holders of our preferred shares are granted other rights, including information and inspection rights, preemptive rights, rights of first offer, rights of co-sale, drag-along rights and protective provisions on certain corporate matters.

        All of the rights provided to our preferred shareholders under the shareholders agreement, except for registration rights, will automatically terminate upon the completion of this offering.

Loan Guarantee

        In December 2014, Beijing Moment, one of our consolidated affiliated entities, entered into a short-term guaranteed loan arrangement with China Merchants Bank for a non-revolving credit facility amounting to RMB4.0 million (US$0.6 million). A guarantee was provided by Guosheng Qi, our chief executive officer and chairman. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Cash and Cash Equivalents." The short-term loan was repaid in December 2015.

        In June 2016, Beijing Gridsum, one of our consolidated affiliated entities, entered into a short-term guaranteed revolving credit facility with China Merchants Bank with maximum amount of RMB25.0 million (US$3.8 million), a fixed interest rate of 5.44% per annum and a term of twelve months. The guarantee was provided by our chief executive officer and chairman, and Beijing Moment. As of June 30, 2016, we borrowed RMB10.0 million (US$1.5 million) under this credit facility.

Employment Agreements

        See "Management—Employment Agreements and Indemnification Agreements."

Share Incentives

        See "Management—Share Incentive Plans."

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DESCRIPTION OF SHARE CAPITAL

        We are a Cayman Islands exempted company with limited liability and our affairs are governed by our memorandum and articles of association and the Companies Law (2013 Revision) of the Cayman Islands, or Companies Law.

        As of the date of this prospectus, our authorized share capital consists of US$50,000 divided into (i) 37,969,834 ordinary shares of par value US$0.001 per share, of which 4,543,461 are designated as Class A ordinary shares and 33,426,373 are designated as Class B ordinary shares; and (ii) 12,030,166 preferred shares of par value US$0.001 per share, of which 3,125,000 are designated as Series A preferred shares, 1,302,084 are designated as Series A-1 preferred shares, 2,962,239 are designated as Series B preferred shares and 4,640,843 are designated as Series C preferred shares. As of the date of this prospectus, there are 4,543,461 Class A ordinary shares, 5,456,539 Class B ordinary shares, 3,125,000 Series A preferred shares, 1,302,084 Series A-1 preferred shares, 2,962,239 Series B preferred shares and 4,640,843 Series C preferred shares issued and outstanding in accordance with our register of members. All of the issued and outstanding preferred shares will automatically convert into 12,030,166 Class B ordinary shares immediately upon the completion of this offering.

        We have adopted a fifth amended and restated memorandum and articles of association which will become effective upon completion of this offering and will replace our pre-offering fourth amended and restated memorandum and articles of association in its entirety. The following are summaries of material provisions of our fifth amended and restated memorandum and articles of association and the Companies Law insofar as they relate to the material terms of our ordinary shares.

        The following discussion primarily concerns ordinary shares and the rights of holders of ordinary shares. The holders of ADSs will not be treated as our shareholders and will be required to surrender their ADSs for cancellation and withdrawal from the depositary facility in which the ordinary shares are held in order to exercise shareholders' rights with respect to the ordinary shares. The depositary will agree, so far as it is practical, to vote or cause to be voted the amount of ordinary shares represented by ADSs in accordance with the non-discretionary written instructions of the holders of such ADSs. See "Description of American Depositary Shares."

Ordinary Shares

General

        Upon the completion of this offering, our authorized share capital will be US$200,000 divided into 200,000,000 ordinary shares, par value of US$0.001 per share, which will be divided into 20,000,000 Class A ordinary shares, par value of US$0.001 per share, and 180,000,000 Class B ordinary shares, par value of US$0.001 per share. Holders of Class A ordinary shares and Class B ordinary shares have the same rights except for voting and conversion rights. All of our outstanding ordinary shares are fully paid up and non-assessable. Certificates representing the ordinary shares are issued in registered form. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their shares.

Dividends

        The holders of our ordinary shares are entitled to such dividends as may be declared by our Board of Directors. Holders of Class A ordinary shares and Class B ordinary shares will be entitled to the same amount of dividends, if declared.

Voting Rights

        In respect of all matters subject to a shareholders' vote, each Class A ordinary share upon completion of this offering will be entitled to ten votes, and each Class B ordinary share will be entitled

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to one vote, voting together as one class. Voting at any shareholders' meeting is by show of hands unless a poll is demanded. A poll may be demanded by the chairman or any shareholder(s) present in person or by proxy holding at least 10% of the voting share capital of our company. Actions that may be taken at a general meeting may also be taken by a unanimous resolution of the shareholders in writing.

        A quorum of shareholders for a general meeting consists of the holders of at least 50% of the aggregate voting power of all outstanding ordinary shares, being entitled to vote, attend and vote at the general meeting. An ordinary resolution to be passed at a general meeting requires the affirmative vote of a simple majority of the votes cast, while a special resolution requires the affirmative vote of at least two-thirds of votes cast at a general meeting. A special resolution will be required for important matters.

Conversion

        Each Class A ordinary share is convertible into one Class B ordinary share at any time by the holder thereof. Class B ordinary shares are not convertible into Class A ordinary shares under any circumstances. Upon any transfer of Class A ordinary shares by the holder or beneficial owner thereof to any person that is not affiliated with such holder or beneficial owner, such Class A ordinary shares will be automatically and immediately converted into an equal number of Class B ordinary shares.

Transfer of Ordinary Shares

        Subject to the restrictions set out below, any of our shareholders may transfer all or any of his or her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our Board of Directors.

        Our Board of Directors may, in its sole discretion, decline to register any transfer of any ordinary share which is not fully paid up or on which we have a lien. Our directors may also decline to register any transfer of any ordinary share unless (a) the instrument of transfer is lodged with us, accompanied by the certificate for the ordinary shares to which it relates and such other evidence as our Board of Directors may reasonably require to show the right of the transferor to make the transfer; (b) the instrument of transfer is in respect of only one class of ordinary shares; (c) the instrument of transfer is properly stamped, if required; (d) in the case of a transfer to joint holders, the number of joint holders to whom the ordinary share is to be transferred does not exceed four; and (e) any fee related to the transfer has been paid to us.

        If our directors refuse to register a transfer, they shall, within three months after the date on which the instrument of transfer was lodged, send to each of the transferor and the transferee notice of such refusal.

        The registration of transfers may, with 14 days' prior notice, be suspended and the register closed at such times and for such periods as our Board of Directors may from time to time determine, provided, however, that the registration of transfers shall not be suspended nor the register closed for more than 30 days in any year.

Liquidation

        On a return of capital on winding up or otherwise (other than on conversion, redemption or purchase of shares), assets available for distribution among the holders of ordinary shares shall be distributed among the holders of the ordinary shares on a pro rata basis. If our assets available for distribution are insufficient to repay all of the paid up capital, the assets will be distributed so that the losses are borne by our shareholders proportionately.

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Calls on Ordinary Shares and Forfeiture of Ordinary Shares

        Our Board of Directors may from time to time make calls upon shareholders for any amounts unpaid on their ordinary shares in a notice served to such shareholders at least 14 days prior to the specified time and place of payment. The shares that have been called upon and remain unpaid on the specified time are subject to forfeiture.

Redemption of Shares

        We may issue shares on terms that are subject to redemption, at our option or at the option of the holders, on such terms and in such manner as may be determined by our Board of Directors.

Variations of Rights of Shares

        All or any of the special rights attached to any class of shares may, be varied with the sanction of a special resolution passed at a general meeting of the holders of the shares of that class. Consequently, the rights of any class of shares cannot be altered without a majority of two-thirds of the votes cast at such meeting.

Inspection of Books and Records

        Holders of our ordinary shares will have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or our corporate records. However, we will provide our shareholders with annual audited financial statements. See "Where You Can Find Additional Information."

Issuance of Additional Shares

        Our fifth amended and restated memorandum and articles of association authorizes our Board of Directors to issue additional ordinary shares from time to time as our Board of Directors shall determine, to the extent of available authorized but unissued shares.

        Our fifth amended and restated memorandum and articles of association also authorizes our Board of Directors to establish from time to time one or more series of preferred shares and to determine, with respect to any series of preferred shares, the terms and rights of that series, including:

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the designation of the series;

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the number of shares of the series;

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the dividend rights, dividend rates, conversion rights, voting rights; and

•

the rights and terms of redemption and liquidation preferences.

        Our Board of Directors may issue preferred shares without action by our shareholders to the extent authorized but unissued. Issuance of these shares may dilute the voting power of holders of ordinary shares.

History of Securities Issuances

        The following is a summary of our securities issuances and re-designations during the past three years.

Ordinary Shares

        On January 26, 2015, in connection with our Series C financing, we effected a re-designation of our ordinary shares. As a result, on January 26, 2015, 4,543,461 ordinary shares held by Generation

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Gospel Limited were re-designated as Class A ordinary shares, and all of the ordinary shares held by our existing shareholders other than Generation Gospel Limited prior to the re-designation were re-designated as Class B ordinary shares.

Preferred Shares

        On October 1, 2013, we issued a total of 2,962,239 Series B preferred shares, for a price per share of US$5.91 per share and an aggregate consideration of US$17.5 million, to the following entities:

Purchaser	Number of Series B Preferred Shares		Consideration in US$
Quantum Strategic Partners Ltd.		1,692,708		10,000,000
Rainbow Castle Holdings Limited		677,083		4,000,000
UVM 2 Venture Investments LP		507,813		3,000,000
Steamboat Ventures Asia, L.P.		84,635		499,998

        On January 30, 2015, we issued a total of 4,088,362 Series C preferred shares, for a price per share of US$9.05 per share and an aggregate consideration of US$37.0 million, to the following entities:

Purchaser	Number of Series C Preferred Shares		Consideration in US$
Broad Street Investments Holding (Singapore) Pte. Ltd.		1,657,444		15,000,000
ASEAN China Investment Fund II L.P.		773,474		7,000,000
VLTCM Ltd.		552,481		5,000,000
Quantum Strategic Partners Ltd.		331,489		3,000,000
PA Venture Opportunity VII Limited		441,985		4,000,000
Moon Capital Master Fund Ltd.		144,529		1,308,000
Moon Capital Partners Master Fund Ltd.		186,960		1,692,000

        On March 5, 2015, we issued a total of 552,481 Series C preferred shares, for a price per share of US$9.05 per share and an aggregate consideration of US$5.0 million, to the following entities:

Purchaser	Number of Series C Preferred Shares		Consideration in US$
Bridge Street 2015, L.P.		258,332		2,337,927
MBD 2015, L.P.		66,539		602,184
Stone Street 2015, L.P.		75,377		682,168
2015 Employee Offshore Aggregator, L.P.		152,233		1,377,722

Option Grants

        We have granted options to purchase our ordinary shares to certain of our directors, executive officers and employees. As of the date of this prospectus, the aggregate number of our ordinary shares underlying our outstanding options was 2,468,661. See "Management—Share Incentive Plans."

Registration Rights

        Pursuant to our second amended and restated shareholders' agreement dated June 30, 2015, we have granted certain registration rights to holders of our registrable securities, which include our ordinary shares issued or issuable upon conversion of preferred shares, ordinary shares owned or acquired by the holders of our preferred shares, and ordinary shares issued as a dividend or

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distribution of, in exchange for, or in replacement of, the ordinary shares mentioned above. Set forth below is a description of the registration rights granted under the agreement.

Demand Registration Rights

        At any time after the earlier of January 30, 2017 or six months after the completion of this offering, holders of at least 25% of then outstanding registrable securities have the right to demand in writing that we file a registration statement covering the offer and sale of their securities. We, however, are not obligated to effect more than two demand registrations, unless the sale of all registrable securities sought to be included in such registration is not consummated for reasons not attributable to the requesting holders.

Form F-3 or Form S-3 Registration Rights

        When we are eligible for registration on Form F-3 or Form S-3, any holder of our then outstanding registrable securities has the right to request that we file a registration statement under Form F-3. We, however, are not obligated to effect more than two registrations within any 12-month period pursuant to this registration right, unless the sale of all registrable securities sought to be included in such registration is not consummated for reasons not attributable to the requesting holders.

Deferral of Registration

        We are not obligated to effect the above demand registration or Form F-3 or Form S-3 registration, (i) if, within ten days of the receipt of any registration request, we give notice to the requesting holders of our intention to effect the filing for our own account of a registration statement of ordinary shares within 60 days of receipt of such request, and we are actively employing in good faith our best efforts to cause such registration statement to become effective within such 60-day period or (ii) during the period starting with the date of filing by us of, and ending six months following the effective date of, any registration statement pertaining to our ordinary shares, provided that in either case, the holders of registrable securities are entitled to join such registration subject to the piggyback registration rights described below. Furthermore, we have the right to defer filing of a registration statement for up to 90 days if we provide the requesting holders a certificate signed by our chief executive officer stating that in the good faith judgment of the Board of Directors that filing of a registration statement in the near future will be materially detrimental to us and our shareholders, but we cannot exercise the deferral right more than once in any 12-month period, nor can we register any other securities during the period the requested registration is deferred.

Piggyback Registration Rights

        If we propose to file a registration statement for a public offering of our equity securities, either for our own account or for the account of any shareholder other than a holder of registrable securities, other than, among other things, relating to the sale of securities to participates in our share plan or a corporate reorganization, then we must use our best efforts to include in the registration any registrable securities requested by their holder to be registered. The underwriters of any underwritten offering will have the right to limit the number of shares having registration rights to be included in the registration statement.

Expenses of Registration

        We will pay all expenses, other than underwriting discounts and commissions, relating to any demand, Form F-3 or Form S-3 or piggyback registration. We are not required to pay for any expenses of any registration proceeding begun in response to holders' exercise of their registration rights if the

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registration request is subsequently withdrawn at the request of the holders of a majority of the registrable securities to be registered.

Termination of Obligations

        The registration rights described above shall terminate on the earlier of (i) the date that is five years after the closing of this offering or (ii) with respect to any holder of registrable securities, the date on which such holder may sell all of such holder's registrable securities under Rule 144 of the Securities Act in any 90-day period without registration.

Exempted Company

        We are an exempted company with limited liability under the Companies Law. The Companies Law distinguishes between ordinary resident companies and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except that an exempted company:

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does not have to file an annual return of its shareholders with the Registrar of Companies;

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is not required to open its register of members for inspection;

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does not have to hold an annual general meeting;

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may issue negotiable or bearer shares or shares with no par value;

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may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance);

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may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;

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may register as a limited duration company; and

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may register as a segregated portfolio company.

        "Limited liability" means that the liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which a court may be prepared to pierce or lift the corporate veil).

Register of Members

        Under the Companies Law, we must keep a register of members and there should be entered therein: (i) the names and addresses of our members, a statement of the shares held by each member and of the amount paid or agreed to be considered as paid on the shares of each member; (ii) the date on which the name of any person was entered on the register as a member; and (iii) the date on which any person ceased to be a member.

        Under Cayman Islands law, the register of members of our company is prima facie evidence of the matters set out therein (i.e. the register of members will raise a presumption of fact on the matters referred to above unless rebutted) and a member registered in the register of members is deemed as a matter of Cayman Islands law to have legal title to the shares as set against its name in the register of members. Upon the completion of this offering, the register of members will be immediately updated to record and give effect to the issue of shares by us to the depositary (or its nominee) as the depositary. Once our register of members has been updated, the shareholders recorded in the register of members will be deemed to have legal title to the shares set against their name.

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        If the name of any person is incorrectly entered in or omitted from our register of members or if there is any default or unnecessary delay in entering on the register the fact of any person having ceased to be a member of our company, the person or member aggrieved (or any member of our company or our company itself) may apply to the Grand Court of the Cayman islands for an order that the register be rectified, and the Court may either refuse such application or it may, if satisfied of the justice of the case, make an order for the rectification of the register.

Differences in Corporate Law

        The Companies Law is derived, to a large extent, from the older Companies Acts of England but does not follow recent United Kingdom statutory enactments, and accordingly there are significant differences between the Companies Law and the current Companies Act of England. In addition, the Companies Law differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of the significant differences between the provisions of the Companies Law applicable to us and the laws applicable to companies incorporated in the United States and their shareholders.

Mergers and Similar Arrangements

        The Companies Law permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company and (b) a "consolidation" means the combination of two or more constituent companies into a combined company and the vesting of the undertaking, property and liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each constituent company and (b) such other authorization, if any, as may be specified in such constituent company's articles of association. The written plan of merger or consolidation must be filed with the Registrar of Companies together with a certificate of good standing, a declaration as to the solvency of the consolidated or surviving company and a further director declaration that the merger or consolidation is bona fide and covering such other matters as required by the Companies Law, including a list of the assets and liabilities of each constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Dissenting shareholders have the right to be paid the fair value of their shares (which, if not agreed between the parties, will be determined by the Cayman Islands court) if they follow the required procedures, subject to certain exceptions. Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.

        In addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement is approved by a majority in number of each class of shareholders or creditors with whom the arrangement is to be made, and who must in addition represent three-fourths in value of each such class of shareholders or creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:

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the statutory provisions as to the required majority vote have been met;

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the shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion of the minority to promote interests adverse to those of the class;

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the arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest; and

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the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Law.

        When a takeover offer is made and accepted by holders of 90% of the shares affected within four months, the offeror may, within a two-month period commencing on the expiration of such four month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed in the case of an offer which has been so approved unless there is evidence of fraud, bad faith or collusion.

        If an arrangement and reconstruction is thus approved, the dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of Delaware corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

Shareholders' Suits

        Generally legal proceedings can be originated in the Grand Court of the Cayman Islands. In principle, we will normally be the proper plaintiff to sue for a wrong done to us as a company and a derivative action may ordinarily not be brought by a minority shareholder. However, based on English authority, which would in all likelihood be of persuasive authority in the Cayman Islands, the Cayman Islands courts can be expected (and have had occasion) to follow and apply the common law principles (namely the rule in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against, or derivative actions in the name of, our company to challenge:

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an act which is illegal or ultra vires and is therefore incapable of ratification by the shareholders;

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an act which requires a resolution with a qualified or special majority which has not been obtained; and

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an act which constitutes a fraud against the minority where the wrongdoers are themselves in control of the company.

Indemnification of Directors and Executive Officers and Limitation of Liability

        Cayman Islands law does not limit the extent to which a company's memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our fifth amended and restated memorandum and articles of association require us to indemnify our officers and directors for losses, damages, costs and expenses incurred in their capacities as such unless such losses or damages arise from dishonesty, willful default or fraud of such directors or officers. This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation.

        In addition, we have entered into indemnification agreements with our directors and executive officers that provide such persons with additional indemnification beyond that provided in our fifth amended and restated memorandum and articles of association.

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        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Directors' Fiduciary Duties

        Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that a director acts in a manner he or she reasonably believes to be in the best interests of the corporation. He or she must not use his corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interest of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, the director must prove the procedural fairness of the transaction and that the transaction was of fair value to the corporation.

        As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he or she owes the following duties to the company—a duty to act in good faith in the best interests of the company, a duty not to make a personal profit based on his position as director (unless the company permits him to do so), a duty not to put himself in a position where the interests of the company conflict with his personal interest or his duty to a third party and a duty to exercise powers for the purpose for which such powers were intended. A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

Shareholder Action by Written Consent

        Under the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act by written consent by amendment to its certificate of incorporation. Cayman Islands law and our fifth amended and restated articles of association provide that shareholders may approve corporate matters by way of a unanimous written resolution signed by or on behalf of each shareholder who would have been entitled to vote on such matter at a general meeting without a meeting being held.

Shareholder Proposals

        Under the Delaware General Corporation Law, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided it complies with the notice provisions in the governing documents. A special meeting may be called by the Board of Directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.

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        Cayman Islands law provides shareholders with only limited rights to requisition a general meeting and does not provide shareholders with any right to put any proposal before a general meeting. However, these rights may be provided in a company's articles of association. Our fifth amended and restated articles of association allow our shareholders holding at least one-third of the aggregate voting power of our paid up share capital to requisition a general meeting. However, our fifth amended and restated articles of association do not provide our shareholders with any right to put proposal before a general meeting.

        As a Cayman Islands exempted company, we are not obliged by the Companies Law to call shareholders' annual general meetings. Our fifth amended memorandum and articles of association provide that we may (but are not obliged to) in each year hold a general meeting at such time and place as may be determined by our directors. We, however, will hold an annual shareholders' meeting during each fiscal year, as required by the rules of the NASDAQ Stock Market.

Cumulative Voting

        Under the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation's certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single director, which increases the shareholder's voting power with respect to electing such director. As permitted under Cayman Islands law, our fifth amended and restated articles of association do not provide for cumulative voting. As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.

Removal of Directors

        Under the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under our fifth amended and restated articles of association, directors may be removed with or without cause, by a special resolution of our shareholders.

Transactions with Interested Shareholders

        The Delaware General Corporation Law contains a business combination statute applicable to Delaware public corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging in certain business combinations with an "interested shareholder" for three years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target's outstanding voting shares within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the target's board of directors.

        Cayman Islands law has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does

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provide that such transactions must be entered into bona fide in the best interests of the company and for a proper purpose and not with the effect of constituting a fraud on the minority shareholders.

Dissolution; Winding Up

        Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation's outstanding shares. Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.

        Under Cayman Islands law, a company may be wound up by either an order of the courts of the Cayman Islands or by a special resolution of its members or, if the company is unable to pay its debts as they fall due, by an ordinary resolution of its members. The court has authority to order winding up in a number of specified circumstances including where it is, in the opinion of the court, just and equitable to do so. Under the Companies Law, our company may be dissolved, liquidated or wound up by a special resolution of our shareholders or by an ordinary resolution on the basis that our company is unable to pay its debts as they fall due.

Variation of Rights of Shares

        Under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under Cayman Islands law and our fifth amended and restated articles of association, the rights attached to any class or series of our shares may be varied with a special resolution passed at a general meeting of the holders of the shares of that class or series.

Amendment of Governing Documents

        Under the Delaware General Corporation Law, a corporation's certificate of incorporation may be amended only if adopted and declared advisable by the board of directors and approved by a majority of the outstanding shares entitled to vote, and the bylaws may be amended with the approval of a majority of the outstanding shares entitled to vote and may, if so provided in the certificate of incorporation, also be amended by the board of directors. Under the Companies Law, our memorandum and articles of association may only be amended by special resolution or the unanimous written resolution of all shareholders.

Rights of Non-resident or Foreign Shareholders

        There are no limitations imposed by our fifth amended and restated memorandum and articles of association on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions in our fifth amended and restated memorandum and articles of association governing the ownership threshold above which shareholder ownership must be disclosed.

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DESCRIPTION OF AMERICAN DEPOSITARY SHARES

        Citibank, N.A. has agreed to act as the depositary bank for the American Depositary Shares. Citibank's depositary offices are located at 388 Greenwich Street, New York, New York 10013. American Depositary Shares are frequently referred to as "ADSs" and represent ownership interests in securities that are on deposit with the depositary bank. ADSs may be represented by certificates that are commonly known as "American Depositary Receipts" or "ADRs." The depositary bank typically appoints a custodian to safekeep the securities on deposit. In this case, the custodian is Citibank, N.A.—Hong Kong, located 10/F, Harbour Front (II), 22, Tak Fung Street, Hung Hom, Kowloon, Hong Kong.

        We have appointed Citibank as depositary bank pursuant to a deposit agreement. A copy of the deposit agreement will be on file with the SEC under cover of a Registration Statement on Form F-6. You may obtain a copy of the deposit agreement from the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549 and from the SEC's website (www.sec.gov).

        We are providing you with a summary description of the material terms of the ADSs and of your material rights as an owner of ADSs. Please remember that summaries by their nature lack the precision of the information summarized and that the rights and obligations of an owner of ADSs will be determined by reference to the terms of the deposit agreement and not by this summary. We urge you to review the deposit agreement in its entirety. The portions of this summary description that are italicized describe matters that may be relevant to the ownership of ADSs but that may not be contained in the deposit agreement.

        Each ADS represents the right to receive, and to exercise the beneficial ownership interests in,         Class B ordinary shares that are on deposit with the depositary bank and/or custodian. An ADS also represents the right to receive, and to exercise the beneficial interests in, any other property received by the depositary bank or the custodian on behalf of the owner of the ADS but that has not been distributed to the owners of ADSs because of legal restrictions or practical considerations. We and the depositary bank may agree to change the ADS-to-share ratio by amending the deposit agreement. This amendment may give rise to, or change, the depositary fees payable by ADS owners. The custodian, the depositary bank and their respective nominees will hold all deposited property for the benefit of the holders and beneficial owners of ADSs. The deposited property does not constitute the proprietary assets of the depositary bank, the custodian or their nominees. Beneficial ownership in the deposited property will under the terms of the deposit agreement be vested in the beneficial owners of the ADSs. The depositary bank, the custodian and their respective nominees will be the record holders of the deposited property represented by the ADSs for the benefit of the holders and beneficial owners of the corresponding ADSs. A beneficial owner of ADSs may or may not be the holder of ADSs. Beneficial owners of ADSs will be able to receive, and to exercise beneficial ownership interests in, the deposited property only through the registered holders of the ADSs, the registered holders of the ADSs (on behalf of the applicable ADS owners) only through the depositary bank, and the depositary bank (on behalf of the owners of the corresponding ADSs) directly, or indirectly, through the custodian or their respective nominees, in each case upon the terms of the deposit agreement.

        If you become an owner of ADSs, you will become a party to the deposit agreement and therefore will be bound to its terms and to the terms of any ADR that represents your ADSs. The deposit agreement and the ADR specify our rights and obligations as well as your rights and obligations as owner of ADSs and those of the depositary bank. As an ADS holder you appoint the depositary bank to act on your behalf in certain circumstances. The deposit agreement and the ADRs are governed by New York law. However, our obligations to the holders of shares will continue to be governed by the laws of the Cayman Islands, which may be different from the laws in the United States.

        In addition, applicable laws and regulations may require you to satisfy reporting requirements and obtain regulatory approvals in certain circumstances. You are solely responsible for complying with such

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reporting requirements and obtaining such approvals. Neither the depositary bank, the custodian, us or any of their or our respective agents or affiliates shall be required to take any actions whatsoever on your behalf to satisfy such reporting requirements or obtain such regulatory approvals under applicable laws and regulations.

As an owner of ADSs, we will not treat you as one of our shareholders and you will not have direct shareholder rights. The depositary bank will hold on your behalf the shareholder rights attached to the shares underlying your ADSs. As an owner of ADSs you will be able to exercise the shareholders rights for the shares represented by your ADSs through the depositary bank only to the extent contemplated in the deposit agreement. To exercise any shareholder rights not contemplated in the deposit agreement you will, as an ADS owner, need to arrange for the cancellation of your ADSs and become a direct shareholder.

        As an owner of ADSs, you may hold your ADSs either by means of an ADR registered in your name, through a brokerage or safekeeping account, or through an account established by the depositary bank in your name reflecting the registration of uncertificated ADSs directly on the books of the depositary bank (commonly referred to as the "direct registration system" or "DRS"). The direct registration system reflects the uncertificated (book-entry) registration of ownership of ADSs by the depositary bank. Under the direct registration system, ownership of ADSs is evidenced by periodic statements issued by the depositary bank to the holders of the ADSs. The direct registration system includes automated transfers between the depositary bank and The Depository Trust Company ("DTC"), the central book-entry clearing and settlement system for equity securities in the United States. If you decide to hold your ADSs through your brokerage or safekeeping account, you must rely on the procedures of your broker or bank to assert your rights as ADS owner. Banks and brokers typically hold securities such as the ADSs through clearing and settlement systems such as DTC. The procedures of such clearing and settlement systems may limit your ability to exercise your rights as an owner of ADSs. Please consult with your broker or bank if you have any questions concerning these limitations and procedures. All ADSs held through DTC will be registered in the name of a nominee of DTC. This summary description assumes you have opted to own the ADSs directly by means of an ADS registered in your name and, as such, we will refer to you as the "holder." When we refer to "you," we assume the reader owns ADSs and will own ADSs at the relevant time.

        The registration of the shares in the name of the depositary bank or the custodian shall, to the maximum extent permitted by applicable law, vest in the depositary bank or the custodian the record ownership in the applicable shares with the beneficial ownership rights and interests in such shares being at all times vested with the beneficial owners of the ADSs representing the shares. The depositary bank or the custodian shall at all times be entitled to exercise the beneficial ownership rights in all deposited property, in each case only on behalf of the holders and beneficial owners of the ADSs representing the deposited property.

Dividends and Distributions

        As a holder of ADSs, you generally have the right to receive the distributions we make on the securities deposited with the custodian. Your receipt of these distributions may be limited, however, by practical considerations and legal limitations. Holders of ADSs will receive such distributions under the terms of the deposit agreement in proportion to the number of ADSs held as of the specified record date, after deduction the applicable fees, taxes and expenses.

Distributions of Cash

        Whenever we make a cash distribution for the securities on deposit with the custodian, we will deposit the funds with the custodian. Upon receipt of confirmation of the deposit of the requisite funds, the depositary bank will arrange for the funds to be converted into U.S. dollars and for the

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distribution of the U.S. dollars to the holders, subject to the laws and regulations of the Cayman Islands.

        The conversion into U.S. dollars will take place only if practicable and if the U.S. dollars are transferable to the United States. The depositary bank will apply the same method for distributing the proceeds of the sale of any property (such as undistributed rights) held by the custodian in respect of securities on deposit.

        The distribution of cash will be made net of the fees, expenses, taxes and governmental charges payable by holders under the terms of the deposit agreement. The depositary bank will hold any cash amounts it is unable to distribute in a non-interest bearing account for the benefit of the applicable holders and beneficial owners of ADSs until the distribution can be effected or the funds that the depositary bank holds must be escheated as unclaimed property in accordance with the laws of the relevant states of the United States.

Distributions of Class B Ordinary Shares

        Whenever we make a free distribution of shares for the securities on deposit with the custodian, we will deposit the applicable number of shares with the custodian. Upon receipt of confirmation of such deposit, the depositary bank will either distribute to holders new ADSs representing the shares deposited or modify the ADS-to-share ratio, in which case each ADS you hold will represent rights and interests in the additional shares so deposited. Only whole new ADSs will be distributed. Fractional entitlements will be sold and the proceeds of such sale will be distributed as in the case of a cash distribution.

        The distribution of new ADSs or the modification of the ADS-to-share ratio upon a distribution of shares will be made net of the fees, expenses, taxes and governmental charges payable by holders under the terms of the deposit agreement. In order to pay such taxes or governmental charges, the depositary bank may sell all or a portion of the new shares so distributed.

        No such distribution of new ADSs will be made if it would violate a law (i.e., the U.S. securities laws) or if it is not operationally practicable. If the depositary bank does not distribute new ADSs as described above, it may sell the shares received upon the terms described in the deposit agreement and will distribute the proceeds of the sale as in the case of a distribution of cash.

Distributions of Rights

        Whenever we intend to distribute rights to purchase additional shares, we will give prior notice to the depositary bank and we will assist the depositary bank in determining whether it is lawful and reasonably practicable to distribute rights to purchase additional ADSs to holders.

        The depositary bank will establish procedures to distribute rights to purchase additional ADSs to holders and to enable such holders to exercise such rights if it is lawful and reasonably practicable to make the rights available to holders of ADSs, and if we provide all of the documentation contemplated in the deposit agreement (such as opinions to address the lawfulness of the transaction). You may have to pay fees, expenses, taxes and other governmental charges to subscribe for the new ADSs upon the exercise of your rights. The depositary bank is not obligated to establish procedures to facilitate the distribution and exercise by holders of rights to purchase new shares other than in the form of ADSs.

        The depositary bank will not distribute the rights to you if:

•

We do not timely request that the rights be distributed to you or we request that the rights not be distributed to you; or

•

We fail to deliver satisfactory documents to the depositary bank; or

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•

It is not reasonably practicable to distribute the rights.

        The depositary bank will sell the rights that are not exercised or not distributed if such sale is lawful and reasonably practicable. The proceeds of such sale will be distributed to holders as in the case of a cash distribution. If the depositary bank is unable to sell the rights, it will allow the rights to lapse.

Elective Distributions

        Whenever we intend to distribute a dividend payable at the election of shareholders either in cash or in additional shares, we will give prior notice thereof to the depositary bank and will indicate whether we wish the elective distribution to be made available to you. In such case, we will assist the depositary bank in determining whether such distribution is lawful and reasonably practicable.

        The depositary bank will make the election available to you only if it is reasonably practicable and if we have provided all of the documentation contemplated in the deposit agreement. In such case, the depositary bank will establish procedures to enable you to elect to receive either cash or additional ADSs, in each case as described in the deposit agreement.

        If the election is not made available to you, you will receive either cash or additional ADSs, depending on what a shareholder in the Cayman Islands would receive upon failing to make an election, as more fully described in the deposit agreement.

Other Distributions

        Whenever we intend to distribute property other than cash, shares or rights to purchase additional shares, we will notify the depositary bank in advance and will indicate whether we wish such distribution to be made to you. If so, we will assist the depositary bank in determining whether such distribution to holders is lawful and reasonably practicable.

        If it is reasonably practicable to distribute such property to you and if we provide all of the documentation contemplated in the deposit agreement, the depositary bank will distribute the property to the holders in a manner it deems practicable.

        The distribution will be made net of fees, expenses, taxes and governmental charges payable by holders under the terms of the deposit agreement. In order to pay such taxes and governmental charges, the depositary bank may sell all or a portion of the property received.

        The depositary bank will not distribute the property to you and will sell the property if:

•

We do not request that the property be distributed to you or if we ask that the property not be distributed to you; or

•

We do not deliver satisfactory documents to the depositary bank; or

•

The depositary bank determines that all or a portion of the distribution to you is not reasonably practicable.

        The proceeds of such a sale will be distributed to holders as in the case of a cash distribution.

Redemption

        Whenever we decide to redeem any of the securities on deposit with the custodian, we will notify the depositary bank in advance. If it is practicable and if we provide all of the documentation contemplated in the deposit agreement, the depositary bank will provide notice of the redemption to the holders.

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        The custodian will be instructed to surrender the shares being redeemed against payment of the applicable redemption price. The depositary bank will convert the redemption funds received into U.S. dollars upon the terms of the deposit agreement and will establish procedures to enable holders to receive the net proceeds from the redemption upon surrender of their ADSs to the depositary bank. You may have to pay fees, expenses, taxes and other governmental charges upon the redemption of your ADSs. If less than all ADSs are being redeemed, the ADSs to be retired will be selected by lot or on a pro rata basis, as the depositary bank may determine.

Changes Affecting Shares

        The shares held on deposit for your ADSs may change from time to time. For example, there may be a change in nominal or par value, split-up, cancellation, consolidation or any other reclassification of such shares or a recapitalization, reorganization, merger, consolidation or sale of assets of the Company.

        If any such change were to occur, your ADSs would, to the extent permitted by law, represent the right to receive the property received or exchanged in respect of the shares held on deposit. The depositary bank may in such circumstances deliver new ADSs to you, amend the deposit agreement, the ADRs and the applicable Registration Statement(s) on Form F-6, call for the exchange of your existing ADSs for new ADSs and take any other actions that are appropriate to reflect as to the ADSs the change affecting the Class B ordinary shares. If the depositary bank may not lawfully distribute such property to you, the depositary bank may sell such property and distribute the net proceeds to you as in the case of a cash distribution.

Issuance of ADSs upon Deposit of Shares

        Upon completion of this offering, the shares being offered pursuant to this prospectus will be deposited by us with the custodian. Upon receipt of confirmation of such deposit, the depositary bank will issue ADSs to the underwriters named in this prospectus. After the completion of this offering, the Class B ordinary shares that are being offered for sale pursuant to this prospectus will be deposited by us with the custodian. Upon receipt of confirmation of such deposit, the depositary bank will issue ADSs to the underwriters named in this prospectus.

        After the closing of this offering, the depositary bank may create ADSs on your behalf if you or your broker deposit shares with the custodian. The depositary bank will deliver these ADSs to the person you indicate only after you pay any applicable issuance fees and any charges and taxes payable for the transfer of the shares to the custodian. Your ability to deposit shares and receive ADSs may be limited by U.S. and Cayman Islands legal considerations applicable at the time of deposit.

        We have instructed the depositary bank, and the depositary bank has agreed, not to accept any deposit of any shares or issue any ADSs for 180 days after the date of this prospectus (other than in connection with this offering) from those shareholders who owned our shares immediately prior to this offering. The depositary bank will not accept during this period the deposit of any shares unless it has received from such depositing holder a certificate to the effect that such depositing holder did not hold such shares immediately prior to this offering. The foregoing does not affect the right of ADS holders to cancel their ADSs and withdraw the underlying shares.

        The issuance of ADSs may be delayed until the depositary bank or the custodian receives confirmation that all required approvals have been given and that the shares have been duly transferred to the custodian. The depositary bank will only issue ADSs in whole numbers.

        When you make a deposit of shares, you will be responsible for transferring good and valid title to the depositary bank. As such, you will be deemed to represent and warrant that:

•

The shares are duly authorized, validly issued, fully paid, non-assessable and legally obtained.

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•

All preemptive (and similar) rights, if any, with respect to such shares have been validly waived or exercised.

•

You are duly authorized to deposit the shares.

•

The shares presented for deposit are free and clear of any lien, encumbrance, security interest, charge, mortgage or adverse claim, and are not, and the ADSs issuable upon such deposit will not be, "restricted securities" (as defined in the deposit agreement).

•

The shares presented for deposit have not been stripped of any rights or entitlements.

        If any of the representations or warranties are incorrect in any way, we and the depositary bank may, at your cost and expense, take any and all actions necessary to correct the consequences of the misrepresentations.

Transfer, Combination and Split Up of ADRs

        As an ADR holder, you will be entitled to transfer, combine or split up your ADRs and the ADSs evidenced thereby. For transfers of ADRs, you will have to surrender the ADRs to be transferred to the depositary bank and also must:

•

ensure that the surrendered ADR is properly endorsed or otherwise in proper form for transfer;

•

provide such proof of identity and genuineness of signatures as the depositary bank deems appropriate;

•

provide any transfer stamps required by the State of New York or the United States; and

•

pay all applicable fees, charges, expenses, taxes and other government charges payable by ADR holders pursuant to the terms of the deposit agreement, upon the transfer of ADRs.

        To have your ADRs either combined or split up, you must surrender the ADRs in question to the depositary bank with your request to have them combined or split up, and you must pay all applicable fees, charges and expenses payable by ADR holders, pursuant to the terms of the deposit agreement, upon a combination or split up of ADRs.

Withdrawal of Shares Upon Cancellation of ADSs

        As a holder, you will be entitled to present your ADSs to the depositary bank for cancellation and then receive the corresponding number of underlying shares at the custodian's offices. Your ability to withdraw the shares held in respect of the ADSs may be limited by U.S. and Cayman Islands law considerations applicable at the time of withdrawal. In order to withdraw the shares represented by your ADSs, you will be required to pay to the depositary bank the fees for cancellation of ADSs and any charges and taxes payable upon the transfer of the shares. You assume the risk for delivery of all funds and securities upon withdrawal. Once canceled, the ADSs will not have any rights under the deposit agreement.

        If you hold ADSs registered in your name, the depositary bank may ask you to provide proof of identity and genuineness of any signature and such other documents as the depositary bank may deem appropriate before it will cancel your ADSs. The withdrawal of the shares represented by your ADSs may be delayed until the depositary bank receives satisfactory evidence of compliance with all applicable laws and regulations. Please keep in mind that the depositary bank will only accept ADSs for cancellation that represent a whole number of securities on deposit.

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        You will have the right to withdraw the securities represented by your ADSs at any time except for:

•

Temporary delays that may arise because (i) the transfer books for the shares or ADSs are closed, or (ii) shares are immobilized on account of a shareholders' meeting or a payment of dividends.

•

Obligations to pay fees, taxes and similar charges.

•

Restrictions imposed because of laws or regulations applicable to ADSs or the withdrawal of securities on deposit.

        The deposit agreement may not be modified to impair your right to withdraw the securities represented by your ADSs except to comply with mandatory provisions of law.

Voting Rights

        As a holder, you generally have the right under the deposit agreement to instruct the depositary bank to exercise the voting rights for the shares represented by your ADSs. The voting rights of holders of shares are described in "Description of Share Capital."

        At our request, the depositary bank will distribute to you any notice of shareholders' meeting received from us together with information explaining how to instruct the depositary bank to exercise the voting rights of the securities represented by ADSs.

        Voting at our shareholders' meetings is by show of hands unless a poll is demanded. A poll may be demanded by the chairman of such shareholder meeting or any shareholder present in person or by proxy. If the depositary bank timely receives voting instructions from a holder of ADSs, it will endeavor to cause the shares on deposit to be voted as follows: (a) in the event voting takes place at a shareholders' meeting by show of hands, the depositary bank will instruct the custodian to vote all shares on deposit in accordance with the voting instructions received from a majority of the holders of ADSs who provided voting instructions; or (b) in the event voting takes place at a shareholders' meeting by poll, the depositary bank will instruct the custodian to vote the shares on deposit in accordance with the voting instructions received from holders of ADSs. In the event of voting by poll, shares in respect of which no timely voting instructions have been received from ADS holders will not be voted.

        Securities for which no voting instructions have been received will not be voted (except as otherwise contemplated herein). Please note that the ability of the depositary bank to carry out voting instructions may be limited by practical and legal limitations and the terms of the securities on deposit. We cannot assure you that you will receive voting materials in time to enable you to return voting instructions to the depositary bank in a timely manner.

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Fees and Charges

        As an ADS holder, you will be required to pay the following fees under the terms of the deposit agreement:

Service	Fees
•  Issuance of ADSs (i.e., an issuance of ADS upon a deposit of shares or upon a change in the ADS-to-share ratio), excluding ADS issuances as a result of distributions of shares	Up to U.S. 5¢ per ADS issued
•  Cancellation of ADSs (i.e., a cancellation of ADSs for delivery of deposited property or upon a change in the ADS-to-share ratio)	Up to U.S. 5¢ per ADS cancelled
•  Distribution of cash dividends or other cash distributions (i.e., upon a sale of rights and other entitlements)	Up to U.S. 5¢ per ADS held
•  Distribution of ADSs pursuant to (i) stock dividends or other free stock distributions, or (ii) exercise of rights to purchase additional ADSs	Up to U.S. 5¢ per ADS held
•  Distribution of securities other than ADSs or rights to purchase additional ADSs (i.e., upon a spin-off)	Up to U.S. 5¢ per ADS held
•  ADS Services	Up to U.S. 5¢ per ADS held on the applicable record date(s) established by the depositary bank

        As an ADS holder you will also be responsible to pay certain charges such as:

•

taxes (including applicable interest and penalties) and other governmental charges;

•

the registration fees as may from time to time be in effect for the registration of shares on the share register and applicable to transfers of shares to or from the name of the custodian, the depositary bank or any nominees upon the making of deposits and withdrawals, respectively;

•

certain cable, telex and facsimile transmission and delivery expenses;

•

the expenses and charges incurred by the depositary bank in the conversion of foreign currency;

•

the fees and expenses incurred by the depositary bank in connection with compliance with exchange control regulations and other regulatory requirements applicable to shares, ADSs and ADRs; and

•

the fees and expenses incurred by the depositary bank, the custodian, or any nominee in connection with the servicing or delivery of deposited property.

        ADS fees and charges payable upon (i) the issuance of ADSs, and (ii) the cancellation of ADSs are charged to the person to whom the ADSs are issued (in the case of ADS issuances) and to the person whose ADSs are cancelled (in the case of ADS cancellations). In the case of ADSs issued by the depositary bank into DTC, the ADS issuance and cancellation fees and charges may be deducted from distributions made through DTC, and may be charged to the DTC participant(s) receiving the ADSs being issued or the DTC participant(s) holding the ADSs being cancelled, as the case may be, on behalf of the beneficial owner(s) and will be charged by the DTC participant(s) to the account of the

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applicable beneficial owner(s) in accordance with the procedures and practices of the DTC participants as in effect at the time. ADS fees and charges in respect of distributions and the ADS service fee are charged to the holders as of the applicable ADS record date. In the case of distributions of cash, the amount of the applicable ADS fees and charges is deducted from the funds being distributed. In the case of (i) distributions other than cash and (ii) the ADS service fee, holders as of the ADS record date will be invoiced for the amount of the ADS fees and charges and such ADS fees and charges may be deducted from distributions made to holders of ADSs. For ADSs held through DTC, the ADS fees and charges for distributions other than cash and the ADS service fee may be deducted from distributions made through DTC, and may be charged to the DTC participants in accordance with the procedures and practices prescribed by DTC and the DTC participants in turn charge the amount of such ADS fees and charges to the beneficial owners for whom they hold ADSs.

        In the event of refusal to pay the depositary bank fees, the depositary bank may, under the terms of the deposit agreement, refuse the requested service until payment is received or may set off the amount of the depositary bank fees from any distribution to be made to the ADS holder. Certain of the depositary fees and charges (such as the ADS services fee) may become payable shortly after the closing of the ADS offering. Note that the fees and charges you may be required to pay may vary over time and may be changed by us and by the depositary bank. You will receive prior notice of such changes. The depositary bank may reimburse us for certain expenses incurred by us in respect of the ADR program, by making available a portion of the ADS fees charged in respect of the ADR program or otherwise, upon such terms and conditions as we and the depositary bank agree from time to time.

Amendments and Termination

        We may agree with the depositary bank to modify the deposit agreement at any time without your consent. We undertake to give holders 30 days' prior notice of any modifications that would materially prejudice any of their substantial rights under the deposit agreement. We will not consider to be materially prejudicial to your substantial rights any modifications or supplements that are reasonably necessary for the ADSs to be registered under the Securities Act or to be eligible for book-entry settlement, in each case without imposing or increasing the fees and charges you are required to pay. In addition, we may not be able to provide you with prior notice of any modifications or supplements that are required to accommodate compliance with applicable provisions of law.

        You will be bound by the modifications to the deposit agreement if you continue to hold your ADSs after the modifications to the deposit agreement become effective. The deposit agreement cannot be amended to prevent you from withdrawing the shares represented by your ADSs (except as permitted by law).

        We have the right to direct the depositary bank to terminate the deposit agreement. Similarly, the depositary bank may in certain circumstances on its own initiative terminate the deposit agreement. In either case, the depositary bank must give notice to the holders at least 30 days before termination. Until termination, your rights under the deposit agreement will be unaffected.

        After termination, the depositary bank will continue to collect distributions received (but will not distribute any such property until you request the cancellation of your ADSs) and may sell the securities held on deposit. After the sale, the depositary bank will hold the proceeds from such sale and any other funds then held for the holders of ADSs in a non-interest bearing account. At that point, the depositary bank will have no further obligations to holders other than to account for the funds then held for the holders of ADSs still outstanding (after deduction of applicable fees, taxes and expenses).

        In connection with any termination of the deposit agreement, the depositary bank may make available to owners of ADSs a means to withdraw the shares represented by ADSs and to direct the depositary bank of such shares into an unsponsored American depositary share program established by the depositary bank. The ability to receive unsponsored American depositary shares upon termination

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of the deposit agreement would be subject to satisfaction of certain U.S. regulatory requirements applicable to the creation of unsponsored American depositary shares and the payment of applicable depositary fees.

Books of Depositary

        The depositary bank will maintain ADS holder records at its depositary office. You may inspect such records at such office during regular business hours but solely for the purpose of communicating with other holders in the interest of business matters relating to the ADSs and the deposit agreement.

        The depositary bank will maintain in New York facilities to record and process the issuance, cancellation, combination, split-up and transfer of ADSs. These facilities may be closed from time to time, to the extent not prohibited by law.

Limitations on Obligations and Liabilities

        The deposit agreement limits our obligations and the depositary bank's obligations to you. Please note the following:

•

We and the depositary bank are obligated only to take the actions specifically stated in the deposit agreement without negligence or bad faith.

•

The depositary bank disclaims any liability for any failure to carry out voting instructions, for any manner in which a vote is cast or for the effect of any vote, provided it acts in good faith and in accordance with the terms of the deposit agreement.

•

The depositary bank disclaims any liability for any failure to determine the lawfulness or practicality of any action, for the content of any document forwarded to you on our behalf or for the accuracy of any translation of such a document, for the investment risks associated with investing in shares, for the validity or worth of the shares, for any tax consequences that result from the ownership of ADSs, for the credit-worthiness of any third party, for allowing any rights to lapse under the terms of the deposit agreement, for the timeliness of any of our notices or for our failure to give notice.

•

We and the depositary bank will not be obligated to perform any act that is inconsistent with the terms of the deposit agreement.

•

We and the depositary bank disclaim any liability if we or the depositary bank are prevented or forbidden from or subject to any civil or criminal penalty or restraint on account of, or delayed in, doing or performing any act or thing required by the terms of the deposit agreement, by reason of any provision, present or future of any law or regulation, or by reason of present or future provision of any provision of our articles of incorporation, or any provision of or governing the securities on deposit, or by reason of any act of God or war or other circumstances beyond our control.

•

We and the depositary bank disclaim any liability by reason of any exercise of, or failure to exercise, any discretion provided for in the deposit agreement or in our articles of incorporation or in any provisions of or governing the securities on deposit.

•

We and the depositary bank further disclaim any liability for any action or inaction in reliance on the advice or information received from legal counsel, accountants, any person presenting Class B ordinary shares for deposit, any holder of ADSs or authorized representatives thereof, or any other person believed by either of us in good faith to be competent to give such advice or information.

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•

We and the depositary bank also disclaim liability for the inability by a holder to benefit from any distribution, offering, right or other benefit that is made available to holders of shares but is not, under the terms of the deposit agreement, made available to you.

•

We and the depositary bank may rely without any liability upon any written notice, request or other document believed to be genuine and to have been signed or presented by the proper parties.

•

We and the depositary bank also disclaim liability for any consequential or punitive damages for any breach of the terms of the deposit agreement.

•

No disclaimer of any Securities Act liability is intended by any provision of the deposit agreement.

Pre-Release Transactions

        Subject to the terms and conditions of the deposit agreement, the depositary bank may issue to broker/dealers ADSs before receiving a deposit of shares or release shares to broker/dealers before receiving ADSs for cancellation. These transactions are commonly referred to as "pre-release transactions," and are entered into between the depositary bank and the applicable broker/dealer. The deposit agreement limits the aggregate size of pre-release transactions (not to exceed 30% of the shares on deposit in the aggregate) and imposes a number of conditions on such transactions (i.e., the need to receive collateral, the type of collateral required, the representations required from brokers, etc.). The depositary bank may retain the compensation received from the pre-release transactions.

Taxes

        You will be responsible for the taxes and other governmental charges payable on the ADSs and the securities represented by the ADSs. We, the depositary bank and the custodian may deduct from any distribution the taxes and governmental charges payable by holders and may sell any and all property on deposit to pay the taxes and governmental charges payable by holders. You will be liable for any deficiency if the sale proceeds do not cover the taxes that are due.

        The depositary bank may refuse to issue ADSs, to deliver, transfer, split and combine ADRs or to release securities on deposit until all taxes and charges are paid by the applicable holder. The depositary bank and the custodian may take reasonable administrative actions to obtain tax refunds and reduced tax withholding for any distributions on your behalf. However, you may be required to provide to the depositary bank and to the custodian proof of taxpayer status and residence and such other information as the depositary bank and the custodian may require to fulfill legal obligations. You are required to indemnify us, the depositary bank and the custodian for any claims with respect to taxes based on any tax benefit obtained for you.

Foreign Currency Conversion

        The depositary bank will arrange for the conversion of all foreign currency received into U.S. dollars if such conversion is practical, and it will distribute the U.S. dollars in accordance with the terms of the deposit agreement. You may have to pay fees and expenses incurred in converting foreign currency, such as fees and expenses incurred in complying with currency exchange controls and other governmental requirements.

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        If the conversion of foreign currency is not practical or lawful, or if any required approvals are denied or not obtainable at a reasonable cost or within a reasonable period, the depositary bank may take the following actions in its discretion:

•

Convert the foreign currency to the extent practical and lawful and distribute the U.S. dollars to the holders for whom the conversion and distribution is lawful and practical.

•

Distribute the foreign currency to holders for whom the distribution is lawful and practical.

•

Hold the foreign currency (without liability for interest) for the applicable holders.

Governing Law/Waiver of Jury Trial

        The deposit agreement and the ADRs will be interpreted in accordance with the laws of the State of New York. The rights of holders of shares (including Class B Ordinary Shares represented by ADSs) is governed by the laws of the Cayman Islands.

        AS A PARTY TO THE DEPOSIT AGREEMENT, YOU WAIVE YOUR RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF THE DEPOSIT AGREEMENT OR THE ADRs AGAINST US AND/OR THE DEPOSITARY BANK.

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SHARES ELIGIBLE FOR FUTURE SALE

        Upon completion of this offering, we will have                        ADSs outstanding, representing                        Class B ordinary shares, or approximately                        % of our outstanding ordinary shares. All of the ADSs sold in this offering will be freely transferable by persons other than our "affiliates" without restriction or further registration under the Securities Act. Sales of substantial amounts of the ADSs in the public market could adversely affect prevailing market prices of the ADSs. Prior to this offering, there has been no public market for our Class B ordinary shares or the ADSs, and while we have applied to list the ADSs on the NASDAQ Global Market we cannot assure you that a regular trading market in the ADSs will develop. We do not expect that a trading market will develop for our ordinary shares not represented by the ADSs.

Lock-Up Agreements

        Certain of our shareholders, all of our directors and executive officers and certain of our option holders, have agreed with the underwriters that for a period of 180 days following the date of this prospectus they will not, without the prior consent of the representatives, offer, sell, contract to sell, pledge, grant any option to purchase, purchase any option or contract to sell, right or warrant to purchase, make any short sale, file a registration statement (other than a registration statement on Form S-8) with respect to, or otherwise dispose of (including entering into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequence of ownership interests) any of the ADSs or ordinary shares or any securities that are convertible into or exchangeable for, or that represent the right to receive, the ADSs or ordinary shares or any substantially similar securities (other than pursuant to employee stock option plans existing on, or upon the conversion or exchange of convertible or exchangeable securities outstanding as of the date of this prospectus), subject to certain exceptions.

        In addition, through a letter agreement, we will instruct Citibank, N.A., as depositary, not to accept any deposit of any ordinary shares or issue any ADSs for 180 days after the date of this prospectus unless we consent to such deposit or issuance and not to provide consent without the prior written consent of Goldman Sachs (Asia) L.L.C. and Citigroup Global Markets Inc. The foregoing does not affect the right of ADS holders to cancel their ADSs and withdraw the underlying Class B ordinary shares.

Rule 144

        All of our ordinary shares outstanding prior to this offering are "restricted securities" as that term is defined in Rule 144 under the Securities Act and may be sold publicly in the United States only if they are subject to an effective registration statement under the Securities Act or pursuant to an exemption from the registration requirements. Under Rule 144 as currently in effect, a person who has beneficially owned our restricted shares for at least six months is generally entitled to sell the restricted securities without registration under the Securities Act beginning 90 days after the date of this prospectus, subject to certain additional restrictions.

        Our affiliates may sell within any three-month period a number of restricted securities that does not exceed the greater of the following:

•

1% of the then outstanding Class B ordinary shares, in the form of ADSs or otherwise, which will equal approximately             Class B ordinary shares immediately after this offering; or

•

the average weekly trading volume of our Class B ordinary shares in the form of ADSs or otherwise, on the                        , during the four calendar weeks preceding the date on which notice of the sale is filed with the SEC.

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        Affiliates who sell restricted securities under Rule 144 may not solicit orders or arrange for the solicitation of orders, and they are also subject to notice requirements and the availability of current public information about us.

        Persons who are not our affiliates are only subject to one of these additional restrictions, the requirement of the availability of current public information about us, and this additional restriction does not apply if they have beneficially owned our restricted shares for more than one year.

Rule 701

        In general, under Rule 701 of the Securities Act as currently in effect, each of our employees, consultants or advisors who purchases our ordinary shares from us in connection with a compensatory stock or option plan or other written agreement relating to compensation is eligible to resell such ordinary shares 90 days after we became a reporting company under the Exchange Act in reliance on Rule 144, but without compliance with some of the restrictions, including the holding period, contained in Rule 144.

Registration Rights

        Upon completion of this offering, some holders of our ordinary shares or their transferees will be entitled to request that we register their shares under the Securities Act, following the expiration of the lock-up agreements described above. See "Description of Share Capital—Registration Rights."

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TAXATION

This is a summary of material Cayman Islands, PRC and U.S. federal income tax consequences of an investment in the ADSs or Class B ordinary shares. It is based upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change. This summary does not deal with all possible tax consequences relating to an investment in the ADSs or Class B ordinary shares, such as the tax consequences under state, local and other tax laws. To the extent that the discussion relates to matters of Cayman Islands tax law, it is the opinion of Travers Thorp Alberga, our Cayman Islands counsel. To the extent the discussion relates to matters of PRC law and such discussion states definitive legal conclusions under PRC tax laws and regulations, it represents the opinion of Commerce & Finance Law Offices, our PRC counsel. The opinion of Fenwick & West LLP, our U.S. counsel, as to certain matters related to U.S. federal income taxes is contained as an exhibit to this registration statement, of which this prospectus forms a part.

Cayman Islands Taxation

        The Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or brought within, the jurisdiction of the Cayman Islands. The Cayman Islands is not party to any double tax treaties which are applicable to any payments made by or to our company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

People's Republic of China Taxation

        The PRC Enterprise Income Tax Law, or the EIT Law, which became effective on January 1, 2008, provides that an enterprise established under the laws of a foreign country or region but whose "de facto management body" is located in the PRC is treated as a PRC resident enterprise for PRC tax purposes and consequently is subject to PRC enterprise income tax at the rate of 25% on its global income. On April 22, 2009, the State Administration of Taxation, or SAT, issued the Notice Regarding, the Determination of Chinese-Controlled Overseas Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, or Circular 82, which provides certain specific criteria for determining whether the "de facto management body" of a PRC controlled enterprise that is incorporated offshore is located in the PRC. Furthermore, the SAT issued the Administrative Measures for Enterprise Income Tax of Chinese-Controlled Overseas Incorporated Resident Enterprises (Trial Version), or Bulletin No. 45, which became effective on September 1, 2011, to provide more guidance on the implementation of Circular 82. Bulletin No. 45 clarified certain issues in the areas of resident status determination, post-determination administration and competent tax authorities procedures. According to Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be considered as a PRC tax resident enterprise by virtue of having its "de facto management body" in the PRC only if all of the following conditions are met: (a) the senior management and core management departments in charge of its daily operations are located mainly in the PRC; (b) its financial and human resources decisions are subject to determination or approval by persons or bodies in the PRC; (c) its major assets, accounting books, company seals, and minutes and files of its board and shareholders' meetings are located or kept in the PRC; and (d) at least half of the enterprise's directors or senior management with voting rights habitually reside in the PRC. Although Circular 82 and Bulletin No. 45 only apply to offshore incorporated enterprises controlled by PRC enterprises or PRC enterprise groups and not those controlled by PRC individuals or foreigners, the determination criteria set forth therein may reflect the SAT's general position on how the term "de facto management body" could be applied in determining

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the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises, individuals or foreigners.

        We believe that neither Gridsum Cayman nor Gridsum HK is a PRC resident enterprise for PRC tax purposes, because neither of them meets all of the criteria described above. Neither is controlled by a PRC enterprise or PRC enterprise group. Their records (including the resolutions of the board of directors and the resolutions of shareholders) are maintained outside the PRC. However, an enterprise's tax resident status is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term "de facto management body" when applied to our offshore entities.

        If the PRC tax authorities determine that we are a PRC resident enterprise, we will be subject to PRC enterprise income tax at 25% on our global income. In addition, dividends paid by us to our non-PRC shareholders may be subject to PRC withholding tax, and gains realized on the sale or other disposition of the ADSs or Class B ordinary shares may be subject to PRC tax, at a rate of 0% in the case of non-PRC corporate shareholders that are deemed PRC resident enterprises, 10% in the case of non-PRC corporate shareholders that are deemed non-resident enterprises or 20% in the case of non-PRC individual shareholders (in each case, subject to any applicable tax treaty), if such dividends or gains are deemed to be from sources within the PRC. A holder of our Class B ordinary shares or the ADSs (other than our depositary bank who is a nominee shareholder) may be deemed a "non-resident enterprise" if (a) its "de facto management body" is outside the PRC, and (b) it meets one of the following conditions: (i) it has establishment or place of business within the PRC, or (ii) it does not have establishment or place of business within the PRC but has received income from PRC sources. As a result, you may be subject to PRC withholding tax on dividends distributed by us or gains realized on the disposition of the ADSs or Class B ordinary shares, unless the jurisdiction of your incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands does not have such tax treaty with China. Any such tax may reduce the returns on your investment in the ADSs. Furthermore, if we are a PRC resident enterprise and the dividends paid by us to our non-PRC shareholders are subject to PRC withholding tax, we will be obligated to withhold and pay such tax in respect of the dividends actually paid by us to our non-PRC shareholders, and failure to so withhold and pay may subject us to a penalty of up to three times of the unpaid tax imposed by the relevant PRC tax authority.

        If we are deemed a "non-resident enterprise" by the PRC tax authorities, the dividends paid to us by our PRC subsidiary will be subject to a 10% withholding tax (or a 5% withholding tax in certain circumstances discussed below). The EIT Law imposes a withholding income tax of 10% on dividends distributed by an FIE to its immediate holding company outside of the PRC, if such immediate holding company is considered as a non-resident enterprise without any establishment or place of business within the PRC or if the received dividends have no connection with the establishment or place of business of such immediate holding company within the PRC, unless such immediate holding company's jurisdiction of incorporation has a tax treaty with the PRC that provides for a different withholding arrangement. Under the Arrangement Between the PRC and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion With Respect to Taxes on Income, the dividend withholding tax rate may be reduced to 5%, if a Hong Kong resident enterprise that receives the dividends is considered a "non-resident enterprise" and holds at least 25% of the equity interests in the PRC enterprise distributing the dividends, subject to approval of the PRC local tax authority. However, if the Hong Kong resident enterprise is not considered to be the beneficial owner of such dividends under applicable PRC tax regulations, such dividends may remain subject to withholding tax at a rate of 10%. Accordingly, dividends received by Gridsum HK from our PRC subsidiary will be subject to PRC withholding tax, the rate of which might be reduced from 10% to 5% if Gridsum HK satisfies the relevant conditions under applicable PRC tax regulations and obtains the approvals as required.

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Material United States Federal Income Tax Considerations

        The following is a discussion of material U.S. federal income tax considerations relating to the acquisition, ownership and disposition of the ADSs or Class B ordinary shares by U.S. Holders (as defined below) that will hold the ADSs or Class B ordinary shares as "capital assets" (generally, property held for investment) as of the date hereof and under the U.S. Internal Revenue Code of 1986, as amended, or the Code. This discussion is based upon applicable provisions of the Code, Treasury regulations promulgated thereunder, pertinent judicial decisions, interpretive rulings of the Internal Revenue Service, or the IRS, and such other authorities as are relevant, all as of the date hereof, and all of which are subject to change, possibly with retroactive effect. In addition, this discussion is based, in part, upon representations made by the depositary to us and assumes that the deposit agreement, and all other related agreements, will be performed in accordance with their terms. This discussion does not address all aspects of U.S. federal income taxation that may be important to particular investors in light of their individual investment circumstances, including investors subject to special tax rules (for example, certain financial institutions, insurance companies, broker-dealers, pension plans, regulated investment companies, real estate investment trusts, cooperatives, tax-exempt organizations (including private foundations), holders who are not U.S. Holders, holders who own (directly, indirectly or constructively) 10% or more of our voting stock, investors that will hold their ADSs or Class B ordinary shares as part of a straddle, hedge, conversion, constructive sale or other integrated transaction for U.S. federal income tax purposes, investors that are traders in securities that have elected the mark-to-market method of accounting or investors that have a functional currency other than the U.S. Dollar), all of whom may be subject to tax rules that differ significantly from those discussed below.

        In addition, this discussion does not address any non-U.S., state, local or any U.S. federal estate, gift or alternative minimum tax considerations. Each U.S. Holder is urged to consult its tax advisors regarding the U.S. federal, state, local and non-U.S. income and other tax considerations of an investment in ADSs or Class B ordinary shares.

General

        The discussion below of U.S. federal income tax consequences to "U.S. Holders" will apply to you if you are a beneficial owner of the ADSs or Class B ordinary shares and you are, for U.S. federal income tax purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation, or other entity treated as a corporation for U.S. federal income tax purposes, created in or organized under the law of the United States or any state thereof or the District of Columbia, (iii) an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source or (iv) a trust (A) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust or (B) that has otherwise validly elected to be treated as a U.S. person under the Code.

        If you are a partner in a partnership or other entity treated as a partnership for U.S. federal income tax purposes that holds the ADSs or Class B ordinary shares, your tax treatment generally will depend on your status (including, for example, whether you are a U.S. Holder) and the activities of the partnership. Partners in a partnership holding the ADSs or Class B ordinary shares should consult their tax advisers regarding the tax consequences of an investment in the ADSs or Class B ordinary shares.

ADSs

        If you hold ADSs, for U.S. federal income tax purposes, you generally will be treated as the owner of the underlying Class B ordinary shares that are represented by such ADSs. Accordingly, deposits or

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withdrawals of Class B ordinary shares for ADSs, or vice versa, will not be subject to U.S. federal income tax.

Dividends

        Subject to the discussion under "—Passive Foreign Investment Company Rules" below, any cash distributions (including the amount of any PRC tax withheld if we are deemed to be a PRC resident enterprise under PRC tax law) paid on the ADSs or Class B ordinary shares out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles, will generally be includible in your gross income as dividend income on the day actually or constructively received by you, in the case of Class B ordinary shares, or by the depositary, in the case of ADSs. Dividends received on the ADSs or Class B ordinary shares will not be eligible for the dividends received deduction allowed to corporations under the Code.

        A non-corporate recipient of dividends will be subject to tax at the reduced tax rate applicable to "qualified dividend income," provided that certain conditions are satisfied, including that (1) the ADSs are readily tradable on an established securities market in the United States, or, in the event that we are deemed to be a PRC resident enterprise under the PRC tax law, we are eligible for the benefit of the United States-PRC income tax treaty, or the Treaty, (2) we are neither a passive foreign investment company nor treated as such with respect to a U.S. Holder (as discussed below) for the taxable year in which the dividend was paid or the preceding taxable year and (3) certain holding period requirements are met.

        We have applied to list the ADSs on the NASDAQ Global Market. Provided that the listing is approved, United States Treasury Department guidance indicates that the ADSs will be readily tradable on an established securities market in the United States. Thus, provided we are not classified as a PFIC subject to the U.S. federal income tax rules governing PFICs summarized in the discussion below under "—Passive Foreign Investment Company Rules" and certain holding period requirements are met, we believe that dividends we pay on the ADSs will meet the conditions required for the reduced tax rate applicable to "qualified dividend income." However, since we do not expect that our Class B ordinary shares will be listed on an established securities market, we do not believe that dividends that we pay on our Class B ordinary shares that are not represented by ADSs currently meet the conditions required for these reduced tax rates (unless we are eligible for the benefit of the Treaty as discussed below).

        In the event that we are deemed to be a PRC resident enterprise under PRC tax law, you may be subject to PRC withholding taxes on dividends paid on the ADSs or Class B ordinary shares. If we are deemed to be a PRC resident enterprise, we may, however, be eligible for the benefits of the Treaty. If we are eligible for such benefits, dividends we pay on our Class B ordinary shares, regardless of whether such shares are represented by the ADSs, would be eligible for the reduced rates of taxation applicable to qualified dividend income, as discussed above. Determining eligibility for benefits under U.S. income tax treaties is complex. You should consult your tax advisor if you intend to rely on our eligibility for the benefits of the Treaty to claim a reduced rate of tax on dividends.

        For U.S. foreign tax credit purposes, dividends generally will be treated as income from foreign sources and generally will constitute passive category income. Depending on your particular circumstances, you may be eligible, subject to a number of complex limitations, to claim a foreign tax credit in respect of any foreign withholding taxes imposed on dividends received on the ADSs or Class B ordinary shares. If you do not elect to claim a foreign tax credit for foreign tax withheld, you are permitted instead to claim a deduction, for U.S. federal income tax purposes, for the foreign tax withheld, but only for a year in which you elect to do so for all creditable foreign income taxes. The rules governing the foreign tax credit are complex. You are urged to consult your tax advisor regarding the availability of the foreign tax credit under your particular circumstances.

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        To the extent that the amount of any distribution exceeds our current and accumulated earnings and profits for a taxable year, as determined under U.S. federal income tax principles, the distribution will first be treated as a tax-free return of capital, causing a reduction in the adjusted basis of the ADSs or Class B ordinary shares, and to the extent the amount of the distribution exceeds your tax basis, the excess will be taxed as capital gain recognized on a sale or exchange. Because we do not intend to determine our earnings and profits under U.S. federal income tax principles, any distribution paid will generally be treated as a "dividend" for U.S. federal income tax purposes (as discussed above). Consequently, your taxable dividend income may be greater than it would be if we determined our earnings and profits under U.S. federal income tax purposes.

Sale or Other Disposition of ADSs or Class B Ordinary Shares

        Subject to the discussion under "—Passive Foreign Investment Company Rules" below, you generally will recognize capital gain or loss upon the sale or other disposition of the ADSs or Class B ordinary shares in an amount equal to the difference, if any, between the amount realized upon the disposition and your adjusted basis in such ADSs or Class B ordinary shares. Any capital gain or loss will be long-term capital gain or loss if you have held the ADSs or Class B ordinary shares for more than one year and will generally be U.S.-source gain or loss for U.S. foreign tax credit purposes. In the event that we are deemed to be a PRC resident enterprise under PRC tax law and gain from the disposition of the ADSs or Class B ordinary shares would be subject to tax in the PRC, you generally can elect to treat the gain as PRC-source gain for U.S. foreign tax credit purposes under the Treaty. The deductibility of a capital loss may be subject to limitations. You are urged to consult your tax advisor regarding the tax consequences if a foreign tax is imposed on a disposition of the ADSs or Class B ordinary shares, including any election to treat the gain on disposition as having a PRC source under the Treaty and the availability of the foreign tax credit under your particular circumstances.

Passive Foreign Investment Company Rules

        A non-U.S. corporation, such as our company, will be classified as a "passive foreign investment company," or PFIC, for U.S. federal income tax purposes for any taxable year, if either (i) 75% or more of its gross income for such year consists of certain types of "passive" income or (ii) 50% or more of the value of its assets (determined on the basis of a quarterly average) during such year produce or are held for the production of passive income. Passive income generally includes dividends, interest, royalties, rents, annuities, net gains from the sale or exchange of property producing such income and net foreign currency gains. For this purpose, cash is categorized as a passive asset and the company's unbooked intangibles associated with active business activity are taken into account as a non-passive asset. We will be treated as owning our proportionate share of the assets and earning our proportionate share of the income of any other corporation in which we own, directly or indirectly, at least 25% (by value) of the stock.

        Although the law in this regard is unclear, we intend to treat our VIE as being owned by us for U.S. federal income tax purposes, not only because we exercise effective control over the operation of such entity but also because we are entitled to substantially all of its economic benefits and burdens, and, as a result, we consolidate its results of operation in our consolidated financial statements. If it were determined, however, that we are not the owner of our VIE for U.S. federal income tax purposes, the PFIC rules would apply differently to us, and as a result, we could be treated as a PFIC for our current taxable year and/or future taxable years.

        Assuming we are the owner of our VIE for U.S. federal income tax purposes, based on our current income and assets and projections of the value of the ADSs and Class B ordinary shares following this offering, we do not believe we were a PFIC for the 2015 taxable year, and we presently do not expect to be classified as a PFIC for the current taxable year and we do not anticipate becoming a PFIC in future taxable years. While we do not anticipate becoming a PFIC, changes in the nature of

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our income or assets or the value of the ADSs and Class B ordinary shares may cause us to become a PFIC for the current or any subsequent taxable year. The composition of our income and our assets will also be affected by how, and how quickly, we spend our liquid assets and the cash raised in this offering. Under circumstances where revenues from activities that produce passive income significantly increase relative to our revenues from activities that produce non-passive income or where we determine not to deploy significant amounts of cash, our risk of becoming classified as a PFIC may substantially increase.

        The discussion above under "—Dividends" and "—Sale or Other Disposition of ADSs or Class B Ordinary Shares" assumes that we will not be classified as a PFIC for U.S. federal income tax purposes.

        If we were classified as a PFIC in any year with respect to which a U.S. Holder holds ADSs or Class B ordinary shares, we would continue to be treated as a PFIC with respect to the U.S. Holder in all succeeding years during which the U.S. Holder owns the ADSs or Class B ordinary shares, regardless of whether we continue to meet the tests described above.

        If we were treated as a PFIC for any taxable year during which a taxable U.S. Holder held the ADS or Class B ordinary shares, gain recognized by the U.S. Holder on a sale or other disposition (including certain pledges) of the ADSs or Class B ordinary shares would be allocated ratably over the U.S. Holder's holding period for the ADSs or Class B ordinary shares. The amounts allocated to the taxable year of the sale or other disposition and to any year before we became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, for that taxable year, and an interest charge would be imposed on the amount allocated to that taxable year. Further, to the extent that any dividend or other distribution received by a U.S. Holder on its ADSs or Class B ordinary shares exceeded 125% of the average of the annual distributions received by the U.S. Holder on its ADSs or Class B ordinary shares during the preceding three years or the U.S. Holder's holding period, whichever is shorter, that distribution (referred to as "excess distribution") would be subject to taxation in the same manner as gain, described immediately above.

        Thus, gains on disposition of ADSs or Class B ordinary shares, and excess distributions thereon, are taxed at ordinary income rates and subject to an interest charge, which generally results in a significantly greater amount of U.S. tax than would otherwise be imposed if the PFIC rules did not apply.

        Certain elections may be available that would result in alternative treatments of the ADSs or Class B ordinary shares. However, we do not expect that we will prepare or provide to U.S. Holders a "PFIC annual information statement," which would enable a U.S. Holder to make one type of election, a "qualified electing fund" or "QEF" election.

        If the ADSs were considered "marketable stock" (as defined below), U.S. Holders generally would be eligible to make a different type of election, a "mark-to-market" election, to elect out of the tax treatment discussed in the preceding paragraphs. If you make a valid mark-to-market election for the ADSs, you generally will include in income each year, as ordinary income, an amount equal to the increase in the fair market value of the ADSs during the year, and you will be allowed an ordinary deduction for any reduction in the fair market value. However, deductions will be allowable only to the extent of any net mark-to-market income you reported on the ADSs in prior years. Gain on the sale or other disposition of the ADSs will also be treated as ordinary income. Loss on sale will be treated as ordinary loss to the extent of any net mark-to-market gains you reported on the ADSs. Your basis in the ADSs will be adjusted to reflect any annual mark-to-market income or loss amounts.

        The mark-to-market election is available only for "marketable stock" which is stock that is traded in other than de minimis quantities on at least 15 days during each calendar quarter ("regularly

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traded") on a qualified exchange or other market, as defined in applicable Treasury regulations. We expect that the ADSs will be listed on the NASDAQ Global Market, which is a qualified exchange for these purposes, and, consequently, assuming that the ADSs are regularly traded, if you are a holder of ADSs, it is expected that the mark-to-market election would be available to you if we were to become a PFIC. It should be noted that only the ADSs and not the Class B ordinary shares will be listed on the NASDAQ Global Market. Consequently, if you are a U.S. Holder of Class B ordinary shares that are not represented by ADSs, you generally will not be eligible to make a mark-to-market election if we are or were to become a PFIC.

        Each U.S. Holder of a PFIC is required to file an annual report containing such information as the U.S. Department of the Treasury may require.

        U.S. Holders are strongly urged to consult their own tax advisors regarding the details of the PFIC rules and any elections that may be available.

Medicare Tax

        U.S. Holders that are individuals, estates or trusts and whose income exceeds certain thresholds will generally be subject to a 3.8% Medicare tax (in addition to the regular income tax) on certain investment income, including dividends and gains from the sale, exchange or other taxable disposition of an ADS or Class B ordinary share. You are urged to consult your tax advisors regarding the applicability of the Medicare tax to your income and gains in respect of an investment in the ADSs or Class B ordinary shares.

Information Reporting and Backup Withholding

        You may be required to submit to the IRS certain information with respect to your beneficial ownership of the ADSs or Class B ordinary shares, if such ADSs or Class B ordinary shares are not held on your behalf by a financial institution. This law also imposes penalties if you are required to submit such information to the IRS and fail to do so.

        Dividend payments with respect to ADSs or Class B ordinary shares and proceeds from the sale, exchange or redemption of ADSs or Class B ordinary shares may be subject to information reporting to the IRS and possible U.S. backup withholding. Backup withholding will not apply, however, to a U.S. Holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding and in the case of dividend payments, reports the full amount of dividend income. U.S. Holders who are required to establish their exempt status must provide such certification on IRS Form W-9.

        Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against your U.S. federal income tax liability, and you may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS and furnishing any required information. You are urged to consult your tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

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UNDERWRITING (CONFLICTS OF INTEREST)

        We and the underwriters named below have entered into an underwriting agreement with respect to the ADSs being offered. Under the terms and subject to the conditions contained in the underwriting agreement, each underwriter has severally agreed to purchase the number of ADSs indicated in the following table. Goldman Sachs (Asia) L.L.C., Citigroup Global Markets Inc. and Stifel are acting as joint bookrunners of this offering. Goldman Sachs (Asia) L.L.C. and Citigroup Global Markets Inc. are acting as the representatives of the underwriters.

Underwriters	Number of ADSs
Goldman Sachs (Asia) L.L.C.
Citigroup Global Markets Inc.
Stifel, Nicolaus & Company, Incorporated
Total

        The underwriters are offering the ADSs subject to their acceptance of the ADSs from us and subject to prior sale. The underwriting agreement provides that the obligations of the several underwriters to pay for and accept delivery of the ADSs offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriters are obligated, severally and not jointly, to take and pay for all of the ADSs offered by this prospectus if any such ADSs are taken, other than the ADSs covered by the underwriters' option to purchase additional ADSs described below. The underwriting agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may be increased or the offering may be terminated.

        The underwriters initially propose to offer part of the ADSs directly to the public at the public offering price listed on the cover of this prospectus and part of the ADSs to certain dealers at a price that represents a concession not in excess of US$            per ADS from the initial public offering price. After the initial offering of the ADSs, the offering price and other selling terms may from time to time be varied by the underwriters.

        Certain of the underwriters are expected to make offers and sales both inside and outside the United States through their respective selling agents. Any offers or sales in the United States will be conducted by broker-dealers registered with the SEC. Goldman Sachs (Asia) L.L.C. will offer the ADSs in the United States through its SEC registered broker-dealer affiliate in the United States, Goldman Sachs & Co.

        The address of Goldman Sachs (Asia) L.L.C. is 68^th Floor, Cheung Kong Center, 2 Queens Road, Central, Hong Kong. The address of Citigroup Global Markets Inc. is 388 Greenwich Street, New York, NY 10013, United States.

Option to Purchase Additional ADSs

        We have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase up to an aggregate of                        additional ADSs from us at the public offering price listed on the cover of this prospectus, less underwriters discounts and commissions. To the extent the option is exercised, each underwriter will become severally obligated, subject to certain conditions, to purchase additional ADSs approximately proportionate to each underwriter's initial amount reflected in the table above.

Commissions and Expenses

        Total underwriting discounts and commissions to be paid to the underwriters represent            % of the total amount of the offering. The following table shows the per ADS and total underwriting

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discounts and commissions to be paid to the underwriters by us. Such amounts are shown assuming both no exercise and full exercise of the underwriters' option to purchase additional ADSs.

	Per ADS
	Full exercise	No exercise	Total
Discounts and commissions paid by us	US$	US$	US$

        The estimated offering expenses payable by us, exclusive of the underwriting discounts and commissions, are approximately US$                         million, which includes legal, accounting and printing costs and various other fees associated with the registration of our ordinary shares and ADSs.

Conflict of Interest

        Certain affiliates of Goldman Sachs (Asia) L.L.C. beneficially own 10% or more of our ordinary shares. Goldman Sachs (Asia) L.L.C. is an underwriter in this offering and Goldman, Sachs & Co. will be deemed to have a "conflict of interest" within the meaning of Rule 5121 of the Financial Industry Regulatory Authority, Inc. Accordingly, this offering will be made in compliance with the applicable provisions of Rule 5121, which requires that a "qualified independent underwriter" meeting certain standards participate in the preparation of the registration statement and prospectus and exercise the usual standards of due diligence with respect thereto. Citigroup Global Markets Inc. has agreed to act as a "qualified independent underwriter" within the meaning of Rule 5121 in connection with this offering. Goldman, Sachs & Co. will not confirm sales of the shares to any account over which they exercise discretionary authority without the prior written approval of the customer.

Lock-Up Agreements

        We have agreed that, without the prior written consent of the representatives on behalf of the underwriters and subject to certain exceptions, we will not, during the period ending 180 days after the date of this prospectus, (i) issue, offer, pledge, sell, contract to sell, offer or issue, contract to purchase or grant any option, right or warrant to purchase, or otherwise dispose of, any ordinary shares or ADSs or any securities convertible into or exercisable or exchangeable for such ordinary shares or ADSs or enter into a transaction which would have the same effect; (ii) enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the ordinary shares or ADSs; (iii) establish or increase a put equivalent position or liquidate or decrease a call equivalent position in the ordinary shares or ADSs within the meaning of Section 16 of the Exchange Act; (iv) file any registration statement with the SEC relating to the offering of any ordinary shares, ADSs or any securities convertible into or exercisable or exchangeable for ordinary shares or ADSs; or (v) publicly disclose the intention to make any offer, sale, pledge, disposition or filing, in each case regardless of whether any such transaction described above is to be settled by delivery of ordinary shares, ADSs or such other securities, in cash or otherwise.

        Each of our directors and executive officers and current shareholders has agreed that, without the prior written consent of the representatives on behalf of the underwriters and subject to certain exceptions, it will not, during the period ending 180 days after the date of this prospectus, (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of directly or indirectly, any ordinary shares or ADSs or any securities convertible into or exercisable or exchangeable for such ordinary shares or ADSs, (ii) enter into a transaction which would have the same effect or enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the ordinary shares, ADSs or any of our securities that are substantially similar to the ADSs or ordinary shares or any options or warrants to purchase any of the ADSs or ordinary shares or any securities convertible into, exchangeable for or that represent the right to receive the ADSs or ordinary shares, whether now owned or hereinafter acquired, owned directly by it or with respect to which it has beneficial ownership within the rules and regulations of the SEC,

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whether any of these transaction is to be settled by delivery of ordinary shares or ADSs or such other securities, in cash or otherwise or (iii) publicly disclose the intention to make any such offer, sale, pledge or disposition, or enter into any such transaction, swap, hedge or other arrangement.

Listing

        We have applied to list the ADSs on the NASDAQ Global Market under the symbol "GSUM."

Stabilization, Short Positions and Penalty Bids

        In connection with the offering, the underwriters may purchase and sell ADSs in the open market. These transactions may include short sales in accordance with Regulation M under the Exchange Act, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of ADSs than they are required to purchase in the offering. "Covered" short sales are sales made in an amount not greater than the underwriters' option to purchase additional ADSs in the offering. The underwriters may close out any covered short position by either exercising their option to purchase additional ADSs or purchasing ADSs in the open market. In determining the source of ADSs to close out the covered short position, the underwriters will consider, among other things, the price of ADSs available for purchase in the open market as compared to the price at which they may purchase additional ADSs pursuant to the option granted to them. "Naked" short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing ADSs in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the ADSs in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for, or purchases of, ADSs made by the underwriters in the open market prior to the completion of the offering.

        The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased ADSs sold by, or for the account of, such underwriter in stabilizing or short covering transactions.

        Purchases to cover a short position and stabilizing transactions, as well as other purchases by the underwriters for their own accounts, may have the effect of preventing or retarding a decline in the market price of the ADSs, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the ADSs. As a result, the price of the ADSs may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they are required to be conducted in accordance with applicable laws and regulations, and they may be discontinued at any time. These transactions may be effected on the NASDAQ Stock Market, the over-the-counter market or otherwise.

Electronic Distribution

        A prospectus in electronic format will be made available on the websites maintained by one or more of the underwriters or one or more securities dealers. One or more of the underwriters may distribute prospectuses electronically. The underwriters may agree to allocate a number of ADSs for sale to their online brokerage account holders. ADSs to be sold pursuant to an internet distribution will be allocated on the same basis as other allocations. In addition, ADSs may be sold by the underwriters to securities dealers who resell ADSs to online brokerage account holders.

Indemnification

        We have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act.

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Relationships

        Some of the underwriters and their affiliates may in the future engage in investment banking and other commercial dealings in the ordinary course of business with us and our affiliates.

        Affiliates of Goldman Sachs (Asia) L.L.C. currently hold 2,209,925 of our Series C convertible preferred shares, which will be converted into 2,209,925 shares of our Class B ordinary shares immediately upon the completion of this offering. Pursuant to FINRA Rule 5110(g)(1), such securities may not be sold during this offering or sold, transferred, assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of the shares for a period of 180 days immediately following the date of effectiveness of this offering or commencement of sales of this offering.

Pricing of the Offering

        Prior to this offering, there has been no public market for our ordinary shares or ADSs. The initial public offering price will be determined by negotiations between us and the representatives of the underwriters. Among the factors to be considered in determining the initial public offering price of the ADSs, in addition to prevailing market conditions, will be our historical performance, estimates of our business potential and earnings prospects, an assessment of our management and the consideration of the above factors in relation to market valuation of companies in related businesses.

        In addition, non-corporate U.S. Holders will not be eligible for reduced rates of taxation on any dividends received from us if we are a PFIC in the taxable year in which such dividends are paid or in the preceding taxable year.

        If we are a PFIC for any taxable year during which you hold the ADSs or Class B ordinary shares and any of our non-United States subsidiaries is also a PFIC, a U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier PFIC for purposes of the application of these rules. You are urged to consult your tax advisors about the application of the PFIC rules to any of our subsidiaries.

Selling Restrictions

        No action has been taken in any jurisdiction (except in the United States) that would permit a public offering of the ADSs, or the possession, circulation or distribution of this prospectus or any other material relating to us or the ADSs in any jurisdiction where action for that purpose is required. Accordingly, the ADSs may not be offered or sold, directly or indirectly, and neither this prospectus nor any other material or advertisements in connection with the ADSs may be distributed or published, in or from any country or jurisdiction except in compliance with any applicable laws, rules and regulations of any such country or jurisdiction.

Cayman Islands

        This prospectus does not constitute a public offer of the ADSs or ordinary shares, whether by way of sale or subscription, in the Cayman Islands. ADSs or ordinary shares have not been offered or sold and will not be offered or sold, directly or indirectly, in the Cayman Islands.

European Economic Area

        In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), with effect from and including the date on which the Prospectus Directive was implemented in that Relevant Member State (the Relevant Implementation Date), an offer of the ADSs to the public may not be made in that Relevant Member State prior to the publication of a prospectus in relation to the ADSs which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in

165

accordance with the Prospectus Directive, except that, with effect from and including the Relevant Implementation Date, an offer of ADSs may be made to the public in that Relevant Member State at any time:

(a)

to any legal entity which is a qualified investor as defined under the Prospectus Directive;



(b)

to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive); or



(c)

in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities described in this prospectus shall result in a requirement for the publication by us of a prospectus pursuant to Article 3 of the Prospectus Directive.

        For the purposes of this provision, the expression "an offer of the ADSs to the public" in relation to any ADS in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the ADSs to be offered so as to enable an investor to decide to purchase or subscribe the ADSs, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State. The expression Prospectus Directive means Directive 2003/71/EC (and any amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State) and includes any relevant implementing measure in each Relevant Member State, and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.

Hong Kong

        The ADSs may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), (ii) to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules promulgated thereunder or (iii) in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the ADSs may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to ADSs which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules promulgated thereunder.

Japan

        ADSs will not be offered or sold directly or indirectly in Japan or to, or for the benefit of any Japanese person or to others, for re-offering or re-sale directly or indirectly in Japan or to any Japanese person, except in each case pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Securities and Exchange Law of Japan and any other applicable laws, rules and regulations of Japan. For purposes of this paragraph, "Japanese person" means any person resident in Japan, including any corporation or other entity organized under the laws of Japan.

Kuwait

        Unless all necessary approvals from the Kuwait Ministry of Commerce and Industry required by Law No. 31/1990 "Regulating the Negotiation of Securities and Establishment of Investment Funds," its Executive Regulations and the various Ministerial Orders issued pursuant thereto or in connection therewith, have been given in relation to the marketing and sale of the ADSs, these may not be marketed, offered for sale, nor sold in the State of Kuwait. Neither this prospectus (including any

166

related document), nor any of the information contained therein is intended to lead to the conclusion of any contract of whatsoever nature within Kuwait.

People's Republic of China

        This prospectus may not be circulated or distributed in the PRC and the ADSs may not be offered or sold and will not offer or sell to any person for re-offering or resale directly or indirectly to any resident of the PRC except pursuant to applicable laws, rules and regulations of the PRC. For the purpose of this paragraph only, the PRC does not include Taiwan and the special administrative regions of Hong Kong and Macau.

Qatar

        In the State of Qatar, the offer contained herein is made on an exclusive basis to the specifically intended recipient thereof, upon that person's request and initiative, for personal use only and shall in no way be construed as a general offer for the sale of securities to the public or an attempt to do business as a bank, an investment company or otherwise in the State of Qatar. This prospectus and the underlying securities have not been approved or licensed by the Qatar Central Bank or the Qatar Financial Centre Regulatory Authority or any other regulator in the State of Qatar. The information contained in this prospectus shall only be shared with any third parties in Qatar on a need to know basis for the purpose of evaluating the contained offer. Any distribution of this prospectus by the recipient to third parties in Qatar beyond the terms hereof is not permitted and shall be at the liability of such recipient.

Saudi Arabia

        This prospectus may not be distributed in the Kingdom of Saudi Arabia except to such persons as are permitted under the Offers of Securities Regulations issued by the Capital Market Authority. The Capital Market Authority does not make any representation as to the accuracy or completeness of this prospectus and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this prospectus. Prospective purchasers of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this prospectus you should consult an authorized financial adviser.

Singapore

        This prospectus or any other offering material relating to the ADSs has not been registered as a prospectus with the Monetary Authority of Singapore under the Securities and Futures Act, Chapter 289 of Singapore, or the SFA. Accordingly, (a) the ADSs have not been, and will not be, offered or sold or made the subject of an invitation for subscription or purchase of such ADSs in Singapore, and (b) this prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the ADSs have not been and will not be circulated or distributed, whether directly or indirectly, to the public or any member of the public in Singapore other than (i) to an institutional investor as specified in Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275 of the SFA) and in accordance with the conditions specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

United Arab Emirates

        The ADSs have not been offered or sold, and will not be offered or sold, directly or indirectly, in the United Arab Emirates, except: (1) in compliance with all applicable laws and regulations of the United Arab Emirates; and (2) through persons or corporate entities authorized and licensed to provide investment advice and/or engage in brokerage activity and/or trade in respect of foreign

167

securities in the United Arab Emirates. The information contained in this prospectus does not constitute a public offer of securities in the United Arab Emirates in accordance with the Commercial Companies Law (Federal Law No. 8 of 1984 (as amended)) or otherwise and is not intended to be a public offer and is addressed only to persons who are sophisticated investors.

United Kingdom

        This prospectus is only being distributed to and is only directed at: (1) persons who are outside the United Kingdom; (2) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (3) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons falling within (1)-(3) together being referred to as "relevant persons"). The ADSs are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire the ADSs will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this prospectus or any of its contents.

168

EXPENSES RELATED TO THIS OFFERING

        Set forth below is an itemization of the total expenses, excluding underwriting discounts and commissions, which are expected to be incurred in connection with the offer and sale of the ADSs by us. With the exception of the SEC registration fee and the Financial Industry Regulatory Authority filing fee, all amounts are estimates.

SEC registration fee	US$
Stock exchange listing fee
Financial Industry Regulatory Authority filing fee
Printing and engraving expenses
Legal fees and expenses
Accounting fees and expenses
Miscellaneous
Total	US$

169

LEGAL MATTERS

        We are being represented by Fenwick & West LLP with respect to certain legal matters as to U.S. federal securities and New York State law. Certain legal matters with respect to U.S. federal and New York State law in connection with this offering will be passed upon for the underwriters by Simpson Thacher & Bartlett LLP. The validity of the Class B ordinary shares represented by the ADSs offered in this offering and other certain legal matters as to Cayman Islands law will be passed upon for us by Travers Thorp Alberga. Legal matters as to PRC law will be passed upon for us by Commerce & Finance Law Offices and for the underwriters by Jingtian & Gongcheng. Fenwick & West LLP may rely upon Travers Thorp Alberga with respect to matters governed by Cayman Islands law and Commerce & Finance Law Offices with respect to matters governed by PRC law. Simpson Thacher & Bartlett LLP may rely upon Jingtian & Gongcheng with respect to matters governed by PRC law.

170

EXPERTS

        The consolidated financial statements as of December 31, 2013, 2014 and 2015, and for each of the three years in the period ended December 31, 2015, included in this prospectus have been so included in reliance on the report of PricewaterhouseCoopers Zhong Tian LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

        The registered business address of PricewaterhouseCoopers Zhong Tian LLP is 6/F DBS Bank Tower, 1318, Lu Jia Zui Ring Road, Pudong New Area, Shanghai, People's Republic of China.

171

WHERE YOU CAN FIND ADDITIONAL INFORMATION

        We have filed with the SEC a registration statement on Form F-1, including relevant exhibits, under the Securities Act with respect to the underlying Class B ordinary shares represented by the ADSs to be sold in this offering. We have also filed with the SEC a related registration statement on Form F-6 to register the ADSs. This prospectus, which constitutes a part of the registration statement on Form F-1, does not contain all of the information contained in the registration statement. You should read our registration statements and their exhibits and schedules for further information with respect to us and the ADSs.

        The agreements included as exhibits to the registration statement on Form F-1 contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties were made solely for the benefit of the other parties to the applicable agreement and (i) were not intended to be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; (ii) may have been qualified in such agreement by disclosures that were made to the other party in connection with the negotiation of the applicable agreement; (iii) may apply contract standards of "materiality" that are different from "materiality" under the applicable securities laws; and (iv) were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement.

        Immediately upon effectiveness of the registration statement to which this prospectus is a part we will become subject to periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be required to file reports, including annual reports on Form 20-F, and other information with the SEC. As a foreign private issuer, we are exempt from the rules of the Exchange Act prescribing the furnishing and content of proxy statements to shareholders, and from Section 16 short swing profit reporting for our officers and directors and for holders of more than 10% of our ordinary shares. All information filed with the SEC can be obtained over the internet at the SEC's website at www.sec.gov or inspected and copied at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 or visit the SEC website for further information on the operation of the public reference rooms.

172

Gridsum Holding Inc.

Index to Consolidated Financial Statements

	Page
Audited Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets as of December 31, 2013, 2014 and 2015	F-3
Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 2013, 2014 and 2015	F-6
Consolidated Statements of Changes in Shareholders' Deficit for the Years Ended December 31, 2013, 2014 and 2015	F-7
Consolidated Statements of Cash Flows for the Years Ended December 31, 2013, 2014 and 2015	F-8
Notes to the Consolidated Financial Statements for the Years Ended December 31, 2013, 2014 and 2015	F-9
Unaudited Interim Consolidated Financial Statements
Unaudited Interim Consolidated Balance Sheets as of December 31, 2015 and June 30,  2016	F-47
Unaudited Interim Consolidated Statements of Operations and Comprehensive Loss for the Six Months Ended June 30, 2015 and 2016	F-50
Unaudited Interim Consolidated Statements of Changes in Shareholders' Deficit for the Six Months Ended June 30, 2015 and 2016	F-51
Unaudited Interim Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2015 and 2016	F-52
Notes to Unaudited Interim Consolidated Financial Statements for the Six Months Ended June 30, 2015 and 2016	F-53

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Gridsum Holding Inc.:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations and comprehensive loss, of shareholders' deficit and of cash flows present fairly, in all material respects, the financial position of Gridsum Holding Inc. and its subsidiaries at December 31, 2013, 2014 and 2015, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2015 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers Zhong Tian LLP

Beijing, the People's Republic of China
March 9, 2016, except for note 2(a) and note (d), which is as of August 19, 2016

F-2

Gridsum Holding Inc.

CONSOLIDATED BALANCE SHEETS

As of December 31, 2013, 2014 and 2015
(In thousands, except for share and per share data)

	As of December 31,
	2013		2014		2015		2015
	RMB		RMB		RMB		US$ Note 2(e)
ASSETS
Current assets:
Cash and cash equivalents		77,960		61,830		198,523		29,871
Accounts receivable, net		64,577		88,256		279,537		42,062
Prepayments and other current assets		48,355		51,426		107,046		16,107
Total current assets		190,892		201,512		585,106		88,040
Non-current assets:
Property, equipment and software, net		7,742		26,085		36,243		5,453
Other non-current assets		—		—		4,558		686
Total non-current assets		7,742		26,085		40,801		6,139
Total assets		198,634		227,597		625,907		94,179
LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' (DEFICIT)/EQUITY
Current liabilities:
Short-term bank loan (including short-term bank loan of the consolidated VIEs without recourse to the primary beneficiaries of nil, RMB4,000 and nil as of December 31, 2013, 2014 and 2015, respectively)		—		4,000		—		—
Accounts payable (including accounts payable of the consolidated VIEs without recourse to the primary beneficiaries of RMB59,677, RMB21,131 and RMB103,289 as of December 31, 2013, 2014 and 2015, respectively)		59,677		21,131		103,289		15,542
Amounts due to related parties (including amounts due to related parties of the consolidated VIEs without recourse to the primary beneficiaries of RMB436, RMB303 and nil as of December 31, 2013, 2014 and 2015, respectively)		436		313		—		—
Salary and welfare payables (including salary and welfare payables of the consolidated VIEs without recourse to the primary beneficiaries of RMB11,347, RMB17,338 and RMB32,887 as of December 31, 2013, 2014 and 2015, respectively)		11,347		18,144		33,539		5,047
Taxes payable (including taxes payable of the consolidated VIEs without recourse to the primary beneficiaries of RMB579, RMB2,136 and RMB16,484 as of December 31, 2013, 2014 and 2015, respectively)		579		2,136		16,484		2,480

F-3

Gridsum Holding Inc.

CONSOLIDATED BALANCE SHEETS (continued)

As of December 31, 2013, 2014 and 2015
(In thousands, except for share and per share data)

	As of December 31,
	2013		2014		2015		2015
	RMB		RMB		RMB		US$ Note 2(e)
Deferred revenues (including deferred revenues of the consolidated VIEs without recourse to the primary beneficiaries of RMB7,769, RMB18,375 and RMB31,308 as of December 31, 2013, 2014 and 2015, respectively)		7,769		18,375		31,308		4,711
Advance from customers (including advance from customers of the consolidated VIEs without recourse to the primary beneficiaries of RMB11,345, RMB64,753 and RMB104,605 as of December 31, 2013, 2014 and 2015, respectively)		11,345		64,753		104,605		15,740
Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to the primary beneficiaries of RMB30,829, RMB53,293 and RMB68,454 as of December 31, 2013, 2014 and 2015, respectively)		30,829		53,340		70,908		10,667
Total current liabilities		121,982		182,192		360,133		54,187
Total liabilities		121,982		182,192		360,133		54,187
Commitments and contingencies (Note 16)
Mezzanine equity:
Series A convertible preferred shares (US$0.001 par value; 3,125,000 shares authorized, issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		35,113		37,216		40,181		6,046
Series A-1 convertible preferred shares (US$0.001 par value; 1,302,084 shares authorized, issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		24,680		26,273		28,492		4,287
Series B convertible preferred shares (US$0.001 par value; 2,962,239 shares authorized, issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		103,531		113,452		126,641		19,056

F-4

Gridsum Holding Inc.

CONSOLIDATED BALANCE SHEETS (continued)

As of December 31, 2013, 2014 and 2015
(In thousands, except for share and per share data)

	As of December 31,
	2013			2014			2015			2015
	RMB			RMB			RMB			US$ Note 2(e)
Series C convertible preferred shares (US$0.001 par value; nil, nil and 4,640,843 shares authorized, issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		—			—			280,704			42,237
Total mezzanine equity		163,324			176,941			476,018			71,626
Shareholders' (deficit)/equity:
Ordinary shares (US$0.001 par value; 42,610,677 shares authorized, 10,000,000, 10,000,000 and nil shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		68			68			—			—
Ordinary shares—Class A (US$0.001 par value; nil, nil and 4,543,461 shares authorized, issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		—			—			31			5
Ordinary shares—Class B (US$0.001 par value; nil, nil and 33,426,373 shares authorized, nil, nil and 5,456,539 shares , issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		—			—			37			6
Additional paid-in capital		8,034			2,436			—			—
Accumulated other comprehensive income/(loss)		2,326			320			(19,052	)		(2,867	)
Accumulated deficit		(97,100	)		(134,360	)		(191,644	)		(28,836	)
Total Gridsum's shareholders' deficit		(86,672	)		(131,536	)		(210,628	)		(31,692	)
Noncontrolling interests		—			—			384			58
Total shareholders' deficit		(86,672	)		(131,536	)		(210,244	)		(31,634	)
Total liabilities, mezzanine equity and shareholders' (deficit)/equity		198,634			227,597			625,907			94,179

The accompanying notes are an integral part of these consolidated financial statements.

F-5

Gridsum Holding Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Years Ended December 31, 2013, 2014 and 2015
(In thousands, except for share and per share data)

	For the Year Ended December 31
	2013			2014			2015			2015
	RMB			RMB			RMB			US$ Note 2(e)
Revenues:
Enterprise		57,025			104,891			208,157			31,321
e-Government and other		6,414			21,340			29,467			4,434
Less: Business tax and surcharges		(892	)		(1,711	)		(2,785	)		(419	)
Net revenues		62,547			124,520			234,839			35,336
Cost of revenues(1)		(13,810	)		(21,143	)		(35,237	)		(5,302	)
Gross profit		48,737			103,377			199,602			30,034
Operating expenses(1):
Sales and marketing expenses		(29,012	)		(46,880	)		(84,548	)		(12,722	)
Research and development expenses		(20,385	)		(38,137	)		(100,186	)		(15,075	)
General and administrative expenses		(30,276	)		(54,931	)		(60,540	)		(9,109	)
Total operating expenses		(79,673	)		(139,948	)		(245,274	)		(36,906	)
Losses from operations		(30,936	)		(36,571	)		(45,672	)		(6,872	)
Other income/(expense):
Foreign currency exchange gain/(loss)		296			(766	)		1,339			201
Interest income, net		87			180			80			12
Other income, net		9			373			111			17
Loss before income tax		(30,544	)		(36,784	)		(44,142	)		(6,642	)
Income tax expense		(130	)		(476	)		(4,693	)		(706	)
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)
Less: Net loss attributable to noncontrolling interests		—			—			(16	)		(2	)
Net loss attribute to Gridsum Holding Inc.		(30,674	)		(37,260	)		(48,819	)		(7,346	)
Accretion to preferred shares redemption value		(3,849	)		(9,480	)		(19,707	)		(2,965	)
Cumulative dividend to preferred shareholders		(8,215	)		(16,327	)		(16,642	)		(2,504	)
Net loss attributable to Gridsum's ordinary shareholders		(42,738	)		(63,067	)		(85,168	)		(12,815	)
Net loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)
Foreign currency translation adjustment, net of nil tax		850			(2,006	)		(19,372	)		(2,915	)
Comprehensive loss		(29,824	)		(39,266	)		(68,207	)		(10,263	)
Comprehensive loss attributable to Gridsum Holding Inc.		(29,824	)		(39,266	)		(68,207	)		(10,263	)
Net loss per share attributable to Gridsum's ordinary shareholders, basic and diluted		(4.27	)		(6.31	)		(8.52	)		(1.28	)
Weighted average shares outstanding used in computing net income per share attributable to Gridsum's ordinary shareholders		10,000,000			10,000,000			10,000,000			10,000,000

Note:

(1)

Share-based compensation expenses were allocated in cost of revenues and operating expenses as follows:

Cost of revenues	32	71	335	50
Sales and marketing expenses	86	370	1,651	248
Research and development expenses	163	449	3,347	504
General and administrative expenses	2,013	2,992	3,473	523

The accompanying notes are an integral part of these consolidated financial statements.

F-6

Gridsum Holding Inc.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT

For the Years Ended December 31, 2013, 2014 and 2015
(In thousands, except for share and per share data)

	Ordinary Shares							Accumulated Other Comprehensive Income/(Loss)
					Additional Paid-in Capital						Accumulated Deficit			Noncontrolling Interests			Total Shareholders' Deficit
	Shares		Amount
			RMB		RMB			RMB			RMB			RMB			RMB
Balances as of January 1, 2013		10,000,000		68		9,589			1,476			(66,426	)		—			(55,293	)
Preferred shares accretion		—		—		(3,849	)		—			—			—			(3,849	)
Share-based compensation expenses		—		—		2,294			—			—			—			2,294
Net loss		—		—		—			—			(30,674	)		—			(30,674	)
Foreign currency translation adjustment, net of tax		—		—		—			850			—			—			850
Balances as of December 31, 2013		10,000,000		68		8,034			2,326			(97,100	)		—			(86,672	)
Preferred shares accretion		—		—		(9,480	)		—			—			—			(9,480	)
Share-based compensation expenses		—		—		3,882			—			—			—			3,882
Net loss		—		—		—			—			(37,260	)		—			(37,260	)
Foreign currency translation adjustments, net of tax		—		—		—			(2,006	)		—			—			(2,006	)
Balances as of December 31, 2014		10,000,000		68		2,436			320			(134,360	)		—			(131,536	)
Preferred shares accretion		—		—		(11,242	)		—			(8,465	)		—			(19,707	)
Share-based compensation expenses		—		—		8,806			—			—			—			8,806
Net loss		—		—		—			—			(48,819	)		(16	)		(48,835	)
Capital injection in a subsidiary by noncontrolling interests shareholder		—		—		—			—			—			400			400
Foreign currency translation adjustments, net of tax		—		—		—			(19,372	)		—			—			(19,372	)
Balances as of December 31, 2015		10,000,000		68		—			(19,052	)		(191,644	)		384			(210,244	)

The accompanying notes are an integral part of these consolidated financial statements.

F-7

Gridsum Holding Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, except for share and per share data)

	For the Year Ended December 31,
	2013			2014			2015			2015
	RMB			RMB			RMB			US$
Cash flows from operating activities:
Net Loss		(30,674	)		(37,260	)		(48,835	)		(7,348	)
Adjustments to reconcile net loss to net cash (used in)/provided by operating activities:
Provision for allowance for doubtful accounts		25			67			1,172			176
Share-based compensation expenses		2,294			3,882			8,806			1,325
Depreciation and amortization expenses		3,746			7,037			13,048			1,963
Foreign currency exchange gain/(loss), net		319			113			(1,444	)		(217	)
Loss on disposal of equipment and leasehold improvements		—			—			350			53
Changes in operating assets and liabilities:
Accounts receivable		(33,746	)		(23,746	)		(192,453	)		(28,958	)
Prepayments and other current assets		(20,703	)		(2,381	)		(59,441	)		(8,944	)
Accounts payable		22,085			(38,546	)		82,158			12,362
Amounts due to related parties		(577	)		(123	)		(313	)		(47	)
Salary and welfare payable		5,564			6,790			15,393			2,316
Taxes payable		(536	)		1,557			14,348			2,159
Deferred revenues		2,364			10,606			12,933			1,946
Advance from customers		(3,699	)		53,408			39,852			5,996
Accrued expenses and other current liabilities		9,112			23,369			14,586			2,195
Net cash (used in)/provided by operating activities		(44,426	)		4,773			(99,840	)		(15,023	)
Cash flows from investing activities:
Purchase of property, equipment and software		(6,812	)		(25,931	)		(20,705	)		(3,115	)
Net cash used in investing activities		(6,812	)		(25,931	)		(20,705	)		(3,115	)
Cash flows from financing activities:
Proceeds from issuance of Series B preferred shares		107,100			—			—			—
Payment of financing costs in connection with the issuance of Series B preferred shares		(4,166	)		—			—			—
Proceeds from issuance of Series C preferred shares		—			—			262,561			39,507
Payment of financing costs in connection with the issuance of Series C preferred shares		—			—			(1,061	)		(160	)
Proceeds of bank loan		—			4,000			—			—
Repayment of bank loan		—			—			(4,000	)		(602	)
Net cash provided by financing activities		102,934			4,000			257,500			38,745
Effect of exchange rate changes on cash and cash equivalents		(2,385	)		1,028			(262	)		(39	)
Net increase/(decrease) in cash and cash equivalents		49,311			(16,130	)		136,693			20,568
Cash and cash equivalents at the beginning of the year		28,649			77,960			61,830			9,303
Cash and cash equivalents at the end of the year		77,960			61,830			198,523			29,871
Supplemental disclosures of cash flow information:
Cash paid for income taxes		—			130			476			72
Supplemental schedule of non-cash investing activities:
Fixed asset purchases financed by accrued expenses and other current liabilities		280			280			3,176			478
Supplemental schedule of non-cash financing activities:
Accretions to preferred shares redemption value		3,849			9,480			19,707			2,965

The accompanying notes are an integral part of these consolidated financial statements.

F-8

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except for share and per share data)

1. Organization and Principal Activities

(a)

Principal activities

        Gridsum Holding Inc. ("Company"), through its consolidated subsidiaries and variable interest entities ("VIEs") (collectively referred to as the "Group"), provides digital intelligence solutions in the People's Republic of China ("PRC").

        The accompanying consolidated financial statements include the financial statements of the Company, its subsidiaries, VIEs and VIE subsidiaries. As of December 31, 2015, the Company's operating subsidiaries, operating VIE and operating VIE subsidiaries were as follows:

Operating Subsidiaries	Equity interests held		Place and Date of Incorporation
Gridsum Holding (China) Limited		100%	Hong Kong, July 2014
Dissector (Beijing) Technology Co., Ltd.		100%	PRC, October 2014

Operating VIE	Economic interests held		Place and Date of Incorporation
Gridsum Holding (Beijing) Co., Ltd.		100%	PRC, August 2014

Operating VIE Subsidiaries	Economic interests held		Place and Date of Incorporation
Beijing Gridsum Technology Co., Ltd.		100%	PRC, December 2005
Beijing Moment Everlasting Ad Co., Ltd.		100%	PRC, January 2011
Guoxinjunhe (Beijing) Technology Co., Ltd.		100%	PRC, April 2012
Beijing Yunyang Advertisement Co., Ltd.		100%	PRC, March 2013
Beijing Guoxinwangyan Technology Co., Ltd.		80%	PRC, August 2015

(b)

Reorganization

        The Company was incorporated in the Cayman Islands on July 21, 2014.

        The Group began operations in December 2005 through Beijing Gridsum Technology Co., Ltd. ("Beijing Gridsum"), a PRC domestic company established by our founders. Beijing Gridsum established two wholly owned subsidiaries, Beijing Moment Everlasting Ad Co., Ltd. ("Beijing Moment") and Guoxinjunhe (Beijing) Technology Co., Ltd. ("Guoxinjunhe"), in January 2011 and April 2012, respectively. Beijing Moment established a wholly owned subsidiary, Beijing Yunyang Ad Co., Ltd. ("Beijing Yunyang") in March 2013.

        From July to December 2014, the Group undertook a reorganization ("2014 Restructuring") and established the Company under the laws of the Cayman Islands; the Company established a wholly owned Hong Kong subsidiary, Gridsum Holding (China) Limited ("Gridsum HK"), which in turn established a wholly owned subsidiary in China, Dissector (Beijing) Technology Co. Ltd. ("WFOE"). Also as part of this 2014 Restructuring, Gridsum Holding (Beijing) Co., Ltd. ("Gridsum PRC Holding") was established to acquire full ownership of Beijing Gridsum, Beijing Moment and Guoxinjunhe from Beijing Gridsum.

F-9

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

        On December 22, 2014, the WFOE entered into a series of contractual agreements ("VIE agreements") with Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, as a result of which Gridsum PRC Holding became a VIE of which the Company is the primary beneficiary, and the Company consolidates the financial results of Gridsum PRC Holding and its subsidiaries. Prior to the 2014 Restructuring, the Group was controlled by a predecessor Cayman Islands entity, which through another restructuring in 2010 ("2010 Restructuring") controlled the Group entities in China according to a set of contractual arrangements containing terms and conditions identical to those of the VIE agreements. The 2010 Restructuring was undertaken in order to facilitate an international financing completed in September 2010 as well as to comply with relevant government regulations and policies in the PRC. The VIE agreements have superseded the 2010 contractual arrangements. Prior to the 2010 Restructuring, the Group's founders and management held 100% of the beneficial ownership interest in Beijing Gridsum. In the 2010 Restructuring, the predecessor Cayman Islands entity was established with the same beneficial ownership structure as Beijing Gridsum. Therefore, the Group's founders and management held 100% of the beneficial ownership interests in, and maintained control of, the Group immediately before and after the 2010 Restructuring.

        In the 2014 Restructuring, the Company was established with the same beneficial ownership structure as the predecessor Cayman Islands entity. Therefore, the Group's founders, management and the then outstanding Preferred Shareholders held 100% of the beneficial ownership interests in, and maintained control of, the Group immediately before and after the 2014 Restructuring.

        The entities included in the 2010 Restructuring and 2014 Restructuring were under common control and the two reorganizations have been accounted for in a manner akin to a pooling of interest as if the Company, through its wholly owned subsidiaries, had been in existence and been the primary beneficiary of the VIEs throughout the periods presented in the consolidated financial statements.

(c)

Contracts with Variable Interest Entities

        To comply with applicable PRC laws and regulations, the Group conducts operations in China principally through Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang and Beijing Guoxinwangyan Technology Co., Ltd. The WFOE has entered into a series of contractual arrangements with the parent of these companies, Gridsum PRC Holding, and the shareholders of Gridsum PRC Holding. These contractual arrangements allow the Company to exercise effective control over Gridsum PRC Holding and to receive substantially all of the economic benefits of Gridsum PRC Holding. As a result of these contractual arrangements, the Company is the primary beneficiary of Gridsum PRC Holding, and the Company treats it as a VIE in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The following is a summary of the currently effective contractual arrangements among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding:

        Exclusive Business Cooperation Agreement.    Under the Exclusive Business Cooperation Agreement dated December 22, 2014, between the WFOE and Gridsum PRC Holding, Gridsum PRC Holding has appointed the WFOE as its exclusive provider of technical support, business support and related consulting services and has agreed to accept all consultations and services provided by the WFOE and, without prior written consent of the WFOE, not to accept the same or any similar consultations and/or services provided by, or establish similar cooperation relationships with, any third party. In

F-10

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

consideration of the services provided by the WFOE, Gridsum PRC Holding has agreed to pay the WFOE, on a quarterly basis, service fees equal to 90% of Gridsum PRC Holding's net income (which equals gross income less mutually agreed costs). The parties can reasonably adjust the calculation of such service fees. The WFOE shall have exclusive and proprietary rights and interests in all rights, ownership, interests and intellectual property owned and used by the WFOE during the performance of the agreement. The term of the agreement is 10 years and may be extended if confirmed in writing by the WFOE prior to expiration (and Gridsum PRC Holding shall unconditionally accept such extension). Gridsum PRC Holding shall not terminate the agreement prior to its expiration, unless the WFOE commits gross negligence or fraudulent act against Gridsum PRC Holding, whereas the WFOE may terminate the agreement upon giving 30 days' prior written notice to Gridsum PRC Holding at any time.

        Exclusive Option Agreements.    Under the Exclusive Option Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding granted to the WFOE an irrevocable and exclusive right to purchase, or designate other person(s) to purchase, to the extent permitted by PRC laws, at any time all or part of such shareholders' equity interests in Gridsum PRC Holding. The purchase price shall be equal to the registered capital of Gridsum PRC Holding multiplied by the portion of equity interests to be purchased and RMB10.00, or, if there is any mandatory provision regarding the purchase price under PRC laws, the lowest price permitted by PRC laws. Without prior written consent of the WFOE, Gridsum PRC Holding shall not: (i) supplement, change or amend its articles of association, increase or decrease its registered capital or change its capital structure in any manner, (ii) sell, transfer, mortgage or dispose of or create security interest on, its assets, business or legal right to collect interests, (iii) create, succeed to, guarantee or permit any debt, except for debts arising in the course of the ordinary or daily business operation, (iv) enter into any material contract (i.e., any contract with a value exceeding RMB1,000,000), or (v) provide loan or credit to Gridsum PRC Holding's shareholders in any form; and the shareholders of Gridsum PRC Holding shall not sell, transfer, mortgage or dispose of or create security interest on, such shareholders' legal or beneficial interest in the equity interests in Gridsum PRC Holding. The term of these agreements is 10 years and may be renewed at the WFOE's election.

        Shareholders' Voting Rights Proxy Agreements.    Under the Shareholders' Voting Rights Proxy Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding irrevocably authorize the WFOE or its designee to act on their behalf as their exclusive agent and attorney with respect to all matters concerning their shareholder rights, including, without limitation, to propose, convene and attend shareholder meetings as the proxy of such shareholders and to exercise all of such shareholder's voting rights provided under PRC laws or the articles of association of Gridsum PRC Holding. Each agreement will remain effective until the equity interest of the respective shareholder in Gridsum PRC Holding is transferred to the WFOE.

        Equity Pledge Agreements.    Under the Equity Pledge Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding pledge all of their equity interests in Gridsum PRC Holding to the WFOE as security for the performance of the obligations of Gridsum PRC Holding and its

F-11

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

shareholders under the Exclusive Business Cooperation Agreement, the Exclusive Option Agreements and the Shareholders' Voting Rights Proxy Agreements. In the event of breach of any secured obligation by Gridsum PRC Holding or the respective shareholder, the WFOE is entitled to all remedial rights and powers afforded under PRC laws, including to receive proceeds from auctions or sale-offs of the pledged equity. No dividend or distribution can be paid or made to the shareholders in respect of the pledged equity unless consented by the WFOE, and the dividends or distributions received by the shareholders shall first be applied to satisfy the secured obligations. The pledges will be released upon the full and complete performance of the secured obligations and the full payment of losses and fees resulted from a breach of those agreements by Gridsum PRC Holding or its shareholders. The equity pledges have been registered with the registration authorities of industry and commerce in accordance with PRC laws.

        In addition to the contractual agreements described above, the Company has entered into an Exclusive Rights Arrangement with the predecessor Cayman Islands entity on December 22, 2014. Under this agreement, the Company exercises effective control over the predecessor Cayman Islands entity and receives substantially all of the economic benefits of the predecessor Cayman Islands entity. As a result of this agreement, the Company is the primary beneficiary of the predecessor Cayman Islands entity, and the Company treats it as a VIE. The Company consolidates the financial results of the predecessor Cayman Islands entity and its subsidiaries in the Company's consolidated financial statements. The following is a summary of the Exclusive Rights Arrangement among the Company, the predecessor Cayman Islands entity and the shareholders of the predecessor Cayman Islands entity that was in effect until termination on August 10, 2015 in connection with the completion of the 2014 Restructuring:

        All the shareholders agreed to irrevocably assign and entrust to the Company any and all of their respective voting rights and dividends rights with respect to any and all of the equity securities they held in the predecessor Cayman Islands entity. All the actions associated with any shareholder's voting rights conducted by the Company shall be deemed as such shareholders' own actions, and all the shareholders' resolutions executed by the Company shall be deemed to be executed by all of the shareholders themselves. Each shareholder agreed to refrain from exercising any of the voting rights associated with its shareholding in the predecessor Cayman Islands entity, all of which have been authorized and entrusted to the Company. If a dividend or other distribution is declared, paid or set aside, each shareholder shall immediately transfer to the Company any and all of such dividend or distribution. No dividend or distribution, whether in cash, in property or in any other equity securities of the predecessor Cayman Islands entity, shall be declared, paid, set aside or made without the written consent of the Company.

Risks in relation to the VIE structure

        In the opinion of the Company's management, the contractual arrangements discussed above have resulted in the Company and the WFOE having the power to direct activities that most significantly impact the VIEs and VIE subsidiaries, including appointing key management, setting up operating policies, exerting financial controls and transferring profit or assets out of the VIEs and VIE subsidiaries at its discretion. The Company and the WFOE believe they have the right to receive all the benefits and assets of the VIEs and VIE subsidiaries, except for registered capital of the VIEs and VIE

F-12

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

subsidiaries totaling RMB16,000, RMB25,000 and RMB124,000 as of December 31, 2013, 2014 and 2015, respectively. As the VIEs and VIE subsidiaries organized in the PRC were established as limited liability companies under PRC law, their creditors do not have recourse to the general credit of the WFOE for the liabilities of these VIEs and VIE subsidiaries, and the WFOE does not have the obligation to assume the liabilities of these VIEs and VIE subsidiaries.

        The Company believes that its contractual arrangements with the VIEs are in compliance with PRC law and are legally enforceable. In addition, the shareholders of Gridsum PRC Holding are also beneficial owners of the Company and therefore have no current interest in seeking to act contrary to the contractual arrangements. However, uncertainties in the PRC legal system could limit the Group's ability to enforce the VIE agreements.

        On January 19, 2015, the Ministry of Commerce ("MOFCOM"), released for public comment a proposed PRC law, the Draft FIE Law, that appears to include VIEs within the scope of entities that could be considered to be foreign invested enterprises, or FIEs, that would be subject to restrictions under existing PRC law on foreign investment in certain categories of industry. Specifically, the Draft FIE Law introduces the concept of "actual control" for determining whether an entity is considered to be an FIE. In addition to control through direct or indirect ownership or equity, the Draft FIE Law includes control through contractual arrangements within the definition of "actual control." If the Draft FIE Law is passed by the People's Congress of the PRC and goes into effect in its current form, these provisions regarding control through contractual arrangements could be construed to reach our VIE arrangements, and as a result our PRC-organized VIEs could become explicitly subject to the current restrictions on foreign investment in certain categories of industry. The Draft FIE Law includes provisions that would exempt from the definition of foreign invested enterprises entities where the ultimate controlling shareholders are either entities organized under PRC law or individuals who are PRC citizens. The Draft FIE Law is silent as to what type of enforcement action might be taken against existing VIEs, such as Gridsum PRC Holding, that operate in restricted or prohibited industries and are not controlled by entities organized under PRC law or individuals who are PRC citizens. If the restrictions and prohibitions on foreign invested enterprises included in the Draft FIE Law are enacted and enforced in their current form, our ability to use our VIE arrangements and our ability to conduct business through them could be severely limited.

        The Company's ability to control Gridsum PRC Holding and its subsidiaries also depends on the WFOE's rights, under the Shareholders' Voting Rights Proxy Agreements, to vote on all matters requiring shareholder approval. As noted above, the Company believes these Shareholders' Voting Rights Proxy Agreements are legally enforceable, but yet they may not be as effective as direct equity ownership. In addition, if the corporate structure of the Group or the contractual arrangements between the WFOE, Gridsum PRC Holding and their respective shareholders were found to be in violation of any existing PRC laws and regulations, the relevant PRC regulatory authorities could:

•

revoke the Group's business and operating licenses;

•

require the Group to discontinue or restrict its operations;

•

restrict the Group's right to collect revenues;

•

block Group websites;

F-13

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

•

require the Group to restructure the operations, re-apply for the necessary licenses or relocate its businesses, staff and assets;

•

impose additional conditions or requirements with which the Group may not be able to comply; or

•

take other regulatory or enforcement actions against the Group that could be harmful to the Group's business.

        The imposition of any of these restrictions or actions may result in a material adverse effect on the Group's ability to conduct its business. In addition, if the imposition of any of these restrictions causes the Company to lose the right to direct the activities of the Gridsum PRC Holding or the right to receive its economic benefits, the Company would no longer be able to consolidate the financial statements of Gridsum PRC Holding and its subsidiaries. The Company believes the likelihood of losing the benefits of the Group's current ownership structure and contractual arrangements with Gridsum PRC Holding is remote based on the current facts and circumstances.

        There is no VIE in which the Group has a variable interest but is not the primary beneficiary. Currently there is no contractual arrangement that could require the Group to provide additional financial support to the VIEs.

        The consolidated financial information of the VIEs and VIE subsidiaries, including the inter-group transactions with other entities in the Group, has been included in the accompanying consolidated financial statements of the Group as follows:

	As of December 31,
	2013		2014		2015
	RMB		RMB		RMB
Cash and cash equivalents		77,960		61,820		166,421
Accounts receivable, net		64,577		88,256		279,537
Prepayments and other current assets		48,355		51,426		100,905
Property, equipment and software, net		7,742		26,085		36,243
Other non-current assets		—		—		4,558
Total assets		198,634		227,587		587,664
Short-term bank loan		—		4,000		—
Accounts payable		59,677		21,131		103,289
Amounts due to related parties		436		303		248,982
Salary and welfare payables		11,347		17,338		32,887
Taxes payable		579		2,136		16,484
Deferred revenues		7,769		18,375		31,308
Advance from customers		11,345		64,753		104,605
Accrued expenses and other current liabilities		30,829		53,293		68,454
Total liabilities		121,982		181,329		606,009

F-14

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

	For the Year Ended December 31,
	2013			2014			2015
	RMB			RMB			RMB
Net revenues		62,547			124,520			278,114
Net (loss)/income		(28,380	)		(32,462	)		55,694

	For the Year Ended December 31,
	2013			2014			2015
	RMB			RMB			RMB
Net cash (used in)/provided by operating activities		(44,426	)		4,773			129,026
Net cash used in investing activities		(6,812	)		(25,931	)		(20,425	)
Net cash provided by/(used in) financing activities		102,934			4,000			(4,000	)

        In accordance with various contractual agreements, the Company has the power to direct the activities of the VIEs and can have assets transferred out of the VIEs. Therefore, the Company considers that there are no assets in the consolidated VIEs that can be used only to settle obligations of the consolidated VIEs, except for registered capital of the VIEs and VIE subsidiaries totaling RMB16,000, RMB25,000 and RMB124,000 as of December 31, 2013, 2014 and 2015, respectively. As the consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors do not have recourse to the general credit of the Company for the liabilities of the consolidated VIEs.

Liquidity

        The Group has been incurring recurring losses from operations since inception. Accumulated losses from operation were RMB97,100, RMB134,360, and RMB183,179 as of December 31, 2013, 2014 and 2015, respectively. The net cash used in operating activities was RMB44,426, provided by operating activities was RMB4,773 and used in operating activities was RMB99,840 for the years ended December 31, 2013, 2014 and 2015, respectively.

        The Group's ability to fund operations is based on its ability to generate cash, its ability to attract investors and its ability to borrow funds on reasonable economic terms. Historically, the Group has relied principally on both operational sources of cash and non-operational sources of financing from investors to fund its operations and business development. The Group's ability to continue as a going concern is dependent on management's ability to successfully execute its business plan, which includes increasing revenues while controlling operating expenses, as well as, generating operational cash flows and continuing to gain support from outside sources of financing. The Group has been continuously receiving financing support from outside investors. The latest round of external capital financing was completed in March 2015 (see Note 11). In addition, if the Company successfully completes a qualified initial public offering before September 2017, thereby triggering the automatic conversion of all series of preferred shares into ordinary shares, it will eliminate the possibility of any future cash outflow that may result from preferred shareholders exercising their share redemption rights. In the event the initial public offering has to be deferred to beyond September 2017, management is of the opinion that the Group will be able to continue to gain the support from its existing investors, and management does not foresee a request for shares redemption from its preferred shareholders. Moreover, the Company can adjust the pace of its expansion and control Group operating expenses. Based on the above

F-15

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

considerations, the Company's consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.

2. Principal Accounting Policies

(a)

Basis of presentation

        The Company's consolidated financial statements have been prepared in accordance with U.S. GAAP. Significant accounting policies followed by the Company in the preparation of the accompanying consolidated financial statements are summarized below.

        Following the issuance of the 2013 and 2014 financial statements, the Company identified errors in the followiing items.

          (i)  An error in the presentation of additional paid-in capital and of accumulated deficit, which was related to the calculation of accretion to preferred shares redemption value in the consolidated balance sheets and consolidated statements of changes in shareholders' deficit. The error was due to accretion to preferred shares redemption value that was incorrectly recorded by increasing the accumulated deficit when additional paid-in capital had not been exhausted as of January 1, 2013, December 31, 2013 and December 31, 2014.

         (ii)  An error in the calculation of cumulative dividend to preferred shareholders, net loss attributable to ordinary shareholders and basic and diluted net loss per share attribute to ordinary shareholders. The error was due to the incorrect calculation of cumulative dividend to preferred shareholders, resulting in an error in calculating net loss attributable to ordinary shareholders and basic and diluted net loss per share attribute to ordinary shareholders for the years ended December 31, 2013 and 2014, respectively.

        The Company has evaluated the impact of these items under the guidance in ASC 250, "Accounting Changes and Error Corrections" and SEC Staff Accounting Bulletin No. 99, "Materiality" and concluded that the errors were not material to the consolidated financial statements. The Company has revised the consolidated financial statements for the fiscal years ended December 31, 2013 and 2014 to reflect the correction of these items. The amounts of the corrections are shown in the Revision column in the tables below.

	As of December 31,
	2013									2014
Consolidated Balance Sheet	As previously reported			Revision			As revised			As previously reported			Revision			As revised
	RMB			RMB			RMB			RMB			RMB			RMB
Shareholders' deficit
Additional paid-in capital		16,005			(7,971	)		8,034			19,887			(17,451	)		2,436
Accumulated deficit		(105,071	)		7,971			(97,100	)		(151,811	)		17,451			(134,360	)

F-16

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

	For the Year Ended December 31,
	2013								2014
Consolidated Statements of Comprehensive Loss	As previously reported			Revision		As revised			As previously reported			Revision		As revised
	RMB			RMB		RMB			RMB			RMB		RMB
Cumulative dividend to preferred shareholders		(19,125	)		10,910		(8,215	)		(35,495	)		19,168		(16,327	)
Net loss attributable to Gridsum's ordinary shareholders		(53,648	)		10,910		(42,738	)		(82,235	)		19,168		(63,067	)
Net loss per share attributable to Gridsum's ordinary shareholders, basic and diluted		(5.36	)		1.09		(4.27	)		(8.22	)		1.91		(6.31	)

(b)

Principles of Consolidation

        The consolidated financial statements of the Company have been prepared in accordance with U.S. GAAP. The consolidated financial statements include the financial statements of the Company, its subsidiaries, VIEs and VIE subsidiaries for which the Company is the ultimate primary beneficiary.

        Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors or to cast a majority of votes at the meeting of directors. A VIE is an entity in which the Company, or its subsidiary, through contractual arrangement exercises effective control over the activities that most impact economic performance and bears the risks of and enjoys the rewards normally associated with ownership of the entity, so that the Company or its subsidiary is the primary beneficiary of the entity. All transactions and balances among the Company, its subsidiaries, VIEs and VIE subsidiaries have been eliminated upon consolidation.

(c)

Use of Estimates

        The preparation of the Company's consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, related disclosures of contingent liabilities at the balance sheet date and the reported revenues and expenses during the reported period in the consolidated financial statements and accompanying notes. Significant accounting estimates include, but are not limited to, revenue recognition, share-based compensation, redemption value of the redeemable preferred shares, realization of deferred tax assets and determination of the estimated useful lives of property and equipment. Actual results could differ materially from such estimates.

F-17

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

(d)

Foreign currency translation

        The Group uses U.S. Dollar as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in Hong Kong is U.S. Dollars, while the functional currency of the other entities in the Group is RMB. In the consolidated financial statements, the financial information of the Company's PRC subsidiaries, the VIEs and VIE subsidiaries, which use RMB as their functional currency, have been translated into U.S. Dollars. Assets and liabilities are translated at the applicable exchange rates on the balance sheet date. Equity amounts are translated at historical exchange rates. Revenues, expenses, gains and losses are translated using the average exchange rate for the periods. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income or loss in the consolidated statement of changes in shareholders' deficit.

        Foreign currency transactions denominated in currencies other than functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are remeasured at the applicable rates of exchange in effect at that date. Foreign exchange gains and losses resulting from the settlement of such transactions and from remeasurement at year-end are recognized in foreign currency exchange gain/(loss), net in the consolidated statements of operations and comprehensive loss.

(e)

Convenience Translation

        Translations of balances in the consolidated balance sheets, consolidated statements of operation and comprehensive loss and statements of cash flows from RMB into U.S. Dollar as of and for the year ended December 31, 2015 are solely for the convenience of the reader and were calculated at the rate of US$1.00 = RMB6.6459, representing the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on June 30, 2016. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into U.S. Dollar at that rate on June 30, 2016, or at any other rate.

(f)

Cash and Cash Equivalents

        Cash and cash equivalents represent cash on hand and demand deposits with term less than three months which are unrestricted as to withdrawal and use.

(g)

Accounts Receivable

        Accounts receivable mainly represent amounts due from customers, including revenues earned, output VAT and amounts paid, or will pay, to search engines on behalf of customers, and are recorded net of an allowance for doubtful accounts, if any. The Company considers many factors in assessing the collectability of its accounts receivable, such as the age of the amounts due, the payment history, credit worthiness and the financial condition of the debtor. The Company also makes a specific allowance if there is strong evidence indicating that an accounts receivable is likely to be unrecoverable. Accounts receivable balances are written off after all collection efforts have been exhausted. The allowance for

F-18

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

doubtful accounts was RMB25, RMB92 and RMB1,264 as of December 31, 2013, 2014 and 2015, respectively.

(h)

Property, Equipment and Software, net

        Property and equipment are stated at cost less accumulated depreciation and amortization and impairment. Property and equipment are depreciated at rates sufficient to write off their costs less impairment and residual value (estimated at 5% of cost) over their estimated useful lives on a straight-line basis. Leasehold improvements are depreciated on a straight-line basis over the period of the lease or their estimated useful lives, if shorter. The estimated useful lives are as follows:

Computers and software	3 years
Furniture, fixtures and equipment	5 years
Vehicles	5 years
Leasehold improvements	Over the shorter of lease terms or the estimated useful lives of assets

        Expenditures for repairs and maintenance are expensed as incurred, whereas the costs of renewals and betterment that extends the useful lives of property and equipment are capitalized as additions to the related assets. Retirements, sales and disposals of assets are recorded by removing the costs, accumulated depreciation and amortization and impairment with any resulting gain or loss recognized in the consolidated statements of operations and comprehensive loss.

(i)

Impairment of Long-lived Assets

        Long-lived assets are evaluated for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be fully recoverable or that the useful life is shorter than the Group had originally estimated. When these events occur, the Group evaluates the impairment for the long-lived assets by comparing the carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. Such assets are considered to be impaired, if the sum of the expected future undiscounted cash flows is less than the carrying value of the assets. The impairment to be recognized is then measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets based on the discounted cash flow. No triggering events and no impairment charge was recognized for any of the periods presented.

(j)

Fair Value

        Fair value represents the price that would be received from selling an asset, or that would be paid to transfer a liability, in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

        Accounting guidance defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. Accounting guidance establishes a three-level fair value hierarchy and requires an entity to maximize the use of observable inputs and minimize the use

F-19

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs are:

Level 1—	Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2—	Other inputs that are directly or indirectly observable in the marketplace.
Level 3—	Unobservable inputs which are supported by little or no market activity.

        Accounting guidance also describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach; and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset.

        Financial assets and liabilities of the Group primarily consist of cash and cash equivalents, accounts receivable, prepayments and other current assets, accounts payable, amounts due to related parties, taxes payable, advances from customers and accrued expenses and other current liabilities. As of December 31, 2013, 2014 and 2015, the carrying values of these financial instruments approximated their fair values due to the short-term maturity of these instruments.

(k)

Revenue Recognition

        Revenues are generated from sales of the Company's marketing automation solutions and e-Government and other solutions. The targeted customers for marketing automation solutions are enterprise customers and the targeted customers for e-Government and other solutions are governmental agencies and state-owned entities.

        Revenues are recognized when:

•

persuasive evidence of an arrangement exists;

•

the Group's platform is made available and services have been delivered to the customer;

•

the fee is fixed or determinable; and

•

collection is reasonably assured.

        Revenues received from the incentive programs of search engine providers are based on factors determined by these providers, such as yearly growth in the amount of advertising on the provider's search engine platform that the Company's customers purchase through its solutions, and other factors selected at the discretion of these providers. Revenues are recorded net of value-added taxes and surcharges.

        In accordance with ASC 605-45, Revenue Recognition: Principal Agent Considerations, the Company considers several factors in determining whether it acts as the principal or as an agent in the arrangement of merchandise sales and provision of various related services and thus whether it is

F-20

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

appropriate to record the revenues and the related cost of sales on a gross basis or record the net amount earned as service fees.

        Where customers purchase multiple solutions in a single contract, the Company allocates the total consideration to the various elements based on the relative selling price method and recognizes revenues as services are rendered. In accordance with ASC 605-25, Revenue Recognition—Multiple- Element Arrangements, the following hierarchy are followed when determining the appropriate selling price for each element: (1) vendor specific objective evidence ("VSOE"), (2) third party evidence ("TPE") and (3) best estimate of selling price ("BESP"). The Company recognizes revenues on the elements delivered and defers the recognition of revenues for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, revenues are recognized on a straight line basis over the contract period.

Enterprise

        The Company generates enterprise revenue primarily by providing marketing automation solutions including bid management and data analysis solutions to enterprise customers. The Company earns and records service fee revenues over the contractual period, in proportion to ad spending or the completion of milestones that are stipulated in the contracts. In addition, the Company receives revenues from the incentive programs of search engine providers based on factors determined by these providers, such as yearly growth in the amount of advertising on the provider's search engine platform that the Company's customers purchase through its solutions, and other factors selected at the discretion of these providers. Revenues from these programs are received on both a quarterly and an annual basis and are calculated in accordance with the Company's customers' usage of the search engine providers.

        With respect to the bid management services, the Group considered that: (i) the search engines are responsible for providing the advertisements service to the customers; (ii) the Group lacks the latitude to determine the prices charged by the search engine providers and earns only the fixed service fee from the customers; (iii) the hosting and maintenance of the advertisements are the responsibilities of the search engine providers; (iv) the customers have the discretion in choosing the search engines selection; (v) we receive revenues from incentive programs based on the search engine providers' policies. The Group's responsibility is to manage the customer's advertising campaign on the search engines, according to the terms of the customer contracts so the Group views itself as an agent, and records revenues related to these services on a net basis.

e-Government and Other

        The Company generates revenues by entering into service contracts with governmental agencies for its e-government solutions, including Law Dissector solutions for the court systems and other law communities beginning in 2015. The Company also generates revenues by entering into contracts with state-owned television stations for its new media solutions, including TV Dissector, Streaming Dissector and Video Dissector.

F-21

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

(l)

Advances from Customers and Deferred Revenues

        Upon the entering of contracts, customers pay the contractual balance as prepayments. The Company allocates the prepayments into advances from customers and deferred revenues. Advances from customers are the balance of the advertising campaign spending that would be recognized as cost payable to search engine providers when advertisements are placed. Deferred revenues are the revenues to be earned by the Group for services and is recognized as the revenues according to the prescribed revenue recognition criteria and policies described above.

(m)

Cost of Revenues

        Cost of revenues primarily consists of costs related to hosting the Company's cloud-based platform, providing implementation and ongoing customer support, data communications expenses, salaries and benefits of operations and support personnel, costs associated with website development activities, allocated overhead and property and equipment depreciation and amortization.

(n)

Research and Development Expenses

        Research and development costs include payroll, stock-based compensation expense and other operating costs such as outside services, supplies and allocated overhead costs. Research and development costs are expensed as incurred.

        The Company expenses all costs that are incurred in connection with the planning and implementation phases of development and costs that are associated with repair or maintenance of the existing websites or the development of software and website content. Costs incurred in the development phase are capitalized and amortized over the estimated product life. However, since the inception of the Company, the amount of costs qualifying for capitalization has been insignificant and as a result, all software development costs have been expensed as incurred.

(o)

Marketing Expenses

        Marketing expenses mainly consist of advertising costs, promotion expenses, payroll and related expenses for personnel engaged in marketing activities. Marketing expenses are expensed when the services are received. Advertising expenses are recorded as sales and marketing expenses when incurred, and totaled RMB40, RMB18 and nil for the years ended December 31, 2013, 2014 and 2015, respectively.

(p)

General and Administrative Expenses

        General and administrative expenses mainly consist of payroll and related costs for employees involved in general corporate functions, including accounting, finance, tax, legal and human resources, professional fees and other general corporate expenses as well as costs associated with the use by these functions of facilities and equipment, such as depreciation and amortization and rental expenses.

F-22

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

(q)

Operating Leases

        Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Payments made under operating leases are charged to the consolidated statements of operations and comprehensive loss on a straight-line basis over the terms of underlying lease.

(r)

Share-based Compensation

        All share-based awards to employees and directors, including stock option awards are measured at the grant date based on the fair value of the awards. Share-based compensation, net of forfeitures, is recognized as expense on a straight-line basis over the requisite service period, which is the vesting period.

        The Group uses the binominal option pricing model to determine the fair value of stock options and account for share-based compensation expenses using an estimated forfeiture rate at the time of grant and revise, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Share-based compensation expenses are recorded net of estimated forfeitures such that expenses are recorded only for those share-based awards that are expected to vest.

(s)

Employee Benefits

        The Company's subsidiaries, VIEs and VIE subsidiaries established in the PRC participate in a government-mandated, multiemployer, defined contribution plan, pursuant to which certain retirement, medical, housing and other welfare benefits are provided to employees. PRC labor laws require the entities incorporated in mainland China to pay to the local labor bureau a monthly contribution calculated at a stated contribution rate on the monthly basic compensation of qualified employees. The Group has no further commitments beyond its monthly contribution. The fair value of the employee benefits liabilities approximates their carrying value due to the short-term nature of these liabilities. The employee benefits payable amounts to RMB878, RMB1,185 and RMB1,394 as of December 31, 2013, 2014 and 2015, respectively.

        Employee social benefits included as expenses in the accompanying consolidated statements of operations and comprehensive loss amounted to RMB8,228, RMB16,817 and RMB26,365 for the years ended December 31, 2013, 2014 and 2015, respectively.

(t)

Noncontrolling interests

        In August 2015, the Group established an operating VIE subsidiary, named Beijing Guoxinwangyan Technology Co., Ltd., in which the Group owned an 80% economic interest.

(u)

Income Tax

        Current income taxes are provided on the basis of net income (loss) for financial reporting purposes and adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are provided using the liability method. Under this method, deferred tax assets and liabilities are

F-23

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

recognized for the tax effects of temporary differences and are determined by applying enacted statutory tax rates that will be in effect in the period in which the temporary differences are expected to reverse to the temporary differences between the financial statements' carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to reduce the amount of deferred tax assets if based on the weight of available evidence, it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes arising from a change in tax rates is recognized in the consolidated statements of operations and comprehensive loss in the period of change.

        The Group applies a "more likely than not" recognition threshold in the evaluation of uncertain tax positions. The Company recognizes the benefit of a tax position in its consolidated financial statements if the tax position is more likely than not to prevail based on the facts and technical merits of the position. Tax positions that meet the "more likely than not" recognition threshold are measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. Unrecognized tax benefits may be affected by changes in interpretation of laws, rulings of tax authorities, tax audits and expiry of statutory limitations. In addition, changes in facts, circumstances and new information may require the Group to adjust the recognition and measurement estimates with regard to uncertain tax positions. Accordingly, unrecognized tax benefits are periodically reviewed and re-assessed. Adjustments, if required, are recorded in the Company's consolidated financial statements in the period in which the change that necessitates the adjustments occurs. The ultimate outcome for a particular tax position may not be determined with certainty prior to the conclusion of a tax audit and, in certain circumstances, a tax appeal or litigation process. As of December 31, 2013, 2014 and 2015, the Group did not have any significant unrecognized uncertain tax positions.

(v)

Comprehensive Loss

        Comprehensive loss is defined to include all changes in deficit of the Group during a period arising from transactions and other events and circumstances other than those resulting from investments by shareholders and distributions to shareholders. For the years ended December 31, 2013, 2014 and 2015, the Group's comprehensive loss included net loss and foreign currency translation adjustments.

(w)

Loss per Share

        Basic loss per share is computed by dividing net loss attributable to holders of ordinary shares, considering the accretions to redemption value of the preferred shares, by the weighted average number of ordinary shares outstanding during the period using the two-class method. Under the two-class method, net income is allocated between ordinary shares and other participating securities based on their participating rights. Diluted loss per share is calculated by dividing net loss attributable to ordinary shareholders, as adjusted for the accretion and allocation of net income related to the preferred shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the period. Ordinary equivalent shares consist of shares issuable upon the conversion of the preferred shares using the if-converted method and ordinary shares issuable upon the exercise of outstanding stock option (using the treasury stock method). Ordinary equivalent shares are

F-24

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

not included in the denominator of the diluted earnings per share calculation when inclusion of such shares would be anti-dilutive.

(x)

Segment Reporting

        The Group provided various services to its customers, which are enterprises and government agencies or state-owned entities, including data collection and analysis, bid management, data visualization and data-mining, by offering subscription of multiple suites of the Dissector solutions. The Group's chief operating decision maker has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. The Group does not distinguish between markets or segments for the purpose of internal reporting. Hence, the Group has only one operating segment. As the Group's assets and liabilities are substantially located in the PRC, substantially all revenues are earned and substantially all expenses are incurred in the PRC, no geographical segments are presented.

(y)

Statutory Reserves

        The Company's subsidiaries, VIEs and VIE subsidiaries established in the PRC are required to make appropriations to certain non-distributable reserve funds.

        In accordance with PRC laws applicable to foreign investment enterprises ("FIE") established in the PRC, the Company's subsidiaries registered as wholly foreign owned enterprise have to make appropriations from their after-tax profits (as determined under generally accepted accounting principles in the PRC ("PRC GAAP") to non-distributable reserve funds including general reserve fund, enterprise expansion fund and staff bonus and welfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the general reserve fund has reached 50% of the registered capital of the company. Appropriations to the enterprise expansion fund and staff bonus and welfare fund are made at the respective company's discretion.

        In addition, in accordance with the PRC Company Laws, the VIEs and VIE subsidiaries, registered as Chinese domestic companies, must make appropriations from their after-tax profits as determined under the PRC GAAP to non-distributable reserve funds including the statutory surplus fund and discretionary surplus fund. The appropriation to the statutory surplus fund must be 10% of the after-tax profits as determined under PRC GAAP. Appropriation is not required if the statutory surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the Company.

        The Group has made no appropriations to the statutory surplus fund and other reserve funds for the years ended December 31, 2013, 2014 and 2015, as the Company's subsidiaries, VIEs and VIE subsidiaries in the PRC were in accumulated loss positions.

        The general reserve fund, enterprise expansion fund, statutory surplus fund and discretionary surplus fund are restricted for use. They may only be applied to offset losses or increase the registered capital of the respective company. The staff bonus and welfare fund is liability in nature and is restricted to make payment of special bonuses to employees and for the collective welfare of

F-25

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

employees. None of these reserves is allowed to be transferred to the Company by way of cash dividends, loans or advances, nor can they be distributed except under liquidation.

(z)

Recent Accounting Pronouncements

        In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)." This guidance supersedes current guidance on revenue recognition in Topic 605, "Revenue Recognition." In addition, there are disclosure requirements related to the nature, amount, timing, and uncertainty of revenue recognition. This guidance will be effective for annual reporting periods beginning after December 15, 2016, including interim reporting periods, and will be required to be applied either retrospectively or modified retrospectively. Early application of the guidance is not permitted. In August 2015, the FASB issued ASU No. 2015-14 to defer the effective date of ASU No. 2014-09 for all entities by one year. Therefore, we will adopt this guidance for its 2018 fiscal year. The Company is currently evaluating the impact of this guidance and the method of adoption.

        In June 2014, the FASB issued ASU No. 2014-12, "Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period". The new standard requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718, Compensation—Stock Compensation, as it relates to awards with performance conditions that affect vesting to account for such awards. The performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. The amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact of this guidance.

        In August 2014, FASB issued ASU No. 2014-15, "Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern." The new standard addresses management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. Management's evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. The new standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this guidance.

        In February 2015, the FASB issued ASU 2015-02 Consolidation (Topic 810)—Amendments to the Consolidation Analysis. The amendments in Topic 810 respond to stakeholders' concerns about the

F-26

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

current accounting for consolidation of variable interest entities, by changing aspects of the analysis that a reporting entity must perform to determine whether it should consolidate such entities. Under the amendments, all reporting entities are within the scope of Subtopic 810-10, Consolidation—Overall, including limited partnerships and similar legal entities, unless a scope exception applies. The amendments are intended to be an improvement to current U.S. GAAP, as they simplify the codification of FASB Statement No. 167, Amendments to FASB Interpretation No. 46(R), with changes including reducing the number of consolidation models through the elimination of the indefinite deferral of Statement 167 and placing more emphasis on risk of loss when determining a controlling financial interest. The amendments are effective for publicly-traded companies for fiscal years beginning after December 15, 2015, and for interim periods within those fiscal years. Earlier adoption is permitted. The Company is currently evaluating the impact on its consolidated financial statements of adopting this guidance.

        In November 2015, FASB issued ASU No. 2015-17, "Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes". The new guidance requires entities to present all deferred tax assets and liabilities, along with any related valuation allowance, as non-current on the balance sheet. The guidance is effective for publicly-traded companies for interim and annual periods beginning after December 15, 2016 (early adoption is permitted). The Company is currently evaluating the impact of this guidance.

3. Concentration and Risks

Concentration of search engine providers

        The Company received revenues from an incentive program administered by a search engine provider based on factors determined by the provider, such as yearly growth in the amount of advertising on the provider's search engine platform that the Company's customers purchased through the Company's solutions and other factors selected at the discretion of the provider. The Company's revenues from this program, as a percentage of the Company's total revenues for the years ended December 31, 2013, 2014 and 2015, were as follows:

	For the Year Ended December 31,
	2013	2014	2015
Revenues from the incentive program of a search engine provider	18.1%	Below 10%	Below 10%

Concentration of credit risk

        Assets that potentially subject the Group to significant concentrations of credit risk primarily consist of cash and cash equivalents and accounts receivable. As of December 31, 2013, 2014 and 2015, all of the Group's cash and cash equivalents were held by reputable financial institutions located in the PRC, Hong Kong and the United States, which management believes are of high credit quality and financially sound based on public available information.

F-27

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

3. Concentration and Risks (continued)

        Accounts receivable is typically unsecured and is generally derived from revenues earned from marketing automation solutions. Customers with a receivable balance exceeding 10% of the total accounts receivable balance, net of allowance for doubtful accounts, as of December 31, 2013, 2014 and 2015, are listed as follows:

	As of December 31,
	2013			2014			2015
Customer A		21.4	%		Below 10	%		Below 10	%
Customer B		16.2	%		Below 10	%		Below 10	%
Customer C		12.3	%		Below 10	%		Below 10	%
Customer D		Below 10	%		14.0	%		Below 10	%
Customer E		Below 10	%		Below 10	%		31.8	%

Currency risk

        The Group's operation transactions and its assets and liabilities are primarily denominated in RMB, which is not freely convertible into foreign currencies. The Group's cash and cash equivalents denominated in RMB are subject to such government controls and amounted to RMB46,323, RMB58,450 and RMB178,577 as of December 31, 2013, 2014 and 2015, respectively. The value of the RMB is subject to changes in the central government policies and international economic and political developments that affect the supply and demand of RMB in the foreign exchange market. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the People's Bank of China (the "PBOC"). Remittances from China in currencies other than RMB by the Group must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to effect the remittance.

4. Fair Value Measurement

        The Group measured its financial assets and liabilities which consist entirely of cash and cash equivalents at fair value on a recurring basis as of December 31, 2013, 2014 and 2015. Cash and cash equivalents are classified within Level 1 of the fair value hierarchy because they are valued based on the quoted market price in an active market.

        The rates of interest under the loan agreements with the lending banks were determined based on the prevailing interest rates in the market. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements of short-term bank loan.

F-28

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

5. Accounts Receivable

        The following summarizes the Group's accounts receivable as of December 31, 2013, 2014 and 2015:

	As of December 31,
	2013			2014			2015
	RMB			RMB			RMB
Accounts receivable		64,602			88,348			280,801
Less: Allowance for doubtful accounts		(25	)		(92	)		(1,264	)
Accounts receivable, net		64,577			88,256			279,537

        The amount of payments to service providers on behalf of customers included in accounts receivable was RMB53,273, RMB66,389 and RMB230,884 as of December 31, 2013, 2014 and 2015, respectively.

        The following table sets out the movements of the allowance for doubtful accounts for the years ended December 31, 2013, 2014 and 2015:

	As of December 31,
	2013			2014			2015
	RMB			RMB			RMB
Balance at beginning of the year		—			(25	)		(92	)
Charged to costs and expenses		(25	)		(67	)		(1,172	)
Write-off of receivable balances and corresponding provisions		—			—			—
Balance at end of the year		(25	)		(92	)		(1,264	)

6. Prepayments and Other Current Assets

        The following is a summary of prepayments and other current assets:

	As of December 31,
	2013		2014		2015
	RMB		RMB		RMB
Deposits to search engine service providers		34,622		38,343		85,417
Prepayments to suppliers		11,429		9,854		12,574
Prepaid rental and other deposits		1,438		2,121		4,272
Advances to employees		499		529		3,709
Others		367		579		1,074
Total		48,355		51,426		107,046

        Deposits to search engine service providers represent deposits to guarantee the minimum amount of ad spending by the Group's customers and are refunded annually when the minimum ad spending requirement is met.

F-29

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

7. Property, Equipment and Software, net

        The following is a summary of property, equipment and software, net:

	As of December 31,
	2013			2014			2015
	RMB			RMB			RMB
Computers and software		8,876			25,207			36,988
Furniture, fixtures and equipment		2,358			2,996			3,304
Vehicles		—			821			1,833
Leasehold improvements		4,416			12,006			16,341
Total		15,650			41,030			58,466
Less: accumulated depreciation and amortization		(7,908	)		(14,945	)		(22,223	)
Property, equipment and software, net		7,742			26,085			36,243

        Depreciation and amortization expenses for the years ended December 31, 2013, 2014 and 2015 were RMB3,746, RMB7,037 and RMB13,048 respectively.

8. Short-term Bank Loan

        In 2014, the Company entered into a short-term guaranteed loan arrangement with the China Merchants Bank. The loan amounted to RMB4,000, with a fixed interest rate of 6.72% per annum and a maturity term of twelve months. A guarantee was provided by Beijing Haidian Sci-tech Enterprises Financing Guarantee Co., Ltd. and Guosheng Qi, the Co-Founder, Chief Executive Officer and Chairman of the Company. The short-term loan was repaid in December 2015.

9. Accrued Expenses and Other Current Liabilities

        The following is a summary of accrued expenses and other current liabilities:

	As of December 31,
	2013		2014		2015
	RMB		RMB		RMB
Customer deposits		28,541		46,587		54,677
Accrued expenses		1,786		6,208		15,489
Others		502		545		742
Total		30,829		53,340		70,908

10. Taxation

(a)

Value added tax

        The Group's revenues are subject to VAT at the rate of 6%. The Group's VAT payable balance amounted to RMB764, RMB1,354 and RMB9,513 as of December 31, 2013, 2014 and 2015, respectively.

F-30

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

(b)

Income tax

Cayman Islands

        Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, the Cayman Islands does not impose a withholding tax on payments of dividends to shareholders.

Hong Kong

        Under the current Hong Kong Inland Revenue Ordinance, the Company's Hong Kong subsidiary is subject to Hong Kong profits tax at the rate of 16.5% on its taxable income generated from the operations in Hong Kong. Payments of dividends by the subsidiary to the Company are not subject to withholding tax in Hong Kong.

PRC

        The Group's subsidiaries, VIEs and VIE subsidiaries in the PRC are subject to the PRC Enterprise Income Tax Law ("EIT Law") and are taxed at the statutory income tax rate of 25%.

        The EIT Law also provides that an enterprise established under the laws of a foreign country or region but whose "de facto management body" is located in the PRC be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The Implementing Rules of the EIT Law merely define the location of the "de facto management body" as "the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, property, etc., of a non-PRC company is located." Based on a review of surrounding facts and circumstances, the Group does not believe that it is likely that its operations outside the PRC should be considered a resident enterprise for PRC tax purposes.

        High and new technology enterprises ("HNTE") will enjoy a preferential enterprise income tax rate of 15% under the EIT Law. Beijing Gridsum Technology Co., Ltd. and Guoxinjunhe (Beijing) Technology Co., Ltd, the Group's consolidated affiliated entities in the PRC, which are qualified as a HNTE under the EIT Law, is eligible for a preferential enterprise income tax rate of 15% for the period from 2014 to 2016, so long as they obtain approval from relevant tax authority if they are profitable during the period.

Withholding tax on undistributed dividends

        The EIT law also imposes a withholding income tax of 10% on dividends distributed by a FIE to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company's jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company is incorporated, does not have such tax treaty with China. According to the arrangement between Mainland China and Hong Kong Special Administrative Region on the Avoidance of Double Taxation

F-31

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

and Prevention of Fiscal Evasion in August 2006, dividends paid by an FIE in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5% (if the foreign investor owns directly at least 25% of the shares of the FIE). The Group did not record any dividend withholding tax, as Gridsum PRC Holding, the PRC WFOE, has no retained earnings in any of the periods presented.

        The following table sets forth the component of income tax expenses of the Company for the years ended December 31, 2013, 2014 and 2015:

	For the Year Ended December 31,
	2013		2014		2015
	RMB		RMB		RMB
Current tax expenses		130		476		4,693
Deferred tax expenses		—		—		—
Income tax expenses		130		476		4,693

        Reconciliation of the differences between PRC statutory income tax rate and the Group's effective income tax rate for the years ended December 31, 2013, 2014 and 2015 is as follows:

	For the Year Ended December 31,
	2013			2014			2015
	%			%			%
PRC statutory tax rate		25.0			25.0			25.0
Effect of overseas tax-exempt entities		(4.9	)		(4.5	)		(14.4	)
Effect of lower tax rate entities		(0.3	)		(1.2	)		3.7
Permanent book-tax differences		(2.6	)		(5.8	)		(9.0	)
Changes in valuation allowance		(17.6	)		(14.8	)		(15.7	)
Effective tax rate		(0.4	)		(1.3	)		(10.4	)

F-32

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

(c)

Deferred tax assets

        The following table sets forth the significant components of the aggregate deferred tax assets and liabilities:

	As of December 31,
	2013			2014			2015
	RMB			RMB			RMB
Deferred tax assets—current
Education expense		7			—			349
Accrued expenses and others		219			230			546
Total current deferred tax assets		226			230			895
Less: Valuation allowance		(226	)		(230	)		(895	)
Total current deferred tax assets, net		—			—			—
Deferred tax assets—non-current
Loss carry-forward		13,345			19,147			14,168
Total non-current deferred tax assets		13,345			19,147			14,168
Less: Valuation allowance		(13,345	)		(19,147	)		(14,168	)
Total non-current deferred tax assets, net		—			—			—

        As of December 31, 2015, the Group had net operating loss carryforwards of approximately RMB7,185 attributable to the Hong Kong subsidiary and of approximately RMB51,931 attributable to the PRC subsidiaries, VIEs and VIEs' subsidiaries. The loss carried forward by the Hong Kong subsidiary can be carried forward to net against future taxable income without a time limit, while the loss carried forward by the PRC companies will expire during the period from Year 2016 to Year 2020.

        A valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the foreseeable future. In making such determination, the Group evaluates a variety of factors including the Group's operating history, accumulated deficit, existence of taxable temporary differences and reversal periods.

        The Group has incurred accumulated net operating losses for income tax purposes since its inception. The Group believes that it is more likely than not that these accumulated net operating losses and other deferred tax assets will not be utilized in the foreseeable future. Accordingly, the Group has provided full valuation allowance for the deferred tax assets as of December 31, 2013, 2014 and 2015.

F-33

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

        Changes in valuation allowance are as follows:

	As of December 31,
	2013		2014		2015
	RMB		RMB		RMB
Balance at beginning of the year		8,261		13,571		19,377
Provision		5,310		5,806		(4,314	)
Balance at end of the year		13,571		19,377		15,063

11. Redeemable Convertible Preferred Shares

        In September 2010, the Group issued 3,125,000 Series A convertible and redeemable preferred shares for aggregate proceeds of RMB35,707 (US$5,250).

        In July 2011, the Group issued 1,302,084 Series A-1 convertible and redeemable preferred shares for aggregate proceeds of RMB24,251 (US$3,750).

        In October 2013, the Group issued 2,962,239 Series B convertible and redeemable preferred shares for aggregate proceeds of RMB107,100 (US$17,500).

        In January and March 2015, the Group issued 4,640,843 Series C convertible and redeemable preferred shares for aggregate proceeds of RMB262,561 (US$42,000).

        The Group has classified the Series A, A-1, B and C preferred shares as mezzanine equity in the consolidated balance sheets as they are contingently redeemable at the option of the holders at any time after September 6, 2017 if a qualified initial public offering has not occurred.

        The Group has determined that conversion and redemption features embedded in the Preferred Shares are not required to be bifurcated and accounted for as derivatives, as the economic characteristics and risks of the embedded conversion and redemption features are clearly and closely related to that of the preferred shares. The preferred shares are not readily convertible into cash as there is not a market mechanism in place for trading of the Company's shares.

        The Group has determined that there was no beneficial conversion feature attributable to any of the preferred shares because the initial effective conversion prices of these preferred shares were higher than the fair value of the Company's ordinary shares at the relevant commitment dates.

        In addition, the carrying values of the preferred shares are accreted from the share issuance dates to the redemption value on the earliest redemption dates. The accretions are recorded against retained earnings, or in the absence of retained earnings, by charges against additional paid-in capital. Once additional paid-in capital has been exhausted, additional charges are recorded by increasing the accumulated deficit.

F-34

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

        As of December 31, 2015, the preferred shares are comprised of the following:

				Shares
Series	Date of Issuance	Issue Price Per Share		Authorized		Issued and Outstanding		Aggregate Liquidation Value		Initial Conversion Ratio		Carrying Amount
		US$										RMB
A	September 6, 2010		1.68		3,125,000		3,125,000		—		1:1		40,181
A-1	July 6, 2011		2.88		1,302,084		1,302,084		—		1:1		28,492
B	October 1, 2013		5.91		2,962,239		2,962,239		—		1:1		126,641
C	January 30, 2015 and March 5, 2015		9.05		4,640,843		4,640,843		—		1:1		280,704

        The rights, preferences and privileges of the preferred shares are as follows:

Redemption Rights

        At any time after September 6, 2017 ("Redemption Start Date"), if a qualified initial public offering has not occurred, holders of more than 50% of the then outstanding Series A, A-1, B and C preferred shares may request redemption of the preferred shares of such series. On receipt of a redemption request from the holders, the Company shall redeem all or part, as requested, of the outstanding preferred shares of such series.

        If any holder of any series of preferred shares exercises its redemption right, any holder of other series of preferred shares shall have the right to exercise the redemption of its series at the same time.

        The redemption price shall be 125% of original issuance price of Series A, Series A-1 and Series B preferred shares, 110% of original issuance price of Series C preferred shares, plus all declared but unpaid dividends up to redemption closing date. The Group shall execute and deliver to each Series A, A-1, B and C preferred shares holders a promissory note for the full amount of the redemption payment due but not paid. That such promissory note shall be due and payable no later than one year anniversary of the closing date of the redemption and shall accrue interest daily at a rate of ten percent per annum.

F-35

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

        The following table sets forth the changes of each of the convertible redeemable preferred shares for the years ended December 31, 2013, 2014 and 2015:

	Series A Preferred Share					Series A-1 Preferred Share					Series B Preferred Share					Series C Preferred Share
	Number of Shares		Amount			Number of Shares		Amount			Number of Shares		Amount			Number of Shares		Amount			Total Amount
			RMB					RMB					RMB					RMB			RMB
As of December 31, 2012		3,125,000		34,944			1,302,084		24,453			—		—			—		—			59,397
Gross proceeds from the issuance		—		—			—		—			2,962,239		107,100			—		—			107,100
Issuance cost of Series B		—		—			—		—			—		(4,166	)		—		—			(4,166	)
Accretion		—		1,176			—		934			—		1,739			—		—			3,849
Accumulated other comprehensive income		—		(1,007	)		—		(707	)		—		(1,142	)		—		—			(2,856	)
As of December 31, 2013		3,125,000		35,113			1,302,084		24,680			2,962,239		103,531			—		—			163,324
Accretion		—		1,219			—		972			—		7,289			—		—			9,480
Accumulated other comprehensive income		—		884			—		621			—		2,632			—		—			4,137
As of December 31, 2014		3,125,000		37,216			1,302,084		26,273			2,962,239		113,452			—		—			176,941
Gross proceeds from the issuance		—		—			—		—			—		—			4,640,843		262,561			262,561
Issuance cost of Series C		—		—			—		—			—		—			—		(1,061	)		(1,061	)
Accretion		—		1,286			—		1,029			—		7,945			—		9,447			19,707
Accumulated other comprehensive income		—		1,679			—		1,190			—		5,244			—		9,757			17,870
As of December 31, 2015		3,125,000		40,181			1,302,084		28,492			2,962,239		126,641			4,640,843		280,704			476,018

Conversion Rights

        Each preferred share is convertible, at the option of the holder, at any time after the date of issuance of such preferred shares, according to a conversion ratio, subject to adjustments for dilution, including but not limited to stock splits, stock dividends and capitalization and certain other events. Each preferred share is convertible into a number of ordinary shares determined by dividing the applicable original issuance price by the conversion price. The conversion price of each preferred share is the same as its original issuance price and no adjustments to conversion price have occurred. At December 31, 2015, each preferred share is convertible into one ordinary Class B share.

        Each preferred share shall automatically be converted into ordinary shares, at the then applicable preferred share conversion price, upon closing of a qualified initial public offering.

        Prior to the Series B preferred shares issuance on October 1, 2013, a "Qualified Initial Public Offering" was defined as an initial public offering with net offering proceeds no less than US$30 million and implied market capitalization of the Company of no less than US$160 million prior to such initial public offering. Upon the issuance of the Series B preferred shares, the net offering proceeds and market capitalization criteria for a "Qualified Initial Public Offering" was increased to US$100 million and US$235 million, respectively. Upon the issuance of the Series C preferred shares, the market capitalization criterion for a "Qualified Initial Public Offering" was increased to US$360 million.

F-36

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

Voting rights

        Each preferred share shall be entitled to that number of votes corresponding to the number of ordinary shares on an as-converted basis. Preferred shares shall vote separately as a class with respect to certain specified matters. Otherwise, the holders of preferred shares and ordinary shares shall vote together as a single class.

Dividend Rights

        Preferred shares holders are entitled to receive dividends if declared by the Board of Directors, in an amount equal to 10% of the original issuance price of the respective series of preferred shares per annum, prior and in preference to any dividend on the ordinary shares. The dividends for Series A, Series A-1, Series B preferred shares shall be accruing and cumulative and non-compounding. The dividends for Series C preferred shares shall be non-cumulative and non-compounding.

        The remaining undistributed earnings of the Company after full payment of the above amounts on the preferred shares, shall be distributed on a prorate basis to the holders of ordinary shares and preferred shares on as-if-converted basis.

Liquidation Preferences

        Upon any liquidation event, including deemed liquidation, dissolution or winding up of the Company, the assets of the Company shall be distributed in the following order:

(i)

First, before any distribution or payment to holders of Series A, A-1 and B preferred shares or ordinary shares, each holder of the Series C preferred shares shall be entitled to receive an amount per share equal to 100% of the Series C preferred shares original issuance price, plus all dividends declared but unpaid with respect thereto.



(ii)

Second, following payment in full of the Series C preferred shares amount, but before any distribution or payment to Series A and Series A-1 preferred shares and ordinary shareholders, each holder of the Series B preferred shares shall be entitled to receive an amount per share equal to 125% of the Series B preferred shares original issuance price, plus all dividends accrued but unpaid with respect thereto.



(iii)

Third, following payment in full of the Series C and Series B preferred shares amount, but before any distribution or payment to ordinary shareholders, each holder of the Series A and Series A-1 preferred shares shall be entitled to receive an amount per share equal to 150% of the Series A or Series A-1 preferred shares original issuance price, plus all dividends accrued but unpaid with respect thereto.



(iv)

If there are assets of the Company available for distribution after payment of the above items i), ii), and iii) the remaining assets shall be distributed ratably among the holders of ordinary shares and preferred shares on an as if converted basis.

12. Ordinary Shares

        The Company is authorized to issue a maximum of 50,000,000 shares with a par value of US$0.001 per share, comprised of 37,969,834 ordinary shares and 12,030,166 preferred shares.

F-37

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

12. Ordinary Shares (continued)

        On January 26, 2015, the Company approved the designation of all the issued and outstanding ordinary shares of the Company as Class A ordinary shares or Class B ordinary shares. The holders of Class A ordinary shares shall have two votes in respect of each Class A ordinary share held, the holders of Class B ordinary shares shall have one vote in respect of each Class B ordinary share held, and holder of preferred shares shall be entitled to such number of votes as equals the whole number of Class B ordinary shares on an as-converted basis.

        As of December 31, 2015, the Company was authorized to issue a maximum of 50,000,000 shares with a par value of US$0.001 per share, comprised of 4,543,461 Class A ordinary shares, 33,426,373 Class B ordinary shares and 12,030,166 preferred shares.

13. Share-based Compensation

Share Incentive Plan

        In 2014, the Group amended its employment-related stock option plan, which the Group originally adopted in 2011 ("2014 Plan") under which 2,500,000 Class B ordinary shares are available for issuance. The 2014 Plan will terminate automatically in December 2019, unless terminated earlier.

        From 2011 to 2015, the Group granted options with an average exercise price of US$0.42 per share under the 2014 plan. All of the options were to be vested over four years, one fourth (¹/4) vesting and exercisable upon the first anniversary of the date of grant, and the remaining vesting monthly thereafter in 36 equal monthly installments.

        Valuation Assumptions:    The Group estimated the fair value of stock options using the Binominal option-pricing model with the assistance from an independent valuation firm. The fair value of each option grant is estimated on the date of grant with the following assumptions:

	For the Year Ended December 31,
	2013			2014			2015
Exercise price		US$0.42			US$0.42			US$0.42
Risk free rate of interest		3.56	%		2.77%-3.63	%		2.59%-2.95	%
Dividend yield		—			—			—
Life of option (years)		10			10			10
Volatility		47	%		50%-52	%		46%-49	%
Exercise multiple (years)		2.2			2.2			2.2

        The Group estimated the risk free rate based on the yield to maturity of US treasury bonds denominated in U.S. Dollars at the option valuation date. The exercise multiple is estimated as the ratio of fair value of underlying shares over the exercise price as at the time the option is exercised, based on a consideration of research study regarding exercise pattern based on historical statistical data. Expected term is the contract life of the option. The expected volatility at the date of grant date and each option valuation date was estimated based on the historical stock prices of comparable companies. The Group has never declared or paid any cash dividends on its capital stock, and the Group does not anticipate any dividend payments on its ordinary shares in the foreseeable future.

F-38

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

13. Share-based Compensation (continued)

        A summary of the Group's stock option activities for the years ended December 31, 2013, 2014 and 2015 is presented below:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
				US$		In years		US$
Outstanding as of December 31, 2012		1,634,750			0.42		9.36		1,782
Granted		78,125			0.42		—		—
Forfeited/expired		(25,625	)		0.42		—		—
Outstanding as of December 31, 2013		1,687,250			0.42		8.42		3,937
Granted		593,036			0.42		—		—
Forfeited/expired		(88,125	)		0.42		—		—
Outstanding as of December 31, 2014		2,192,161			0.42		7.98		16,471
Granted		331,000			0.42		—		—
Forfeited/expired		(24,000	)		0.42		—		—
Outstanding as of December 31, 2015		2,499,161			0.42		7.28		28,540
Exercisable as of December 31, 2015		1,525,258			0.42		6.59		17,418

        The weighted average grant date fair value of options granted for the year ended December 31, 2013, 2014 and 2015 was US$2.26, US$4.48 and US$8.81 per share respectively.

        Share-based compensation expenses for the share-based awards which are based on service conditions are recognized using the straight-line attribution approach.

        For the years ended December 31, 2013, 2014 and 2015, the Group recognized share-based compensation expenses of RMB2,294, RMB3,882 and RMB8,806 respectively, for the stock options granted.

        As of December 31, 2015, there was RMB28,643 of total unrecognized compensation expense, adjusted for estimated forfeitures, related to non-vested share-based compensation arrangement under the 2014 Plan. The expense is expected to be recognized over a weighted average period of 1.35 years. Total unrecognized compensation expense may be adjusted for future changes in estimated forfeitures.

F-39

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

14. Net Loss per Share

        The following table sets forth the basic and diluted net loss per share computation and provides a reconciliation of the numerator and denominator for the periods presented:

	For the Year Ended December 31,
	2013			2014			2015
	RMB			RMB			RMB
Numerator:
Net loss attributable to Gridsum Holding Inc.		(30,674	)		(37,260	)		(48,819	)
Accretion to convertible redeemable preferred share redemption value—A		(1,176	)		(1,219	)		(1,286	)
Accretion to convertible redeemable preferred share redemption value—A-1		(934	)		(972	)		(1,029	)
Accretion to convertible redeemable preferred share redemption value—B		(1,739	)		(7,289	)		(7,945	)
Accretion to convertible redeemable preferred share redemption value—C		—			—			(9,447	)
Cumulative dividend to convertible redeemable preferred shareholders—A		(3,227	)		(3,235	)		(3,297	)
Cumulative dividend to convertible redeemable preferred shareholders—A-1		(2,305	)		(2,310	)		(2,355	)
Cumulative dividend to convertible redeemable preferred shareholders—B		(2,683	)		(10,782	)		(10,990	)
Numerator for basic and diluted net loss per share		(42,738	)		(63,067	)		(85,168	)
Denominator:
Weighted average number of ordinary shares outstanding, basic and diluted		10,000,000			10,000,000			10,000,000
Net loss per share attributable to Gridsum's ordinary shareholders—Basic and diluted		(4.27	)		(6.31	)		(8.52	)

        Basic net loss per share is computed using the weighted average number of the ordinary shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of ordinary shares and dilutive ordinary share equivalents outstanding during the period. For the years ended December 31, 2013, 2014 and 2015, options to purchase 1,657,986, 1,970,490 and 1,888,049 ordinary shares that were anti-dilutive and excluded from the calculation of diluted net loss per share, respectively. For the years ended December 31, 2013, 2014 and 2015, the Series A, Series A-1, Series B and Series C preferred shares of 5,173,731, 7,389,323 and 11,609,978, respectively, on a weighted average basis were also antidilutive and excluded from the calculation of diluted net loss per share.

F-40

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

15. Related Party Transactions

        The table below sets forth the related parties and their relationship with the Company:

Related party	Relationship with the Company
Guosheng Qi	Chairman and Chief Executive Officer
Guofa Yu	Director and Senior Vice President

        As of December 31, 2013, 2014 and 2015, the Group had amounts due to Guofa Yu of RMB436, RMB313 and nil, respectively. The amounts due to Guofa Yu have been classified as a current liability as the repayment is due upon demand.

        In addition, Guosheng Qi acted as one of the guarantees for the short-term bank loan borrowed by the Group in 2014 from China Merchants Bank, as disclosed in Note 8.

16. Commitments and Contingencies

(a)

Commitments

        The Group leases its offices and facilities under non-cancelable operating lease agreements. Rental expenses were RMB6,448, RMB15,138 and RMB17,748 for the years ended December 31, 2013, 2014 and 2015, respectively.

        As of December 31, 2015, future minimum lease under non-cancelable operating lease agreements were as follows:

	Rental commitments
	RMB
2016		9,899
2017		2,816
2018		1,492
2019 and thereafter		—
		14,207

(b)

Litigation

        From time to time, the Company is involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, management does not believe that the ultimate outcome of these unresolved matters, individually and in the aggregate, is reasonably possible to have a material adverse effect on the Company's financial position, results of operations or cash flows. However, litigation is subject to inherent uncertainties and the Company's view of these matters may change in the future. Were an unfavorable outcome to occur, there exists the possibility of a material adverse impact on the Company's financial position, results of operations or cash flows for the period in which the unfavorable outcome occurs and potentially in future periods.

17. Subsequent Events

        (a)   On February 2, 2016, the Company adopted and approved the 2016 Equity Incentive Plan (the "2016 Plan"), which will become effective upon the completion of the Company's initial public offering.

F-41

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

17. Subsequent Events (continued)

2,500,000 Class B ordinary shares (plus such number of additional Class B ordinary shares described in Section 2.1 of the 2016 Plan) are reserved for issuance pursuant to the 2016 Plan, and the number of Class B ordinary shares reserved for issuance pursuant to the 2016 Plan shall thereafter increase automatically in accordance with the mechanism set forth in the 2016 Plan.

        (b)   On February 2, 2016, the shareholders of the Company approved that, immediately upon the completion of the Company's initial public offering, the authorized share capital of the Company will increase from (A) US$50,000 divided into (i) 37,969,834 ordinary shares of US$0.001 par value each, of which 4,543,461 are designated as Class A ordinary shares and 33,426,373 are designated as Class B ordinary shares, and (ii) 3,125,000 Series A preferred shares of US$0.001 par value each, 1,302,084 Series A-1 preferred shares of US$0.001 par value each, 2,962,239 Series B preferred shares of US$0.001 par value each, and 4,640,843 Series C preferred shares of US$0.001 par value each to (B) US$200,000, divided into (i) 20,000,000 Class A ordinary shares with a par value of US$0.001 each, and (ii) 180,000,000 Class B ordinary shares with a par value of US$0.001 each as defined in the Memorandum and Articles of Association. In addition, all of the Company's Series A preferred shares, Series A-1 preferred shares, Series B preferred shares and Series C preferred shares then issued and outstanding be converted into ordinary shares of the Company, and such ordinary shares be immediately re-designated as Class B ordinary shares, in each case at the conversion or re-designation ratio of 1:1.

        (c)   On February 5, 2016, the Company established a new wholly owned subsidiary, Beijing Gridsum Yizhun Technology Co., Ltd. There is no business activity, nor any asset associated with this subsidiary yet.

        The Group has performed an evaluation of subsequent events through March 9, 2016, which is the date that the financial statements were issued, with no other events or transactions needing recognition or disclosure identified.

18. Restricted Net Assets

        Relevant PRC laws and regulations permit payments of dividends by the subsidiaries and the VIEs incorporated in the PRC only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, each of the Company's subsidiaries and VIEs is required to annually appropriate 10% of net after-tax income to the statutory general reserve fund (Note 2(y)) prior to payment of any dividends, unless such reserve funds have reached 50% of its respective registered capital. As a result of these and other restrictions under PRC laws and regulations, the subsidiaries, VIEs and VIE subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company either in the form of dividends, loans or advances of the Group's total consolidated net assets. As of December 31, 2015, the total restricted net assets of the Company's subsidiaries, VIEs and VIE subsidiaries incorporated in PRC and subjected to restriction amounted to approximately RMB102,251. Even though the Company currently does not require any such dividends, loans or advances from the PRC entities for working capital and other funding purposes, the Company may in the future require additional cash resources from them due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends or distributions to its shareholders. Except for the above, there is no other restriction on the use of proceeds generated by the Company's subsidiaries, VIEs and VIE subsidiaries to satisfy any obligations of the Company.

F-42

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY

        Rules 12-04(a) and 4-08(e)(3) of Regulation S-X require condensed financial information as to the financial position, cash flows and results of operations of a parent company as of and for the same periods for which the audited consolidated financial statements have been presented when the restricted net assets of the consolidated and unconsolidated subsidiaries together exceed 25% of consolidated net assets as of the end of the most recently completed fiscal year.

        The following condensed financial statements of the Company have been prepared using the same accounting policies as set out in the Company's consolidated financial statements except that the Company used the equity method to account for its investment in its subsidiaries and VIEs. Such investment is presented on the separate condensed balance sheets of the Company as "Investment in subsidiaries and VIEs" and "Accumulated losses in excess of investment in subsidiaries and VIEs." The Company, its subsidiaries and VIEs were included in the consolidated financial statements whereby the inter-company balances and transactions were eliminated upon consolidation. The Company's share of income from its subsidiaries and VIEs is reported as share of income from subsidiaries and VIEs in the condensed financial statements.

        The Company is a Cayman Islands company and, therefore, is not subjected to income taxes for all years presented. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these statements should be read in conjunction with the notes to the consolidated financial statements of the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted.

        As of December 31, 2013, 2014 and 2015, there were no material commitments or contingencies, significant provisions for long-term obligations or guarantees of the Company, except for those which have been separately disclosed in the consolidated financial statements, if any.

        Inter-company charges, share-based compensation and other miscellaneous expenses for the years ended December 31, 2013, 2014 and 2015, which were previously recognised at the parent company level, had been pushed down to the WFOE/VIE level given the majority of services were provided to the WFOE/VIE entities.

F-43

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

Condensed Balance Sheets of Parent Company

	As of December 31,
	2013		2014		2015		2015
	RMB		RMB		RMB		US$
ASSETS
Current assets:
Cash and cash equivalents		—		—		19,616		2,952
Amounts due from subsidiaries and VIEs		—		—		64,550		9,713
Prepayments and other current assets		—		—		3,556		535
Total current assets		—		—		87,722		13,200
Non-current assets:
Investment in subsidiaries and VIEs		76,652		45,405		177,921		26,772
Total non-current assets		76,652		45,405		177,921		26,772
Total assets		76,652		45,405		265,643		39,972
LIABILITY, MEZZANINE EQUITY AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accrued expenses and other current liabilities		—		—		253		38
Total current liabilities		—		—		253		38
Total liabilities		—		—		253		38
Commitments and contingencies
Mezzanine equity:
Series A convertible preferred shares (US$0.001 par value; 3,125,000 shares authorized, 3,125,000 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		35,113		37,216		40,181		6,046
Series A-1 convertible preferred shares (US$0.001 par value; 1,302,084 shares authorized, 1,302,084 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		24,680		26,273		28,492		4,287
Series B convertible preferred shares (US$0.001 par value; 2,962,239 shares authorized, 2,962,239 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		103,531		113,452		126,641		19,056
Series C convertible preferred shares (US$0.001 par value; 4,640,843 shares authorized, 4,640,843 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively; aggregate liquidation value of nil as of December 31, 2013, 2014 and 2015, respectively)		—		—		280,704		42,237
Total mezzanine equity		163,324		176,941		476,018		71,626

F-44

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

	As of December 31,
	2013			2014			2015			2015
	RMB			RMB			RMB			US$
Shareholders' deficit:
Ordinary shares (US$0.001 par value; 42,610,677 shares authorized, 10,000,000, 10,000,000 and nil shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		68			68			—			—
Ordinary shares—Class A (US$0.001 par value; nil, nil and 4,543,461 shares authorized as of December 31, 2013, 2014 and 2015, nil, nil and 4,543,461 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		—			—			31			5
Ordinary shares—Class B (US$0.001 par value; nil, nil and 33,426,373 shares authorized as of December 31, 2013, 2014 and 2015, nil, nil and 5,456,539 shares issued and outstanding as of December 31, 2013, 2014 and 2015, respectively)		—			—			37			6
Additional paid-in capital		8,034			2,436			—			—
Accumulated other comprehensive income/(loss)		2,326			320			(19,052	)		(2,867	)
Accumulated deficit		(97,100	)		(134,360	)		(191,644	)		(28,836	)
Gridsum's shareholders' deficit		(86,672	)		(131,536	)		(210,628	)		(31,692	)
Total liabilities, mezzanine equity and shareholders' deficit		76,652			45,405			265,643			39,972

Condensed Statements of Operations and Comprehensive Loss of Parent Company

	For the Year Ended December 31,
	2013			2014			2015			2015
	RMB			RMB			RMB			US$
Revenues		—			—			—			—
Cost of revenues		—			—			—			—
Gross profit		—			—			—			—
Operating expenses:
Sales and marketing expenses		—			—			—			—
Research and development expenses		—			—			—			—
General and administrative expenses		(78	)		(198	)		(565	)		(85	)
Total operating expenses		(78	)		(198	)		(565	)		(85	)
Loss from operations		(78	)		(198	)		(565	)		(85	)
Loss from subsidiaries and VIEs		(30,596	)		(37,062	)		(48,254	)		(7,261	)
Net loss		(30,674	)		(37,260	)		(48,819	)		(7,346	)
Accretions to preferred shares redemption value		(3,849	)		(9,480	)		(19,707	)		(2,965	)
Cumulative dividend to preferred shareholders		(8,215	)		(16,327	)		(16,642	)		(2,504	)
Net loss attributable to Gridsum's ordinary shareholders		(42,738	)		(63,067	)		(85,168	)		(12,815	)
Comprehensive loss		(29,824	)		(39,266	)		(68,207	)		(10,263	)

F-45

GRIDSUM HOLDING INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

Condensed Statement of Cash Flows of Parent Company

	For the Year Ended December 31, 2015
	RMB			US$
Cash flows from operating activities:
Net cash used in operating activities		(56,436	)		(8,491	)
Cash flows from investing activities:
Investment of subsidiaries and VIEs		(185,448	)		(27,904	)
Net cash used in investing activities		(185,448	)		(27,904	)
Cash flows from financing activities:
Proceeds from issuance of Series C preferred shares		262,561			39,507
Payment of financing costs in connection with the issuance of Series C preferred shares		(1,061	)		(160	)
Net cash provided by financing activities		261,500			39,347
Net increase in cash and cash equivalents		19,616			2,952
Cash and cash equivalents at the beginning of the year		—			—
Cash and cash equivalents at the end of the year		19,616			2,952
Supplemental schedule of non-cash financing activities:
Accretions to preferred shares redemption value		19,707			2,965

        There were no cash flows of Gridsum Holding Inc. for the years ended December 31, 2013 and 2014.

F-46

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS

As of December 31, 2015 and June 30, 2016

(In thousands, except for share and per share data)

	As of December 31, 2015		As of June 30, 2016
	RMB		RMB		US$ Note 2(c)		RMB Pro forma (Note 15)		US$ Note 2(c) Pro forma (Note 15)
ASSETS
Current assets:
Cash and cash equivalents		198,523		115,663		17,404		115,663		17,404
Accounts receivable, net		279,537		418,658		62,995		418,658		62,995
Prepayments and other current assets.		107,046		118,400		17,815		118,400		17,815
Total current assets		585,106		652,721		98,214		652,721		98,214
Non-current assets:
Property, equipment and software, net		36,243		47,889		7,206		47,889		7,206
Other non-current assets		4,558		2,285		344		2,285		344
Total non-current assets		40,801		50,174		7,550		50,174		7,550
Total assets		625,907		702,895		105,764		702,895		105,764
LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' (DEFICIT)/EQUITY
Current liabilities:
Short-term bank loan (including short-term bank loan of the consolidated VIEs without recourse to the primary beneficiaries of nil and RMB10,000 as of December 31, 2015 and June 30, 2016, respectively)		—		10,000		1,505		10,000		1,505
Accounts payable (including accounts payable of the consolidated VIEs without recourse to the primary beneficiaries of RMB103,289 and RMB169,464 as of December 31, 2015 and June 30, 2016, respectively)		103,289		169,464		25,499		169,464		25,499
Salary and welfare payables (including salary and welfare payables of the consolidated VIEs without recourse to the primary beneficiaries of RMB32,887 and RMB32,202 as of December 31, 2015 and June 30, 2016, respectively)		33,539		32,830		4,940		32,830		4,940
Taxes payable (including taxes payable of the consolidated VIEs without recourse to the primary beneficiaries of RMB16,484 and RMB25,311 as of December 31, 2015 and June 30, 2016, respectively)		16,484		25,311		3,809		25,311		3,809
Deferred revenues (including deferred revenues of the consolidated VIEs without recourse to the primary beneficiaries of RMB31,308 and RMB44,664 as of December 31, 2015 and June 30, 2016, respectively)		31,308		44,664		6,721		44,664		6,721

F-47

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS (continued)

As of December 31, 2015 and June 30, 2016

(In thousands, except for share and per share data)

	As of December 31, 2015		As of June 30, 2016
	RMB		RMB		US$ Note 2(c)		RMB Pro forma (Note 15)		US$ Note 2(c) Pro forma (Note 15)
Advance from customers (including advance from customers of the consolidated VIEs without recourse to the primary beneficiaries of RMB104,605 and RMB104,389 as of December 31, 2015 and June 30, 2016, respectively)		104,605		104,389		15,707		104,389		15,707
Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to the primary beneficiaries of RMB68,454 and RMB71,282 as of December 31, 2015 and June 30, 2016, respectively)		70,908		73,522		11,062		73,522		11,062
Total current liabilities		360,133		460,180		69,243		460,180		69,243
Total liabilities		360,133		460,180		69,243		460,180		69,243
Commitments and contingencies (Note 17)
Mezzanine equity:
Series A convertible preferred shares (US$0.001 par value; 3,125,000 shares authorized, issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; aggregate liquidation value of nil as of December 31, 2015 and June 30, 2016, respectively; and none outstanding on a pro forma basis as of June 30, 2016)		40,181		41,919		6,307		—		—
Series A-1 convertible preferred shares (US$0.001 par value; 1,302,084 shares authorized, issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; aggregate liquidation value of nil as of December 31, 2015 and June 30, 2016, respectively; and none outstanding on a pro forma basis as of June 30, 2016)		28,492		29,789		4,482		—		—
Series B convertible preferred shares (US$0.001 par value; 2,962,239 shares authorized, issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; aggregate liquidation value of nil as of December 31, 2015 and June 30, 2016, respectively; and none outstanding on a pro forma basis as of June 30, 2016)		126,641		134,334		20,213		—		—

F-48

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS (continued)

As of December 31, 2015 and June 30, 2016

(In thousands, except for share and per share data)

	As of December 31, 2015			As of June 30, 2016
	RMB			RMB			US$ Note 2(c)			RMB Pro forma (Note 15)			US$ Note 2(c) Pro forma (Note 15)
Series C convertible preferred shares (US$0.001 par value; 4,640,843 shares authorized, issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; aggregate liquidation value of nil as of December 31, 2015 and June 30, 2016, respectively; and none outstanding on a pro forma basis as of June 30, 2016)		280,704			293,565			44,172			—			—
Total mezzanine equity		476,018			499,607			75,174			—			—
Shareholders' (deficit)/equity:
Ordinary shares—Class A (US$0.001 par value; and 4,543,461 shares authorized, issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; and 4,543,461 shares outstanding on a pro forma basis as of June 30, 2016)		31			31			5			31			5
Ordinary shares—Class B (US$0.001 par value; 33,426,373 shares authorized, 5,456,539 shares issued and outstanding as of December 31, 2015 and June 30, 2016, respectively; and 17,486,705 shares outstanding on a pro forma basis as of June 30, 2016)		37			37			6			117			18
Additional paid-in capital		—			—			—			499,527			75,162
Accumulated other comprehensive loss		(19,052	)		(30,213	)		(4,546	)		(30,213	)		(4,546	)
Accumulated deficit		(191,644	)		(227,104	)		(34,172	)		(227,104	)		(34,172	)
Total Gridsum's shareholders' (deficit)/equity		(210,628	)		(257,249	)		(38,707	)		242,358			36,467
Noncontrolling interests		384			357			54			357			54
Total shareholders' (deficit)/equity		(210,244	)		(256,892	)		(38,653	)		242,715			36,521
Total liabilities, mezzanine equity and shareholders' (deficit)/equity		625,907			702,895			105,764			702,895			105,764

The accompanying notes are an integral part of these consolidated financial statements.

F-49

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Six Months Ended June 30, 2015 and 2016
(In thousands, except for share and per share data)

	For the Six Months Ended June 30,
	2015			2016			2016
	RMB			RMB			US$ Note 2(c)
Revenues:
Enterprise		75,483			133,918			20,150
e-Government and other		10,029			16,648			2,505
Less: Business tax and surcharges		(878	)		(2,499	)		(376	)
Net revenues		84,634			148,067			22,279
Cost of revenue(1)		(11,500	)		(20,023	)		(3,013	)
Gross profit		73,134			128,044			19,266
Operating expenses(1):
Sales and marketing expenses		(33,351	)		(52,214	)		(7,857	)
Research and development expenses		(40,178	)		(66,956	)		(10,075	)
General and administrative expenses		(27,861	)		(37,466	)		(5,637	)
Total operating expenses		(101,390	)		(156,636	)		(23,569	)
Losses from operations		(28,256	)		(28,592	)		(4,303	)
Other income/(expense):
Foreign currency exchange gain/(loss)		672			(889	)		(134	)
Interest income, net		26			189			28
Other expense, net		—			(417	)		(63	)
Loss before income tax		(27,558	)		(29,709	)		(4,472	)
Income tax expense		—			—			—
Net loss		(27,558	)		(29,709	)		(4,472	)
Less: Net loss attributable to noncontrolling interests		—			(27	)		(4	)
Net loss attributable to Gridsum Holding Inc.		(27,558	)		(29,682	)		(4,468	)
Accretions to preferred shares redemption value		(9,131	)		(11,050	)		(1,663	)
Cumulative dividend to preferred shareholders		(8,240	)		(8,659	)		(1,303	)
Net loss attributable to Gridsum's ordinary shareholders		(44,929	)		(49,391	)		(7,434	)
Net loss		(27,558	)		(29,709	)		(4,472	)
Foreign currency translation adjustment, net of nil tax		(1,053	)		(11,161	)		(1,679	)
Comprehensive loss		(28,611	)		(40,870	)		(6,151	)
Comprehensive loss attributable to Gridsum Holding Inc.		(28,611	)		(40,870	)		(6,151	)
Net loss per share attributable to Gridsum's ordinary shareholders, basic and diluted		(4.49	)		(4.94	)		(0.74	)
Weighted average shares outstanding used in computing net income per share attributable to Gridsum's ordinary shareholders		10,000,000			10,000,000			10,000,000

Note:

(1)

Share-based compensation expenses were allocated in cost of revenues and operating expenses as follows:

Cost of revenues	146	182	27
Sales and marketing expenses	650	1,075	162
Research and development expenses	1,515	1,966	296
General and administrative expenses	1,642	2,049	308

The accompanying notes are an integral part of these consolidated financial statements.

F-50

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF
CHANGES IN SHAREHOLDERS' DEFICIT

For the Six Months Ended June 30, 2015 and 2016
(In thousands, except for share and per share data)

	Ordinary Shares							Accumulated Other Comprehensive Income /(Loss)
					Additional Paid-in Capital						Accumulated Deficit			Noncontrolling Interests			Total Shareholders' Deficit
	Shares		Amount
			RMB		RMB			RMB			RMB			RMB			RMB
Balances as of January 1, 2015		10,000,000		68		2,436			320			(134,360	)		—			(131,536	)
Preferred shares accretion		—		—		(6,389	)		—			(2,742	)		—			(9,131	)
Share-based compensation expenses		—		—		3,953			—			—			—			3,953
Net loss		—		—		—			—			(27,558	)		—			(27,558	)
Foreign currency translation adjustments, net of tax		—		—		—			(1,053	)		—			—			(1,053	)
Balances as of June 30, 2015		10,000,000		68		—			(733	)		(164,660	)		—			(165,325	)
Balances as of January 1, 2016		10,000,000		68		—			(19,052	)		(191,644	)		384			(210,244	)
Preferred shares accretion		—		—		(5,272	)		—			(5,778	)		—			(11,050	)
Share-based compensation expenses		—		—		5,272			—			—			—			5,272
Net loss		—		—		—			—			(29,682	)		(27	)		(29,709	)
Foreign currency translation adjustments, net of tax		—		—		—			(11,161	)		—			—			(11,161	)
Balances as of June 30, 2016		10,000,000		68		—			(30,213	)		(227,104	)		357			(256,892	)

The accompanying notes are an integral part of these consolidated financial statements.

F-51

Gridsum Holding Inc.

UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2015 and 2016
(In thousands, except for share and per share data)

	For the Six Months Ended June 30,
	2015			2016			2016
	RMB			RMB			US$ Note 2(c)
Cash flows from operating activities:
Net loss		(27,558	)		(29,709	)		(4,472	)
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for allowance for doubtful accounts		269			1,320			199
Share-based compensation expenses		3,953			5,272			793
Depreciation and amortization expenses		5,958			10,852			1,633
Loss on disposal of equipment and leasehold improvements		—			137			21
Foreign currency exchange (loss)/gain, net		(600	)		905			138
Changes in operating assets and liabilities:
Accounts receivable		(130,295	)		(140,441	)		(21,132	)
Prepayments and other current assets		(45,849	)		(11,437	)		(1,721	)
Accounts payable		14,492			66,175			9,957
Amounts due to related parties		(313	)		—			—
Salary and welfare payable		(4,596	)		(709	)		(107	)
Taxes payable		1,832			8,827			1,328
Deferred revenues		5,710			13,356			2,010
Advance from customers		10,435			(216	)		(33	)
Accrued expenses and other current liabilities		(4,158	)		(150	)		(23	)
Net cash used in operating activities		(170,720	)		(75,818	)		(11,409	)
Cash flows from investing activities:
Proceeds from disposal of property, equipment and software		—			73			11
Purchase of property and equipment and software		(9,024	)		(17,775	)		(2,675	)
Net cash used in investing activities		(9,024	)		(17,702	)		(2,664	)
Cash flows from financing activities:
Capital injection from noncontrolling interest shareholders		—			400			60
Proceeds from issuance of Series C preferred shares		262,561			—			—
Payment of financing costs in connection with the issuance of Series C preferred shares		(1,061	)		—			—
Proceeds of bank loan		—			10,000			1,505
Net cash provided by financing activities		261,500			10,400			1,565
Effect of exchange rate changes on cash and cash equivalents		(2,871	)		260			41
Net increase/(decrease) in cash and cash equivalents		78,885			(82,860	)		(12,467	)
Cash and cash equivalents at the beginning of the period		61,830			198,523			29,871
Cash and cash equivalents at the end of the period		140,715			115,663			17,404
Supplemental schedule of non-cash investing activities:
Fixed asset purchases financed by accrued expenses and other current liabilities		276			2,660			400
Fixed asset purchases transferred from other non-current assets		(66	)		2,273			342
Supplemental schedule of non-cash financing activities:
Accretions to preferred shares redemption value		9,131			11,050			1,663

The accompanying notes are an integral part of these consolidated financial statements.

F-52

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except for share and per share data)

1. Organization and Principal Activities

(a)

Principal activities

        Gridsum Holding Inc. ("Company"), through its consolidated subsidiaries and variable interest entities ("VIEs") (collectively referred to as the "Group"), provides digital intelligence solutions in the People's Republic of China ("PRC").

        The accompanying unaudited interim consolidated financial statements include the unaudited interim financial statements of the Company, its subsidiaries, VIEs and VIE subsidiaries. As of June 30, 2016, the Company's operating subsidiaries, operating VIE and operating VIE subsidiaries were as follows:

Operating Subsidiaries	Equity interests held		Place and Date of Incorporation
Gridsum Holding (China) Limited		100%	Hong Kong, July 2014
Dissector (Beijing) Technology Co., Ltd.		100%	PRC, October 2014

Operating VIE	Economic interests held		Place and Date of Incorporation
Gridsum Holding (Beijing) Co.,Ltd.		100%	PRC, August 2014

Operating VIE Subsidiaries	Economic interests held		Place and Date of Incorporation
Beijing Gridsum Technology Co., Ltd.		100%	PRC, December 2005
Beijing Moment Everlasting Ad Co., Ltd.		100%	PRC, January 2011
Guoxinjunhe (Beijing) Technology Co., Ltd.		100%	PRC, April 2012
Beijing Yunyang Advertisement Co., Ltd.		100%	PRC, March 2013
Beijing Guoxinwangyan Technology Co., Ltd.		80%	PRC, August 2015
Beijing Gridsum Yizhun Technology Co., Ltd		100%	PRC, February 2016

(b)

Reorganization

        The Company was incorporated in the Cayman Islands on July 21, 2014.

        The Group began operations in December 2005 through Beijing Gridsum Technology Co., Ltd. ("Beijing Gridsum"), a PRC domestic company established by our founders. Beijing Gridsum established two wholly owned subsidiaries, Beijing Moment Everlasting Ad Co., Ltd. ("Beijing Moment") and Guoxinjunhe (Beijing) Technology Co., Ltd. ("Guoxinjunhe"), in January 2011 and April 2012, respectively. Beijing Moment established a wholly owned subsidiary, Beijing Yunyang Ad Co., Ltd. ("Beijing Yunyang") in March 2013.

        From July to December 2014, the Group undertook a reorganization ("2014 Restructuring") and established the Company under the laws of the Cayman Islands; the Company established a wholly owned Hong Kong subsidiary, Gridsum Holding (China) Limited ("Gridsum HK"), which in turn established a wholly owned subsidiary in China, Dissector (Beijing) Technology Co. Ltd. ("WFOE"). Also as part of this 2014 Restructuring, Gridsum Holding (Beijing) Co., Ltd. ("Gridsum PRC Holding") was established to acquire full ownership of Beijing Gridsum, Beijing Moment and Guoxinjunhe from Beijing Gridsum.

        On December 22, 2014, the WFOE entered into a series of contractual agreements ("VIE agreements") with Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, as a result

F-53

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

of which Gridsum PRC Holding became a VIE of which the Company is the primary beneficiary, and the Company consolidates the financial results of Gridsum PRC Holding and its subsidiaries. Prior to the 2014 Restructuring, the Group was controlled by a predecessor Cayman Islands entity, which through another restructuring in 2010 ("2010 Restructuring") controlled the Group entities in China according to a set of contractual arrangements containing terms and conditions identical to those of the VIE agreements. The 2010 Restructuring was undertaken in order to facilitate an international financing completed in September 2010 as well as to comply with relevant government regulations and policies in the PRC. The VIE agreements have superseded the 2010 contractual arrangements. Prior to the 2010 Restructuring, the Group's founders and management held 100% of the beneficial ownership interest in Beijing Gridsum. In the 2010 Restructuring, the predecessor Cayman Islands entity was established with the same beneficial ownership structure as Beijing Gridsum. Therefore, the Group's founders and management held 100% of the beneficial ownership interests in, and maintained control of, the Group immediately before and after the 2010 Restructuring.

        In the 2014 Restructuring, the Company was established with the same beneficial ownership structure as the predecessor Cayman Islands entity. Therefore, the Group's founders, management and the then outstanding Preferred Shareholders held 100% of the beneficial ownership interests in, and maintained control of, the Group immediately before and after the 2014 Restructuring.

        The entities included in the 2010 Restructuring and 2014 Restructuring were under common control and the two reorganizations have been accounted for in a manner akin to a pooling of interest as if the Company, through its wholly owned subsidiaries, had been in existence and been the primary beneficiary of the VIEs throughout the periods presented in the consolidated financial statements.

(c)

Contracts with Variable Interest Entities

        To comply with applicable PRC laws and regulations, the Group conducts operations in China principally through Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang, Beijing Guoxinwangyan Technology Co., Ltd and Beijing Gridsum Yizhun Technology Co., Ltd. The WFOE has entered into a series of contractual arrangements with the parent of these companies, Gridsum PRC Holding, and the shareholders of Gridsum PRC Holding. These contractual arrangements allow the Company to exercise effective control over Gridsum PRC Holding and to receive substantially all of the economic benefits of Gridsum PRC Holding. As a result of these contractual arrangements, the Company is the primary beneficiary of Gridsum PRC Holding, and the Company treats it as a VIE in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The following is a summary of the currently effective contractual arrangements among the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding:

        Exclusive Business Cooperation Agreement.    Under the Exclusive Business Cooperation Agreement dated December 22, 2014, between the WFOE and Gridsum PRC Holding, Gridsum PRC Holding has appointed the WFOE as its exclusive provider of technical support, business support and related consulting services and has agreed to accept all consultations and services provided by the WFOE and, without prior written consent of the WFOE, not to accept the same or any similar consultations and/or services provided by, or establish similar cooperation relationships with, any third party. In consideration of the services provided by the WFOE, Gridsum PRC Holding has agreed to pay the WFOE, on a quarterly basis, service fees equal to 90% of Gridsum PRC Holding's net income (which equals gross income less mutually agreed costs). The parties can reasonably adjust the calculation of

F-54

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

such service fees. The WFOE shall have exclusive and proprietary rights and interests in all rights, ownership, interests and intellectual property owned and used by the WFOE during the performance of the agreement. The term of the agreement is 10 years and may be extended if confirmed in writing by the WFOE prior to expiration (and Gridsum PRC Holding shall unconditionally accept such extension). Gridsum PRC Holding shall not terminate the agreement prior to its expiration, unless the WFOE commits gross negligence or fraudulent act against Gridsum PRC Holding, whereas the WFOE may terminate the agreement upon giving 30 days' prior written notice to Gridsum PRC Holding at any time.

        Exclusive Option Agreements.    Under the Exclusive Option Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding granted to the WFOE an irrevocable and exclusive right to purchase, or designate other person(s) to purchase, to the extent permitted by PRC laws, at any time all or part of such shareholders' equity interests in Gridsum PRC Holding. The purchase price shall be equal to the registered capital of Gridsum PRC Holding multiplied by the portion of equity interests to be purchased and RMB10.00, or, if there is any mandatory provision regarding the purchase price under PRC laws, the lowest price permitted by PRC laws. Without prior written consent of the WFOE, Gridsum PRC Holding shall not: (i) supplement, change or amend its articles of association, increase or decrease its registered capital or change its capital structure in any manner, (ii) sell, transfer, mortgage or dispose of or create security interest on, its assets, business or legal right to collect interests, (iii) create, succeed to, guarantee or permit any debt, except for debts arising in the course of the ordinary or daily business operation, (iv) enter into any material contract (i.e., any contract with a value exceeding RMB1,000,000), or (v) provide loan or credit to Gridsum PRC Holding's shareholders in any form; and the shareholders of Gridsum PRC Holding shall not sell, transfer, mortgage or dispose of or create security interest on, such shareholders' legal or beneficial interest in the equity interests in Gridsum PRC Holding. The term of these agreements is 10 years and may be renewed at the WFOE's election.

        Shareholders' Voting Rights Proxy Agreements.    Under the Shareholders' Voting Rights Proxy Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding irrevocably authorize the WFOE or its designee to act on their behalf as their exclusive agent and attorney with respect to all matters concerning their shareholder rights, including, without limitation, to propose, convene and attend shareholder meetings as the proxy of such shareholders and to exercise all of such shareholder's voting rights provided under PRC laws or the articles of association of Gridsum PRC Holding. Each agreement will remain effective until the equity interest of the respective shareholder in Gridsum PRC Holding is transferred to the WFOE.

        Equity Pledge Agreements.    Under the Equity Pledge Agreements dated December 22, 2014, between the WFOE, Gridsum PRC Holding and the shareholders of Gridsum PRC Holding, the shareholders of Gridsum PRC Holding pledge all of their equity interests in Gridsum PRC Holding to the WFOE as security for the performance of the obligations of Gridsum PRC Holding and its shareholders under the Exclusive Business Cooperation Agreement, the Exclusive Option Agreements and the Shareholders' Voting Rights Proxy Agreements. In the event of breach of any secured obligation by Gridsum PRC Holding or the respective shareholder, the WFOE is entitled to all remedial rights and powers afforded under PRC laws, including to receive proceeds from auctions or

F-55

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

sale-offs of the pledged equity. No dividend or distribution can be paid or made to the shareholders in respect of the pledged equity unless consented by the WFOE, and the dividends or distributions received by the shareholders shall first be applied to satisfy the secured obligations. The pledges will be released upon the full and complete performance of the secured obligations and the full payment of losses and fees resulted from a breach of those agreements by Gridsum PRC Holding or its shareholders. The equity pledges have been registered with the registration authorities of industry and commerce in accordance with PRC laws.

        In addition to the contractual agreements described above, the Company has entered into an Exclusive Rights Arrangement with the predecessor Cayman Islands entity on December 22, 2014. Under this agreement, the Company exercises effective control over the predecessor Cayman Islands entity and receives substantially all of the economic benefits of the predecessor Cayman Islands entity. As a result of this agreement, the Company is the primary beneficiary of the predecessor Cayman Islands entity, and the Company treats it as a VIE. The Company consolidates the financial results of the predecessor Cayman Islands entity and its subsidiaries in the Company's consolidated financial statements. The following is a summary of the Exclusive Rights Arrangement among the Company, the predecessor Cayman Islands entity and the shareholders of the predecessor Cayman Islands entity that was in effect until termination on August 10, 2015 in connection with the completion of the 2014 Restructuring:

        All the shareholders agreed to irrevocably assign and entrust to the Company any and all of their respective voting rights and dividends rights with respect to any and all of the equity securities they held in the predecessor Cayman Islands entity. All the actions associated with any shareholder's voting rights conducted by the Company shall be deemed as such shareholders' own actions, and all the shareholders' resolutions executed by the Company shall be deemed to be executed by all of the shareholders themselves. Each shareholder agreed to refrain from exercising any of the voting rights associated with its shareholding in the predecessor Cayman Islands entity, all of which have been authorized and entrusted to the Company. If a dividend or other distribution is declared, paid or set aside, each shareholder shall immediately transfer to the Company any and all of such dividend or distribution. No dividend or distribution, whether in cash, in property or in any other equity securities of the predecessor Cayman Islands entity, shall be declared, paid, set aside or made without the written consent of the Company.

Risks in relation to the VIE structure

        In the opinion of the Company's management, the contractual arrangements discussed above have resulted in the Company and the WFOE having the power to direct activities that most significantly impact the VIEs and VIE subsidiaries, including appointing key management, setting up operating policies, exerting financial controls and transferring profit or assets out of the VIEs and VIE subsidiaries at its discretion. The Company and the WFOE believe they have the right to receive all the benefits and assets of the VIEs and VIE subsidiaries, except for registered capital of the VIEs and VIE subsidiaries totaling RMB124,000 and RMB124,000 as of December 31, 2015 and June 30, 2016, respectively. As the VIEs and VIE subsidiaries organized in the PRC were established as limited liability companies under PRC law, their creditors do not have recourse to the general credit of the WFOE for the liabilities of these VIEs and VIE subsidiaries, and the WFOE does not have the obligation to assume the liabilities of these VIEs and VIE subsidiaries.

F-56

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

        The Company believes that its contractual arrangements with the VIEs are in compliance with PRC law and are legally enforceable. In addition, the shareholders of Gridsum PRC Holding are also beneficial owners of the Company and therefore have no current interest in seeking to act contrary to the contractual arrangements. However, uncertainties in the PRC legal system could limit the Group's ability to enforce the VIE agreements.

        On January 19, 2015, the Ministry of Commerce ("MOFCOM"), released for public comment a proposed PRC law, the Draft FIE Law, that appears to include VIEs within the scope of entities that could be considered to be foreign invested enterprises, or FIEs, that would be subject to restrictions under existing PRC law on foreign investment in certain categories of industry. Specifically, the Draft FIE Law introduces the concept of "actual control" for determining whether an entity is considered to be an FIE. In addition to control through direct or indirect ownership or equity, the Draft FIE Law includes control through contractual arrangements within the definition of "actual control." If the Draft FIE Law is passed by the People's Congress of the PRC and goes into effect in its current form, these provisions regarding control through contractual arrangements could be construed to reach our VIE arrangements, and as a result our PRC-organized VIEs could become explicitly subject to the current restrictions on foreign investment in certain categories of industry. The Draft FIE Law includes provisions that would exempt from the definition of foreign invested enterprises entities where the ultimate controlling shareholders are either entities organized under PRC law or individuals who are PRC citizens. The Draft FIE Law is silent as to what type of enforcement action might be taken against existing VIEs, such as Gridsum PRC Holding, that operate in restricted or prohibited industries and are not controlled by entities organized under PRC law or individuals who are PRC citizens. If the restrictions and prohibitions on foreign invested enterprises included in the Draft FIE Law are enacted and enforced in their current form, our ability to use our VIE arrangements and our ability to conduct business through them could be severely limited.

        The Company's ability to control Gridsum PRC Holding and its subsidiaries also depends on the WFOE's rights, under the Shareholders' Voting Rights Proxy Agreements, to vote on all matters requiring shareholder approval. As noted above, the Company believes these Shareholders' Voting Rights Proxy Agreements are legally enforceable, but yet they may not be as effective as direct equity ownership. In addition, if the corporate structure of the Group or the contractual arrangements between the WFOE, Gridsum PRC Holding and their respective shareholders were found to be in violation of any existing PRC laws and regulations, the relevant PRC regulatory authorities could:

•

revoke the Group's business and operating licenses;

•

require the Group to discontinue or restrict its operations;

•

restrict the Group's right to collect revenues;

•

block Group websites;

•

require the Group to restructure the operations, re-apply for the necessary licenses or relocate its businesses, staff and assets;

•

impose additional conditions or requirements with which the Group may not be able to comply; or

•

take other regulatory or enforcement actions against the Group that could be harmful to the Group's business.

F-57

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

        The imposition of any of these restrictions or actions may result in a material adverse effect on the Group's ability to conduct its business. In addition, if the imposition of any of these restrictions causes the Company to lose the right to direct the activities of the Gridsum PRC Holding or the right to receive its economic benefits, the Company would no longer be able to consolidate the financial statements of Gridsum PRC Holding and its subsidiaries. The Company believes the likelihood of losing the benefits of the Group's current ownership structure and contractual arrangements with Gridsum PRC Holding is remote based on the current facts and circumstances.

        There is no VIE in which the Group has a variable interest but is not the primary beneficiary. Currently there is no contractual arrangement that could require the Group to provide additional financial support to the VIEs.

        The consolidated financial information of the VIEs and VIE subsidiaries, including the inter-group transactions with other entities in the Group, has been included in the accompanying consolidated financial statements of the Company as follow:

	As of
	December 31, 2015		June 30, 2016
	RMB		RMB
Cash and cash equivalents		166,421		112,122
Accounts receivable, net		279,537		418,658
Prepayments and other current assets		100,905		108,483
Property, equipment and software, net		36,243		47,889
Other non-current assets		4,558		2,285
Total assets		587,664		689,437
Short-term bank loan		—		10,000
Accounts payable		103,289		169,464
Amounts due to related parties		248,982		255,491
Salary and welfare payables		32,887		32,202
Taxes payable		16,484		25,311
Deferred revenues		31,308		44,664
Advance from customers		104,605		104,389
Accrued expenses and other current liabilities		68,454		71,282
Total liabilities		606,009		712,803

	For the six months ended June 30,
	2015			2016
	RMB			RMB
Net revenues		84,634			148,067
Net loss		(24,611	)		(11,191	)

F-58

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

1. Organization and Principal Activities (continued)

	For the Six Months Ended June 30,
	2015			2016
	RMB			RMB
Net cash used in operating activities		(59,057	)		(46,997	)
Net cash used in investing activities		(8,699	)		(17,702	)
Net cash provided by financing activities		57,473			10,400

        In accordance with various contractual agreements, the Company has the power to direct the activities of the VIEs and can have assets transferred out of the VIEs. Therefore, the Company considers that there are no assets in the consolidated VIEs that can be used only to settle obligations of the consolidated VIEs, except for registered capital of the VIEs and VIE subsidiaries totaling RMB124,000 as of December 31, 2015 and RMB124,000 as of June 30, 2016. As the consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors do not have recourse to the general credit of the Company for the liabilities of the consolidated VIEs.

Liquidity

        The Group has been incurring recurring losses from operations since inception. Accumulated losses from operation were RMB183,179 and RMB212,861 as of December 31, 2015 and June 30, 2016, respectively. The net cash used in operating activities were RMB170,720 and RMB75,818 for the six months ended June 30, 2015 and 2016, respectively.

        The Group's ability to fund operations is based on its ability to generate cash, its ability to attract investors and its ability to borrow funds on reasonable economic terms. Historically, the Group has relied principally on both operational sources of cash and non-operational sources of financing from investors to fund its operations and business development. The Group's ability to continue as a going concern is dependent on management's ability to successfully execute its business plan, which includes increasing revenues while controlling operating expenses, as well as, generating operational cash flows and continuing to gain support from outside sources of financing. The Group has been continuously receiving financing support from outside investors. The latest round of external capital financing was completed in March 2015 (see Note 11). In addition, if the Company successfully completes a qualified initial public offering before September 2017, thereby triggering the automatic conversion of all series of preferred shares into ordinary shares, it will eliminate the possibility of any future cash outflow that may result from preferred shareholders exercising their share redemption rights. In the event the initial public offering has to be deferred to beyond September 2017, management is of the opinion that the Group will be able to continue to gain the support from its existing investors, and management does not foresee a request for shares redemption from its preferred shareholders. In addition, a VIE subsidiary obtained a banking facility of RMB25,000 from China Merchants Bank in June 2016, RMB10,000 of which had been utilized as of June 30, 2016 (see Note 8). Moreover, the Company can adjust the pace of its expansion and control Group operating expenses. Based on the above considerations, the Company's consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.

F-59

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies

(a)

Basis of presentation

        The accompanying unaudited interim consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited financial statements and include all adjustments as necessary for the fair statement of the Company's financial position, results of operations and cash flows for the six months ended June 30, 2015 and 2016.

        The unaudited interim consolidated financial statements and related disclosures have been prepared with the presumption that users of the unaudited interim consolidated financial statements have read or have access to the audited consolidated financial statements for the preceding fiscal year. The consolidated balance sheet at December 31, 2015 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, 2013, 2014 and 2015.

        Following the issuance of the interim consolidated financial statements for the six months ended June 30, 2015, the Company identified errors in the following items.

(i)

An error in the presentation of additional paid-in capital and of accumulated deficit, which was related to the calculation of accretion to preferred shares redemption value in the consolidated balance sheets and consolidated statements of changes in shareholders' deficit. The error was due to accretion to preferred shares redemption value that was incorrectly recorded by increasing the accumulated deficit when additional paid-in capital had not been exhausted as of January 1, 2015, and June 30, 2015.



(ii)

An error in the calculation of cumulative dividend to preferred shareholders, net loss attributable to ordinary shareholders and basic and diluted net loss per share attribute to ordinary shareholders. The error was due to the incorrect calculation of cumulative dividend to preferred shareholders, resulting in an error in calculating net loss attributable to ordinary shareholders and basic and diluted net loss per share attribute to ordinary shareholders for the six months ended June 30, 2015.

        The Company has evaluated the impact of these items under the guidance in ASC 250, "Accounting Changes and Error Corrections" and SEC Staff Accounting Bulletin No. 99, "Materiality" and concluded that the errors were not material to the consolidated financial statements. The Company has revised the consolidated financial statements for the six months ended June 30, 2015 to reflect the correction of these items. The amounts of the corrections are shown in the Revision column in the table below.

	June 30, 2015
Consolidated Balance Sheet	As previously reported			Revision			As revised
	RMB			RMB			RMB
Shareholders' deficit
Additional paid-in capital		26,582			(26,582	)		—
Accumulated deficit		(191,242	)		26,582			(164,600	)

F-60

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

	For the Six Months Ended June 30, 2015
Consolidated Statements of Comprehensive Loss	As previously reported			Revision		As revised
	RMB			RMB		RMB
Cumulative dividend to preferred shareholders		(44,003	)		35,763		(8,240	)
Net loss attributable to Gridsum's ordinary shareholders		(80,692	)		35,763		(44,929	)
Net loss per share attributable to Gridsum's ordinary shareholders, basic and diluted		(8.07	)		3.58		(4.49	)

(b)

Foreign currency translation

        Effective January 1, 2016, the Group changed its reporting currency from United States dollars ("USD") to RMB. The change in reporting currency is to better reflect the Company's performance and to improve investors' ability to compare the Company's financial results with other publicly traded companies in the industry. Assets and liabilities are translated at the applicable exchange rates on the balance sheet date. Equity amounts are translated at historical exchange rates. Revenues, expenses, gains and losses are translated using the average exchange rate for the periods. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income or loss in the consolidated statement of changes in shareholders' deficit.

        Foreign currency transactions denominated in currencies other than functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are remeasured at the applicable rates of exchange in effect at that date. Foreign exchange gains and losses resulting from the settlement of such transactions and from remeasurement at year-end are recognized in foreign currency exchange gain/(loss), net in the consolidated statements of operations and comprehensive loss.

(c)

Convenience Translation

        Translations of balances in the consolidated balance sheets, consolidated statements of operation and comprehensive loss and statements of cash flows from RMB into U.S. Dollar as of and for the six months ended June 30, 2016 are solely for the convenience of the reader and were calculated at the rate of US$1.00 = RMB6.6459, representing the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on June 30, 2016. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into U.S. Dollar at that rate on June 30, 2016, or at any other rate.

F-61

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

2. Principal Accounting Policies (continued)

(d)

Recent Accounting Pronouncements

        In February 2016, the FASB issued ASU2016-02, "Leases (Topic 842)". The new guidance requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Public business entities should apply the amendments in ASU 2016-02 for fiscal years beginning after December 15, 2018,including interim periods within those fiscal years (i.e., January 1, 2019, fora calendar year entity). Early application is permitted for all public business entities and all non public business entities upon issuance. The Company is currently evaluating the impact of this guidance.

        In March 2016, the FASB issued ASU No. 2016-09, "Improvements to Employee Share-Based Payment Accounting (Topic 718)". The new update will require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled. It also will allow an employer to repurchase more of an employee's shares than it can today for tax withholding purposes without triggering liability accounting and to make a policy election to account for forfeitures as they occur. The guidance is effective for the Company on January 1, 2017. Early application is permitted in any annual or interim period for which financial statements haven't been issued or made available for issuance, but all of the guidance must be adopted in the same period. The Company is currently evaluating the impact of this guidance.

        In April and May 2016, the FASB issued ASU No. 2016-10, "Identifying Performance Obligations and Licensing (Topic 606)" and ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients". Both of the amendments in these updates do not change the core principle of the guidance in Topic 606. The new update in ASU No. 2016-10 clarifies the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. The new update in ASU No. 2016-12 affects only the narrow aspects of Topic 606, such as Assessing the Collectibility Criterion in Paragraph 606-10-25-1(e) and Accounting for Contracts That Do Not Meet the Criteria for Step 1 (Applying Paragraph 606-10-25-7), Presentation of Sales Taxes and Other Similar Taxes Collected from Customers, Contract Modifications at Transition and Contract Modifications at Transition. The effective date and transition requirements for the amendments in these updates are the same as the effective date and transition requirements for Topic 606 (and any other topic amended by ASU No. 2014-09). The Company is currently evaluating the impact of this guidance.

3. Concentration and Risks

Concentration of search engine providers

        The Company received revenues from an incentive program administered by a search engine provider based on factors determined by the provider, such as yearly growth in the amount of advertising on the provider's search engine platform that the Company's customers purchased through

F-62

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

3. Concentration and Risks (continued)

the Company's solutions and other factors selected at the discretion of the provider. The Company's revenues from this program, as a percentage of the Company's total revenues for the six months ended June 30, 2015 and 2016, were as follows:

	For the Six Months Ended June 30,
	2015	2016
Revenues from the incentive program of a search engine provider	Below 10%	Below 10%

Concentration of credit risk

        Assets that potentially subject the Group to significant concentrations of credit risk primarily consist of cash and cash equivalents and accounts receivable. As of December 31, 2015 and June 30, 2016, all of the Group's cash and cash equivalents were held by reputable financial institutions located in the PRC, Hong Kong and the United States, which management believes are of high credit quality and financially sound based on public available information.

        Accounts receivable is typically unsecured and is generally derived from revenues earned from marketing automation solutions. Customers with a receivable balance exceeding 10% of the total accounts receivable balance, net of allowance for doubtful accounts, as of December 31, 2015 and June 30, 2016, are listed as follows:

	As of
	December 31, 2015			June 30, 2016
Customer A		31.8	%		50.0	%

Currency risk

        The Group's operation transactions and its assets and liabilities are primarily denominated in RMB, which is not freely convertible into foreign currencies. The Group's cash and cash equivalents denominated in RMB are subject to such government controls and amounted to RMB178,577 and RMB112,183 as of December 31, 2015 and June 30, 2016, respectively. The value of the RMB is subject to changes in the central government policies and international economic and political developments that affect the supply and demand of RMB in the foreign exchange market. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the People's Bank of China (the "PBOC"). Remittances from China in currencies other than RMB by the Group must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to effect the remittance.

4. Fair Value Measurement

        The Group measured its financial assets and liabilities which consist entirely of cash and cash equivalents at fair value on a recurring basis as of December 31, 2015 and June 30, 2016. Cash and

F-63

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

4. Fair Value Measurement (continued)

cash equivalents are classified within Level 1 of the fair value hierarchy because they are valued based on the quoted market price in an active market.

        The rates of interest under the loan agreements with the lending banks were determined based on the prevailing interest rates in the market, which are also the interest rates as stated in the contracts with the lending banks. This is because there generally are no quoted prices in active markets for identical short term loan at the reporting date. Hence, in order to determine the fair value, the Company must use observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements of short-term bank loan.

5. Accounts Receivable

        The following summarizes the Group's accounts receivable as of December 31, 2015 and June 30, 2016:

	As of
	December 31, 2015			June 30, 2016
	RMB			RMB
Accounts receivable		280,801			421,242
Less: Allowance for doubtful accounts		(1,264	)		(2,584	)
Accounts receivable, net		279,537			418,658

        The amount of payments to service providers on behalf of customers included in accounts receivable was RMB230,884 and RMB354,612 as of December 31, 2015 and June 30, 2016, respectively.

        The following table sets out the movements of the allowance for doubtful accounts for the six months ended June 30, 2015 and 2016:

	As of June 30,
	2015			2016
	RMB			RMB
Balance at beginning of the six months		(92	)		(1,264	)
Charged to costs and expenses		(269	)		(1,320	)
Balance at end of the six months		(361	)		(2,584	)

F-64

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

6. Prepayments and Other Current Assets

        The following is a summary of prepayments and other current assets:

	As of
	December 31, 2015		June 30, 2016
	RMB		RMB
Deposits to search engine service providers		85,417		81,187
Prepayment to suppliers		12,574		29,120
Prepaid rental and other deposits		4,272		5,380
Advances to employees		3,709		2,214
Others		1,074		499
Total		107,046		118,400

        Deposits to search engine service providers represent deposits to guarantee the minimum amount of ad spending by the Group's customers and are refunded annually when the minimum ad spending requirement is met.

7. Property, Equipment and Software, net

        The following is a summary of property, equipment and software, net:

	As of
	December 31, 2015			June 30, 2016
	RMB			RMB
Computers and software		36,988			53,854
Furniture, fixtures and equipment		3,304			3,340
Vehicles		1,833			1,833
Leasehold improvements		16,341			21,599
Total		58,466			80,626
Less: accumulated depreciation and amortization		(22,223	)		(32,737	)
Property, equipment and software, net		36,243			47,889

        Depreciation and amortization expenses for the six months ended June 30, 2015 and 2016 were RMB5,958 and RMB10,852, respectively.

8. Short-term Bank Loan

        In June 2016, Beijing Gridsum entered into a short-term guaranteed loan arrangement with the China Merchants Bank. The revolving credit facility amounted to RMB25,000 with a fixed interest rate of 5.44% per annum and a maturity term of twelve months. A guarantee on the loan was provided by Guosheng Qi, the Co-Founder, Chief Executive Officer and Chairman of the Company and Beijing Moment. As of June 30, 2016, the Company borrowed RMB10,000 under this credit facility.

F-65

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

9. Accrued Expenses and Other Current Liabilities

        The following is a summary of accrued expenses and other current liabilities:

	As of
	December 31, 2015		June 30, 2016
	RMB		RMB
Customer deposits		54,677		58,729
Accrued expenses		15,489		14,210
Others		742		583
Total		70,908		73,522

10. Taxation

(a)

Value added tax

        The Group's revenues are subject to VAT at the rate of 6%. The Group's VAT payable balance amounted to RMB9,513 and RMB14,486 as of December 31, 2015 and June 30, 2016, respectively.

(b)

Income tax

Cayman Islands

        Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, the Cayman Islands does not impose a withholding tax on payments of dividends to shareholders.

Hong Kong

        Under the current Hong Kong Inland Revenue Ordinance, the Company's Hong Kong subsidiary is subject to Hong Kong profits tax at the rate of 16.5% on its taxable income generated from the operations in Hong Kong. Payments of dividends by the subsidiary to the Company are not subject to withholding tax in Hong Kong.

PRC

        The Group's subsidiaries, VIEs and VIE subsidiaries in the PRC are subject to the Enterprise Income Tax Law ("EIT Law") and are taxed at the statutory income tax rate of 25%.

        The EIT Law also provides that an enterprise established under the laws of a foreign country or region but whose "de facto management body" is located in the PRC be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The Implementing Rules of the EIT Law merely define the location of the "de facto management body" as "the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, property, etc., of a non-PRC company is located." Based on a review of surrounding facts and circumstances, the Group does not believe that it is likely that its operations outside the PRC should be considered a resident enterprise for PRC tax purposes.

F-66

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

        High and new technology enterprises ("HNTE") will enjoy a preferential enterprise income tax rate of 15% under the EIT Law. Beijing Gridsum Technology Co., Ltd. and Guoxinjunhe (Beijing) Technology Co., Ltd, the Group's consolidated affiliated entities in the PRC, which are qualified as a HNTE under the EIT Law, is eligible for a preferential enterprise income tax rate of 15% for the period from 2014 to 2016, so long as they obtain approval from relevant tax authority if they are profitable during the period.

Withholding tax on undistributed dividends

        The EIT Law also imposes a withholding income tax of 10% on dividends distributed by a FIE to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company's jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company is incorporated, does not have such tax treaty with China. According to the arrangement between Mainland China and Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion in August 2006, dividends paid by an FIE in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5% (if the foreign investor owns directly at least 25% of the shares of the FIE). The Group did not record any dividend withholding tax, as Gridsum PRC Holding, the PRC WFOE, has no retained earnings in any of the periods presented.

        Further, the Group did not have any income tax expenses for the six months ended June 30, 2015 and 2016.

        Reconciliation of the differences between PRC statutory income tax rate and the Group's effective income tax rate for the six months ended June 30, 2015 and 2016 is as follows:

	For the Six Months Ended June 30,
	2015			2016
	%			%
PRC statutory tax rate		25.0			25.0
Effect of overseas tax-exempt entities		(5.6	)		(6.5	)
Effect of lower tax rate entities		(1.9	)		(0.1	)
Permanent book-tax differences		(5.5	)		(6.5	)
Changes in valuation allowance		(12.0	)		(11.9	)
Effective tax rate		—			—

F-67

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

(c)   Deferred tax assets

        The following table sets forth the significant components of the aggregate deferred tax assets and liabilities:

	As of June 30,
	2015			2016
	RMB			RMB
Deferred tax assets—current
Education expense		—			224
Accrued expenses and others		192			1,094
Total current deferred tax assets		192			1,318
Less: Valuation allowance		(192	)		(1,318	)
Total current deferred tax assets, net		—			—
Deferred tax assets—non-current
Loss carry-forward		32,113			16,964
Total non-current deferred tax assets		32,113			16,964
Less: Valuation allowance		(32,113	)		(16,964	)
Total non-current deferred tax assets, net		—			—

        As of June 30, 2016, the Group had net operating loss carryforwards of approximately RMB8,524 attributable to the Hong Kong subsidiary and of approximately RMB62,376 attributable to the PRC subsidiaries, VIEs and VIEs' subsidiaries. The loss carried forward by the Hong Kong subsidiary can be carried forward to net against future taxable income without a time limit, while the loss carried forward by the PRC companies will expire during the period from Year 2016 to Year 2020.

        A valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the foreseeable future. In making such determination, the Group evaluates a variety of factors including the Group's operating history, accumulated deficit, existence of taxable temporary differences and reversal periods.

        The Group has incurred accumulated net operating losses for income tax purposes since its inception. The Group believes that it is more likely than not that these accumulated net operating losses and other deferred tax assets will not be utilized in the foreseeable future. Accordingly, the Group has provided full valuation allowance for the deferred tax assets as of December 31, 2015 and June 30, 2016.

F-68

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

10. Taxation (continued)

        Changes in valuation allowance are as follows:

	As of June 30,
	2015		2016
	RMB		RMB
Balance at beginning of the six months		19,377		15,063
Provision		12,928		3,219
Balance at end of the six months		32,305		18,282

11. Redeemable Convertible Preferred Shares

        In September 2010, the Group issued 3,125,000 Series A convertible and redeemable preferred shares for aggregate proceeds of RMB35,707 (US$5,250).

        In July 2011, the Group issued 1,302,084 Series A-1 convertible and redeemable preferred shares for aggregate proceeds of RMB24,251 (US$3,750).

        In October 2013, the Group issued 2,962,239 Series B convertible and redeemable preferred shares for aggregate proceeds of RMB107,100 (US$17,500).

        In January and March 2015, the Group issued 4,640,843 Series C convertible and redeemable preferred shares for aggregate proceeds of RMB262,561 (US$42,000).

        The Group has classified the Series A, A-1, B and C preferred shares as mezzanine equity in the consolidated balance sheets as they are contingently redeemable at the option of the holders at any time after September 6, 2017 if a qualified initial public offering has not occurred.

        The Group has determined that conversion and redemption features embedded in the Preferred Shares are not required to be bifurcated and accounted for as derivatives, as the economic characteristics and risks of the embedded conversion and redemption features are clearly and closely related to that of the preferred shares. The preferred shares are not readily convertible into cash as there is not a market mechanism in place for trading of the Company's shares.

        The Group has determined that there was no beneficial conversion feature attributable to any of the preferred shares because the initial effective conversion prices of these preferred shares were higher than the fair value of the Company's ordinary shares at the relevant commitment dates.

        In addition, the carrying values of the preferred shares are accreted from the share issuance dates to the redemption value on the earliest redemption dates. The accretions are recorded against retained earnings, or in the absence of retained earnings, by charges against additional paid-in capital. Once additional paid-in capital has been exhausted, additional charges are recorded by increasing the accumulated deficit.

F-69

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

        As of June 30, 2016, the preferred shares are comprised of the following:

				Shares
Series	Date of Issuance	Issue Price Per Share		Authorized		Issued and Outstanding		Aggregate Liquidation Value		Initial Conversion Ratio		Carrying Amount
		US$										RMB
A	September 6, 2010		1.68		3,125,000		3,125,000		—		1:1		41,919
A-1	July 6, 2011		2.88		1,302,084		1,302,084		—		1:1		29,789
B	October 1, 2013		5.91		2,962,239		2,962,239		—		1:1		134,334
C	January 30, 2015 and March 5, 2015		9.05		4,640,843		4,640,843		—		1:1		293,565

        The rights, preferences and privileges of the preferred shares are as follows:

Redemption Rights

        At any time after September 6, 2017, ("Redemption Start Date"), if a qualified initial public offering has not occurred, holders of more than 50% of the then outstanding Series A, A-1, B and C preferred shares may request redemption of the preferred shares of such series. On receipt of a redemption request from the holders, the Company shall redeem all or part, as requested, of the outstanding preferred shares of such series.

        If any holder of any series of preferred shares exercises its redemption right, any holder of other series of preferred shares shall have the right to exercise the redemption of its series at the same time.

        The redemption price shall be 125% of original issuance price of Series A, Series A-1 and Series B preferred shares, 110% of original issuance price of Series C preferred shares, plus all declared but unpaid dividends up to redemption closing date. The Group shall execute and deliver to each Series A, A-1, B and C preferred shares holders a promissory note for the full amount of the redemption payment due but not paid. That such promissory note shall be due and payable no later than one year anniversary of the closing date of the redemption and shall accrue interest daily at a rate of ten percent per annum.

        The following table sets forth the changes of each of the convertible redeemable preferred shares for the six months ended June 30, 2015 and 2016:

	Series A Preferred Share					Series A-1 Preferred Share					Series B Preferred Share					Series C Preferred Share
	Number of shares		Amount			Number of shares		Amount			Number of shares		Amount			Number of shares		Amount			Total Amount
			RMB					RMB					RMB					RMB			RMB
As of January 1, 2015		3,125,000		37,216			1,302,084		26,273			2,962,239		113,452			—		—			176,941
Gross proceeds from the issuance		—		—			—		—			—		—			4,640,843		262,561			262,561
Issuance cost of Series C		—		—			—		—			—		—			—		(1,061	)		(1,061	)
Accretion		—		626			—		500			—		3,835			—		4,170			9,131
Accumulated other comprehensive income		—		(29	)		—		(20	)		—		(96	)		—		(2,163	)		(2,308	)
As of June 30, 2015		3,125,000		37,813			1,302,084		26,753			2,962,239		117,191			4,640,843		263,507			445,264
As of January 1, 2016		3,125,000		40,181			1,302,084		28,492			2,962,239		126,641			4,640,843		280,704			476,018
Accretion		—		684			—		549			—		4,333			—		5,484			11,050
Accumulated other comprehensive income		—		1,054			—		748			—		3,360			—		7,377			12,539
As of June 30, 2016		3,125,000		41,919			1,302,084		29,789			2,962,239		134,334			4,640,843		293,565			499,607

F-70

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

Conversion Rights

        Each preferred share is convertible, at the option of the holder, at any time after the date of issuance of such preferred shares, according to a conversion ratio, subject to adjustments for dilution, including but not limited to stock splits, stock dividends and capitalization and certain other events. Each preferred share is convertible into a number of ordinary shares determined by dividing the applicable original issuance price by the conversion price. The conversion price of each preferred share is the same as its original issuance price and no adjustments to conversion price have occurred. At June 30, 2016, each preferred share is convertible into one ordinary Class B share.

        Each preferred share shall automatically be converted into ordinary shares, at a conversion ratio of one preferred share to one Class B ordinary share, upon closing of a qualified initial public offering.

        Prior to the Series B preferred shares issuance on October 1, 2013, a "Qualified Initial Public Offering" was defined as an initial public offering with net offering proceeds no less than US$30 million and implied market capitalization of the Company of no less than US$160 million prior to such initial public offering. Upon the issuance of the Series B preferred shares, the net offering proceeds and market capitalization criteria for a "Qualified Initial Public Offering" was increased to US$100 million and US$235 million, respectively. Upon the issuance of the Series C preferred shares, the market capitalization criterial for a "Qualified Initial Public Offering" was increased to US$360 million.

Voting rights

        Each preferred share shall be entitled to that number of votes corresponding to the number of ordinary shares on an as-converted basis. Preferred shares shall vote separately as a class with respect to certain specified matters. Otherwise, the holders of preferred shares and ordinary shares shall vote together as a single class.

Dividend Rights

        Preferred shares holders are entitled to receive dividends if declared by the Board of Directors, in an amount equal to 10% of the original issuance price of the respective series of preferred shares per annum, prior and in preference to any dividend on the ordinary shares. The dividends for Series A, Series A-1, Series B preferred shares shall be accruing and cumulative and non-compounding. The dividends for Series C preferred shares shall be non-cumulative and non-compounding.

        The remaining undistributed earnings of the company after full payment of the above amounts on the preferred shares, shall be distributed on a prorate basis to the holders of ordinary shares and preferred shares on as-if-converted basis.

Liquidation Preferences

        Upon any liquidation event, including deemed liquidation, dissolution or winding up of the Company, the assets of the Company shall be distributed in the following order:

(i)

First, before any distribution or payment to holders of Series A, A-1 and B preferred shares or ordinary shares, each holder of the Series C preferred shares shall be entitled to receive an

F-71

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

11. Redeemable Convertible Preferred Shares (continued)

amount per share equal to 100% of the Series C preferred shares original issuance price, plus all dividends declared but unpaid with respect thereto.

(ii)

Second, following payment in full of the Series C preferred shares amount, but before any distribution or payment to Series A and Series A-1 preferred shares and ordinary shareholders, each holder of the Series B preferred shares shall be entitled to receive an amount per share equal to 125% of the Series B preferred shares original issuance price, plus all dividends accrued but unpaid with respect thereto.



(iii)

Third, following payment in full of the Series C and Series B preferred shares amount, but before any distribution or payment to ordinary shareholders, each holder of the Series A and Series A-1 preferred shares shall be entitled to receive an amount per share equal to 150% of the Series A or Series A-1 preferred shares original issuance price, plus all dividends accrued but unpaid with respect thereto.



(iv)

If there are assets of the Company available for distribution after payment of the above items i), ii), and iii), the remaining assets shall be distributed ratably among the holders of ordinary shares and preferred shares on an as if converted basis.

12. Ordinary Shares

        The Company is authorized to issue a maximum of 50,000,000 shares with a par value of US$0.001 per share, comprised of 37,969,834 ordinary shares and 12,030,166 preferred shares.

        On January 26, 2015, the Company approved the designation of all the issued and outstanding ordinary shares of the Company as Class A ordinary shares or Class B ordinary shares. The holders of Class A ordinary shares shall have two votes in respect of each Class A ordinary share held, the holders of Class B ordinary shares shall have one vote in respect of each Class B ordinary share held, and holder of preferred shares shall be entitled to such number of votes as equals the whole number of Class B ordinary shares on an as-converted basis.

        As of June 30, 2016, the Company was authorized to issue a maximum of 50,000,000 shares with a par value of US$0.001 per share, comprised of 4,543,461 Class A ordinary shares, 33,426,373 Class B ordinary shares and 12,030,166 preferred shares.

F-72

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

13. Share-based Compensation

        A summary of the Group's share option activities for the six months ended June 30, 2015 and 2016 is presented below:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
				US$		(In years)		US$
Outstanding as of January 1, 2015		2,192,161			0.42		7.98		16,471
Granted		253,000			0.42		—		—
Forfeited/expired		(5,000	)		0.42		—		—
Outstanding as of June 30, 2015		2,440,161			0.42		7.72		31,324
Outstanding as of January 1, 2016		2,499,161			0.42		7.28		28,540
Forfeited/expired		(30,500	)		0.42		—		—
Outstanding as of June 30, 2016		2,468,661			0.42		6.77		28,192
Exercisable as of June 30, 2016		1,794,325			0.42		6.23		20,491

        The weighted average grant date fair value of options granted for the six months ended June 30, 2015 was US$8.00 per share and no options granted for the six months ended June 30, 2016.

        Share-based compensation expenses for the share-based awards which are based on service conditions are recognized using the straight-line attribution approach.

        For the six months ended June 30, 2015 and 2016, the Group recognized share-based compensation expenses of RMB3,953 and RMB5,272 respectively, for the stock options granted.

        As of June 30, 2016, there was RMB22,712 of total unrecognized compensation expense, adjusted for estimated forfeitures, related to non-vested share-based compensation arrangement under the 2014 Plan. The expense is expected to be recognized over a weighted average period of 1.01 years. Total unrecognized compensation expense may be adjusted for future changes in estimated forfeitures.

F-73

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

14. Net Loss per Share

        The following table sets forth the basic and diluted net loss per share computation and provides a reconciliation of the numerator and denominator for the periods presented:

	For the Six Months Ended June 30,
	2015			2016
	RMB			RMB
Numerator:
Net loss attributable to Gridsum Holding Inc.		(27,558	)		(29,682	)
Accretion to convertible redeemable preferred share redemption value—A		(626	)		(684	)
Accretion to convertible redeemable preferred share redemption value—A-1		(500	)		(549	)
Accretion to convertible redeemable preferred share redemption value—B		(3,835	)		(4,333	)
Accretion to convertible redeemable preferred share redemption value—C		(4,170	)		(5,484	)
Cumulative dividend to convertible redeemable preferred shareholders—A		(1,632	)		(1,716	)
Cumulative dividend to convertible redeemable preferred shareholders—A-1		(1,166	)		(1,225	)
Cumulative dividend to convertible redeemable preferred shareholders—B		(5,442	)		(5,718	)
Numerator for basic and diluted net loss per share		(44,929	)		(49,391	)
Denominator:
Weighted average number of ordinary shares outstanding, basic and diluted		10,000,000			10,000,000
Net loss per share attributable to Gridsum's ordinary shareholders—Basic and diluted		(4.49	)		(4.94	)

        Basic net loss per share is computed using the weighted average number of the ordinary shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of ordinary shares and dilutive ordinary share equivalents outstanding during the period. For the six months ended June 30, 2015 and 2016, options to purchase ordinary shares that were anti-dilutive and excluded from the calculation of diluted net loss per share was 1,970,490 shares and 2,075,108 shares on a weighted average basis, respectively. For the six months ended June 30, 2015 and 2016, the Series A, Series A-1, Series B and Series C preferred shares of 11,136,482 and 12,030,166, respectively, on a weighted average basis were also antidilutive and excluded from the calculation of diluted net loss per share.

F-74

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

15. Unaudited Pro Forma Balance Sheet and Loss per Share for Conversion of Redeemable Convertible Preferred Shares

        The unaudited pro forma balance sheet information as of June 30, 2016 assumes the automatic conversion of all of the outstanding redeemable convertible preferred shares into Class B ordinary shares on a one-to-one basis, as if the exercise and conversion had occurred as of June 30, 2016.

        Unaudited pro forma basic and diluted net loss per ordinary share reflecting the effect of the conversion of redeemable convertible preferred shares are presented as follows, as if the exercise and conversion had occurred at January 1, 2016:

	For the Six Months Ended June 30,
	2016
	RMB
Numerator:
Net loss attributable to Gridsum's ordinary shareholders		(49,391	)
Preferred share redemption accretion value reversed		11,050
Preferred share cumulative dividend value reversed		8,659
Numerator for pro forma basic and diluted net loss per share		(29,682	)
Denominator:
Weighted average number of ordinary shares outstanding, basic and diluted		10,000,000
Pro forma effect of the conversion of Redeemable Convertible Preferred Shares		12,030,166
Denominator for pro forma basic and diluted net loss per share, basic and diluted		22,030,166
Pro forma net loss per ordinary share, basic and diluted		(1.35	)

16. Related Party Transactions

        The table below sets forth the related parties and their relationship with the Company:

Related party	Relationship with the Company
Guosheng Qi	Chairman and Chief Executive Officer

        Guosheng Qi acted as one of the guarantees for the short-term bank loan borrowed by the Group in 2016 from China Merchants Bank, as disclosed in Note 8.

17. Commitments and Contingencies

(a)   Commitments

        The Group leases its offices and facilities under non-cancellable operating lease agreements. Rental expenses were RMB8,817 and RMB13,090 for the six months ended June 30, 2015 and 2016, respectively.

F-75

GRIDSUM HOLDING INC.

NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (continued)

(In thousands, except for share and per share data)

17. Commitments and Contingencies (continued)

        As of June 30, 2016, future minimum lease under non-cancellable operating lease agreements were as follows:

	Rental commitments
	RMB
2016		7,528
2017		6,424
2018		3,993
2019 and thereafter		963
		18,908

(b)   Litigation

        From time to time, the Company is involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, management does not believe that the ultimate outcome of these unresolved matters, individually and in the aggregate, is reasonably possible to have a material adverse effect on the Company's financial position, results of operations or cash flows. However, litigation is subject to inherent uncertainties and the Company's view of these matters may change in the future. Were an unfavourable outcome to occur, there exists the possibility of a material adverse impact on the Company's financial position, results of operations or cash flows for the period in which the unfavourable outcome occurs and potentially in future periods.

18. Subsequent Events

        The Group has performed an evaluation of subsequent events through August 19, 2016, which is the date that the financial statements were issued, with no other events or transactions needing recognition or disclosure identified.

F-76

Goldman Sachs (Asia) L.L.C.	Citigroup
Stifel

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 6.    INDEMNIFICATION OF DIRECTORS AND OFFICERS.

        Cayman Islands law does not limit the extent to which a company's memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our fifth amended and restated memorandum and articles of association require us to indemnify our officers and directors for losses, damages, costs and expenses incurred in their capacities as such unless such losses or damages arise from dishonesty, willful default, or fraud of such directors or officers.

        Pursuant to the form of indemnification agreements filed as Exhibit 10.3 to this Registration Statement, we agree to indemnify our directors and officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or officer.

        The form of Underwriting Agreement to be filed as Exhibit 1.1 to this Registration Statement will also provide for indemnification of us and our officers and directors.

        Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Securities Act"), may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange Commission (the "SEC") such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

ITEM 7.    RECENT SALES OF UNREGISTERED SECURITIES.

        Since January 1, 2013, we and our predecessor Cayman Islands entity have issued the following securities (including options to acquire our ordinary shares). We believe that each of the following issuances was exempt from registration under the Securities Act in reliance on Regulation D under the Securities Act or pursuant to Section 4(2) of the Securities Act regarding transactions not involving a

II-1

public offering or in reliance on Regulation S under the Securities Act regarding sales by an issuer in offshore transactions.

Purchaser	Date of Issuance		Number of Securities	Consideration in U.S. Dollars		Underwriting Discount and Commission
Quantum Strategic Partners Ltd.		October 1, 2013	1,692,708 Series B preferred shares		10,000,000	Not applicable
Rainbow Castle Holdings Limited		October 1, 2013	677,083 Series B preferred shares		4,000,000	Not applicable
UVM 2 Venture Investments LP		October 1, 2013	507,813 Series B preferred shares		3,000,000	Not applicable
Steamboat Ventures Asia, L.P.		October 1, 2013	84,635 Series B preferred shares		499,998	Not applicable
Broad Street Investments Holding (Singapore) Pte. Ltd.		January 30, 2015	1,657,444 Series C preferred shares		15,000,000	Not applicable
ASEAN China Investment Fund II L.P.		January 30, 2015	773,474 Series C preferred shares		7,000,000	Not applicable
VLTCM Ltd.		January 30, 2015	552,481 Series C preferred shares		5,000,000	Not applicable
Quantum Strategic Partners Ltd.		January 30, 2015	331,489 Series C preferred shares		3,000,000	Not applicable
PA Venture Opportunity VII Limited		January 30, 2015	441,985 Series C preferred shares		4,000,000	Not applicable
Moon Capital Master Fund Ltd.		January 30, 2015	144,529 Series C preferred shares		1,308,000	Not applicable
Moon Capital Partners Master Fund Ltd.		January 30, 2015	186,960 Series C preferred shares		1,692,000	Not applicable
Bridge Street 2015, L.P.		March 5, 2015	258,332 Series C preferred shares		2,337,927	Not applicable
MBD 2015, L.P.		March 5, 2015	66,539 Series C preferred shares		602,184	Not applicable
Stone Street 2015, L.P.		March 5, 2015	75,377 Series C preferred shares		682,168	Not applicable
2015 Employee Offshore Aggregator, L.P.		March 5, 2015	152,233 Series C preferred shares		1,377,722	Not applicable
Certain employees, directors, officers and consultants		Various dates	Options to purchase 1,002,161 Class B ordinary shares		Past and future services to our company	Not applicable

ITEM 8.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a)

Exhibits

        See Exhibit Index beginning on page II-7 of this registration statement.

(b)

Financial Statement Schedules

        Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the registrant's consolidated financial statements or the Notes thereto.

ITEM 9.    UNDERTAKINGS.

        The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreements, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 6, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the

II-2

payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

        The undersigned registrant hereby undertakes that:

(1)

For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant under Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.



(2)

For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-3

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Beijing, China, on August 26, 2016.

Gridsum Holding Inc.
By:	/s/ Guosheng Qi Guosheng Qi Chief Executive Officer and Chairman

II-4

POWER OF ATTORNEY

        Each person whose signature appears below constitutes and appoints Guosheng Qi and Michael Peng Zhang as attorneys-in-fact with full power of substitution, for him or her in any and all capacities, to do any and all acts and all things and to execute any and all instruments which said attorney and agent may deem necessary or desirable to enable the registrant to comply with the Securities Act of 1933, as amended, or Securities Act, and any rules, regulations and requirements of the Securities and Exchange Commission thereunder, in connection with the registration under the Securities Act of ordinary shares of the registrant, or Shares, including, without limitation, the power and authority to sign the name of each of the undersigned in the capacities indicated below to the Registration Statement on Form F-1, or Registration Statement, to be filed with the Securities and Exchange Commission with respect to such Shares, to any and all amendments or supplements to such Registration Statement, whether such amendments or supplements are filed before or after the effective date of such Registration Statement to any related Registration Statement filed pursuant to Rule 462(b) under the Securities Act, and to any and all instruments or documents filed as part of or in connection with such Registration Statement or any and all amendments thereto, whether such amendments are filed before or after the effective date of such Registration Statement; and each of the undersigned hereby ratifies and confirms all that such attorney and agent shall do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Guosheng Qi Guosheng Qi	Chief Executive Officer and Chairman (principal executive officer)	August 26, 2016
/s/ Michael Peng Zhang Michael Peng Zhang	Chief Financial Officer (principal financial and accounting officer)	August 26, 2016
/s/ Guofa Yu Guofa Yu	Director	August 26, 2016
/s/ Perry Lin Chui Perry Lin Chui	Director	August 26, 2016
/s/ Xiang Fan Xiang Fan	Director	August 26, 2016
/s/ Yanchun Bai Yanchun Bai	Director	August 26, 2016
/s/ Xudong Gao Xudong Gao	Director	August 26, 2016
/s/ Thomas Adam Melcher Thomas Adam Melcher	Director	August 26, 2016
/s/ Peter Andrew Schloss Peter Andrew Schloss	Director	August 26, 2016

II-5

SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES

        Pursuant to the Securities Act of 1933, the undersigned, the duly authorized representative in the United States of Gridsum Holding Inc., has signed this registration statement or amendment thereto in New York on August 26, 2016.

Authorized U.S. Representative
By:	/s/ GISELLE MANON Name: Giselle Manon Title: Service of Process Officer Law Debenture Corporate Services Inc.

II-6

GRIDSUM HOLDING INC.
EXHIBIT INDEX

Exhibit Number	Description of Document
1.1*	Form of Underwriting Agreement
3.1	Fourth Amended and Restated Memorandum and Articles of Association of the registrant, as currently in effect
3.2	Shareholders special resolutions passed on August 23, 2016, amending the Fourth Amended and Restated Memorandum and Articles of Association of the registrant
3.3	Form of Fifth Amended and Restated Memorandum and Articles of Association of the registrant, as effective upon the completion of this offering
4.1*	Specimen American Depositary Receipt (included in Exhibit 4.3)
4.2	Specimen Certificate for Class B ordinary shares
4.3*	Form of Deposit Agreement among the registrant, the depositary and all holders and beneficial owners of of the American Depositary Shares issued thereunder
4.4	Second Amended and Restated Shareholders' Agreement dated June 30, 2015, among the registrant, its ordinary shareholders and preferred shareholders
5.1	Form of opinion of Travers Thorp Alberga regarding the validity of the ordinary shares being registered
8.1	Form of opinion of Travers Thorp Alberga regarding certain Cayman Islands tax matters (included in Exhibit 5.1)
8.2	Form of opinion of Fenwick & West LLP regarding certain U.S. tax matters
8.3	Form of opinion of Commerce & Finance Law Offices regarding certain PRC tax matters (included in Exhibit 99.2)
10.1	2014 Stock Option Plan
10.2	2016 Equity Incentive Plan
10.3	Form of Indemnification Agreement between the registrant and members of its board of directors and its executive officers
10.4	Form of Employment Agreement between the registrant and its executive officers
10.5	Exclusive Business Cooperation Agreement dated December 22, 2014 between Dissector (Beijing) Technology Co., Ltd. and Gridsum Holding (Beijing) Co., Ltd.
10.6	Exclusive Option Agreements dated December 22, 2014 among Dissector (Beijing) Technology Co., Ltd., Gridsum Holding (Beijing) Co., Ltd. and the shareholders of Gridsum Holding (Beijing) Co., Ltd.
10.7	Shareholders' Voting Rights Proxy Agreements dated December 22, 2014 among Dissector (Beijing) Technology Co., Ltd., Gridsum Holding (Beijing) Co., Ltd. and the shareholders of Gridsum Holding (Beijing) Co., Ltd.
10.8	Equity Pledge Agreements dated December 22, 2014 among Dissector (Beijing) Technology Co., Ltd., Gridsum Holding (Beijing) Co., Ltd. and the shareholders of Gridsum Holding (Beijing) Co., Ltd.

II-7

Exhibit Number	Description of Document
10.9	English Translation of the Cooperation Agreement, dated March 16, 2012, by and between Beijing Gridsum Technology Co., Ltd. and the State Information Center of China
10.10	English Translation of the Framework Agreement, dated June 25, 2015, by and among Beijing Gridsum Technology Co., Ltd., Guoxinjunhe (Beijing) Technology Co., Ltd. and Beijing Guoxin Xinchuang Investment Co., Ltd.
10.11	English Translation of the Collaboration Agreement, dated June 25, 2015, by and among Beijing Gridsum Technology Co., Ltd., Guoxinjunhe (Beijing) Technology Co., Ltd. and Beijing Guoxin Xinchuang Investment Co., Ltd.
21.1	List of subsidiaries and consolidated affiliated entities of the registrant
23.1	Consent of PricewaterhouseCoopers Zhong Tian LLP, Independent Registered Public Accounting Firm
23.2	Form of consent of Travers Thorp Alberga (included in Exhibit 5.1)
23.3	Form of consent of Fenwick & West LLP (included in Exhibit 8.2)
23.4	Form of consent of Commerce & Finance Law Offices (included in Exhibit 99.2)
24.1	Power of Attorney (included on signature page)
99.1	Code of Business Conduct and Ethics of the registrant
99.2	Form of opinion of Commerce & Finance Law Offices regarding certain PRC law matters
99.3*	Consent of Forrester Consulting

*

To be filed by amendment.

II-8

EX-3.1

Exhibit 3.1

THE COMPANIES LAW

OF THE CAYMAN ISLANDS

COMPANY LIMITED BY SHARES

FOURTH AMENDED AND RESTATED MEMORANDUM OF ASSOCIATION

OF GRIDSUM HOLDING INC.

(Adopted by Special Resolution on June 30, 2015)

1.The name of the Company is Gridsum Holding Inc.

2.The Registered Office of the Company shall be at the offices of Maricorp Services Ltd., P.O. Box 2075, George Town, Grand Cayman KY1-1105, Cayman Islands, or at such other place as the Directors may from time to time decide.

3.The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by the Companies Law or as the same may be revised from time to time, or any other law of the Cayman Islands.

4.The liability of each Member is limited to the amount from time to time unpaid on such Member’s shares.

5.The share capital of the Company is US$50,000.00 divided into 37,969,834 Ordinary Shares of US$0.001 par value each, of which (a) 4,543,461 are designated as Class A Ordinary Shares; and (b) 33,426,373 are designated as Class B Ordinary Share; 3,125,000 Series A Preferred Shares of US$0.001 par value each, 1,302,084 Series A-1 Preferred Shares of US$0.001 par value each, and 2,962,239 Series B Preferred Shares of US$0.001 par value each, 4,640,843 Series C Preferred Shares of US$0.001 par value each, each with power for the Company insofar as is permitted by applicable law and the Articles of Association, to redeem or purchase any of its shares and to increase or reduce the said capital and to issue any part of its capital, whether original, redeemed or increased with or without any preference, priority or special privilege or subject to any postponement of rights or to any conditions or restrictions and so that unless the conditions of issue shall otherwise expressly declare every issue of shares whether declared to be preference or otherwise shall be subject to the powers hereinbefore contained.

6.If the Company is registered as exempted, its operations will be carried on subject to the provisions of Section 174 of the Companies Law and, subject to the provisions of the Companies Law and the Articles of Association, it shall have the power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

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THE COMPANIES LAW

OF THECAYMAN ISLANDS

COMPANY LIMITED BY SHARES

FOURTH AMENDED AND RESTATED ARTICLES OF ASSOCIATION
OF

GRIDSUM HOLDING INC.

(Adopted by Special Resolution on June 30, 2015)

1.In these Articles, Table A in the Schedule to the Statute does not apply and, unless there is something in the subject or context inconsistent therewith:

“Affiliate” means, except with respect to individuals, any other Person that, directly or indirectly, Controls, is Controlled by or is under common Control with such Person, and with respect to an individual, anyone who is a Relative. In the case of GS, the term “Affiliate” includes (a) any direct or indirect shareholder of GS, (b) any of such shareholder’s general partners or limited partners, (c) the fund manager managing such shareholder (and general partners, limited partners and officers thereof), (d) trusts Controlled by or for the benefit of any such individuals referred to in (a), (b) or (c), and (e) any fund or holding company formed for investment purposes that is promoted, sponsored, managed, advised or serviced by The Goldman Sachs Group, Inc. or any of its Affiliates.

“Articles” means these Articles as originally adopted or as from time to time altered by Special Resolution.

“Audit Committee” has the meaning specified in Article 68A.

“Auditors” means the Persons for the time being performing the duties of auditors of the Company.

“Beijing Gridsum” means Beijing Gridsum Technology Co., Ltd. (北京国双科技有限公司), a limited liability company organized and existing under the Laws of the People’s Republic of China.

“Beijing Moment” means Beijing Moment Everlasting Ad Co., Ltd. (北京千里日成广告有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China.

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“Beijing Yunyang” means Beijing Yunyang Ad Co., Ltd. (北京云洋广告有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China.

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

“Business Day” means a day other than Saturday, Sunday, or public holiday in PRC, Hong Kong and the United States of America on which commercial banks are open for business in each such jurisdiction.

“Class A Ordinary Shares” has the meaning specified in Article 6.A(i).

“Class B Ordinary Shares” has the meaning specified in Article 6.A(i).

“Class Conversion Price” has meaning specified in Article 6.A(ii)(4).

“Company” means GRIDSUM HOLDING INC., an exempted company organized and existing under the laws of the Cayman Islands.

“Compensation Committee” has the meaning specified in Article 68A.

“Control” of a given Person means the power or authority, whether exercised or not, to direct the business, management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, which power or authority shall conclusively be presumed to exist upon possession of beneficial ownership or power to direct the vote of more than fifty percent (50%) of the votes entitled to be cast at a meeting of the members or shareholders of such Person or power to control the composition of a majority of the board of directors of such Person; the term “Controlled” has the meaning correlative to the foregoing.

“Control Documents” means the following Contracts dated December 22, 2014 collectively: (a) the Equity Pledge Agreement by and among the WFOE, Gridsum Holdco and Mr. Qi Guosheng, (b) the Equity Pledge Agreement by and among the WFOE, Gridsum Holdco and Mr. Yu Guofa, (c) the Equity Pledge Agreement by and among the WFOE, Gridsum Holdco and Gridsum ( Beijing) Management Consultation Co., Ltd. (国双（北京）管理咨询有限公司) (together with (a) and (b), the “Equity Pledge Agreements”), (d) the Exclusive Option Agreement by and among the WFOE, the Gridsum Holdco and Mr. Qi Guosheng, (e) the Exclusive Option Agreement by and among the WFOE, the Gridsum Holdco and Mr. Yu Guofa, (f) the Exclusive Option Agreement by and among the WFOE, the Gridsum Holdco and Gridsum (Beijing) Management Consultation Co., Ltd. (国双（北京）管理咨询有限公司), (g) the Shareholders’ Voting Rights Proxy Agreement by and among the WFOE, Gridsum Holdco and Mr. Qi Guosheng, (h) the Shareholders’ Voting Rights Proxy Agreement by and among the WFOE, Gridsum Holdco and Mr. Yu Guofa, (i) the Shareholders’ Voting Rights Proxy Agreement by and among the WFOE, Gridsum Holdco and Gridsum (Beijing) Management Consultation Co., Ltd. (国双（北京）管理咨询有限公司), and (j)

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the Exclusive Business Cooperation Agreement by and between Gridsum Holdco and WFOE.

“Debenture” means debenture stock, mortgages, bonds and any other such securities of the Company whether constituting a charge on the assets of the Company or not.

“Deemed Liquidation Event” means, unless waived by the Preferred Shareholder Majority, (i) a merger, consolidation or other business combination of the Company or any other Group Company with or into any other business entity in which the shareholders of the Company or such other Group Company immediately after such merger, consolidation or business combination hold shares representing less than a majority of the voting power of the outstanding share capital of the surviving business entity, or any transaction or series of related transactions to which the Company or any other Group Company is a party in which a majority of the Company’s or such other Group Company’s voting power is transferred, (ii) the sale, lease, transfer or other disposition of all or substantially all of the assets of the Company or any other Group Company in a single transaction or a series of related transactions, or (iii) the exclusive licensing of all or substantially all of the Company’s or any other Group Company’s intellectual property to a third party.

“Director” means a member of the Board.

“Domestic Shareholders” means the Management Shareholders and Gridsum (Beijing) Management Consultation Co., Ltd. (国双（北京）管理咨询有限公司) collectively.

“Equity Securities” means, with respect to a Person, any shares, share capital, registered capital, ownership interest, equity interest, or other securities, and any option, warrant, or right to subscribe for, acquire or purchase any of the foregoing, or any other security or instrument convertible into or exercisable or exchangeable for any of the foregoing, or any equity appreciation, phantom equity, equity plans or similar rights with respect to such Person, and, with respect to the Company, shall include any Ordinary Shares and Ordinary Share Equivalents of the Company.

“ESOP” means the equity incentive plan of the Company duly adopted by the Company pursuant to which 2,500,000 Class B Ordinary Shares (as adjusted for share splits, share dividends, combinations, recapitalizations and similar events) in the aggregate may be issued to employees and consultants of the Group.

“Guoxinjunhe” means Guoxinjunhe (Beijing) Technology Co., Ltd. (国信君和（北京）有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China.

“Gridsum Holdco” means Gridsum Holding (Beijing) Co., Ltd. (国双控股（北京）有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China.

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“Group Company” means each of the Company, the HK Holdco, the WFOE, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe, and Beijing Yunyang, together with each Subsidiary of any of the foregoing, and each Person (other than a natural person) that is, directly or indirectly, Controlled by any of the foregoing, including but not limited to each joint venture in which any of the foregoing holds more than fifty percent (50%) of the voting power, and “Group” refers to all of Group Companies collectively.

“Governmental Authority” means any nation or government or any federation, province or state or any other political subdivision thereof; any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any government authority, agency, department, board, commission or instrumentality of the PRC, the Cayman Islands or any other country, or any political subdivision thereof, any court, tribunal or arbitrator, and any self-regulatory organization.

“Governmental Order” means any applicable order, ruling, decision, verdict, decree, writ, subpoena, mandate, precept, command, directive, consent, approval, award, judgment, injunction or other similar determination or finding by, before or under the supervision of any Governmental Authority.

“GS” means (a) Broad Street Investments Holding (Singapore) Pte. Ltd., a limited liability company incorporated under the laws of the Republic of Singapore, whose registered address is at 1 Raffles Link, #07-01, Singapore 39393, (b) any Affiliate of (a) that holds Share(s) in the Company at any time, and (c) any of their Permitted Transferees.

“HK Holdco” means Gridsum Holding (China) Limited (國雙控股（中國）有限公司), a company organized and existing under the laws of Hong Kong.

“Law” or “Laws” means any constitutional provision, statute or other law, rule, regulation, official policy or interpretation of any Governmental Authority and any Governmental Order.

“Management Holdcos Majority” has the meaning ascribed to it in the Shareholders’ Agreement.

“Management Shareholders” means Mr. Qi Guosheng (祁国晟) and Mr. Yu Guofa (于国法).

“Member” has the meaning ascribed to it in the Statute.

“Memorandum” means the fourth amended and restated memorandum of association of the Company adopted by the Company pursuant to the Statute, as from time to time altered by Special Resolution.

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“New Ordinary Securities” means (i) in the case of New Securities that are Ordinary Shares, such New Securities and (ii) in the case of New Securities that are Ordinary Share Equivalents, the Ordinary Shares that are deemed issued pursuant to Article 6.A(ii)(4)(e)(v)(E)).

“New Securities” means, subject to the terms of Article 6.A(ii)(4)(e)(v) hereof, any Equity Securities of the Company, except for (i) any Ordinary Shares, or any option or warrant to acquire any Ordinary Shares, issued to employees, officers, consultants or directors of the Company pursuant to the ESOP; (ii) Equity Securities of the Company issued upon conversion of the Preferred Shares; (iii) Equity Securities of the Company issued in connection with a bona fide acquisition of another business approved by the Preferred Shareholder Majority; (iv) Equity Securities of the Company issued in a Qualified IPO; or (v) Equity Securities of the Company issued in connection with any share split, share dividend, combination, or similar transaction of the Company.

“Non- Issuing Parties” or “Non-Issuing Party” has the meaning specified in Article 9(v).

“Ordinary Directors” has the meaning specified in Article 73.

“Ordinary Resolution” means subject to Article 6.A, a resolution passed at a general meeting of the Company by a simple majority of the votes cast or a unanimous written resolutions of those Members entitled to vote.

“Ordinary Shares” has the meaning specified in Article 6.A(i).

“Ordinary Share Equivalents” means warrants, options and rights exercisable for Ordinary Shares or securities convertible into or exchangeable for Ordinary Shares, including, without limitation, the Preferred Shares.

“Original Issue Price” means the Original Series A Issue Price with respect to the Series A Preferred Shares, the Original Series A-1 Issue Price with respect to the Series A-1 Preferred Shares, the Original Series B Issue Price with respect to the Series B Preferred Shares, or Original Series C Issue Price with respect to the Series C Preferred Shares, as the case may be.

“Original Series A Issue Date” means September 6, 2010.

“Original Series A Issue Price” means US$1.68, as appropriately adjusted for share splits, share dividends, combinations, recapitalizations and similar events with respect to Series A Preferred Shares.

“Original Series A-1 Issue Date” means July 8, 2011.

“Original Series A-1 Issue Price” means US$2.88, as appropriately adjusted for share splits, share dividends, combinations, recapitalizations and similar events with respect to Series A-1 Preferred Shares.

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“Original Series B Issue Date” means October 1, 2013.

“Original Series B Issue Price” means US$ 5.91, as appropriately adjusted for share splits, share dividends, combinations, recapitalizations and similar events with respect to Series B Preferred Shares.

“Original Series C Issue Date” means the date on which the first Series C Preferred Share was issued.

“Original Series C Issue Price” means US$ 9.05, as appropriately adjusted for share splits, share dividends, combinations, recapitalizations and similar events with respect to Series C Preferred Shares.

“Paid-up” means paid-up and/or credited as paid-up.

“Permitted Transferee” means, with respect to any Preferred Shareholder, an entity Controls, Controlled by, or under common Control with any Preferred Shareholder; provided, that such Preferred Shareholder that is a corporation may freely transfer any of its Equity Securities to any shareholder of such Preferred Shareholder; and any Preferred Shareholder which is a limited or general partnership may freely transfer any of its Equity Securities to its partners and to affiliated partnerships managed by the same management company or managing (general) partner or by an entity which controls, is controlled by, or is under common control with, such management company or managing (general) partner.  In the case of the Preferred Shareholders, a Permitted Transferee includes any of their respective Affiliates.

“Person” means any individual, corporation, partnership, limited partnership, proprietorship, association, limited liability company, firm, trust, estate or other enterprise or entity.

“PRC” means the People’s Republic of China, but solely for the purposes of these Articles, excluding the Hong Kong Special Administrative Region, the Macau Special Administrative Region and the islands of Taiwan.

“Preferred Shareholders” means the holders of Preferred Shares.

“Preferred Shareholder Directors” means, collectively, the Series A Director, the Series B Director and the Series C Director (each a “Preferred Shareholder Director”), who currently serve on the Board, excluding, for the avoidance of doubt, any such Person who has vacated his/her office in accordance with Article 72 or 73.

“Preferred Shareholder Majority” means one or more Preferred Shareholders who hold more than a majority in voting power of the then outstanding Preferred Shares (on an as-converted basis).

“Preferred Series A-1 Majority” means one or more Preferred Shareholders who hold more than a majority in voting power of the then outstanding Series A-1 Preferred Shares.

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“Preferred Series B Majority” means one or more Preferred Shareholders who hold more than a majority in voting power of the then outstanding Series B Preferred Shares.

“Preferred Series C Majority” means one or more Preferred Shareholders who hold a majority in voting power of the then outstanding Series C Preferred Shares.

“Preferred Shares” has the meaning specified in Article 6.A(i).

“Qualified IPO” means the closing of the first firm commitment fully underwritten public offering of Ordinary Shares of the Company with gross proceeds to the Company of at least US$100 million and reflecting a pre-money market valuation of the Company (based on the price per share offered to the public in the offering) of at least US$360 million, and the listing of such Ordinary Shares on the New York Stock Exchange, the Nasdaq Global Market System, the Main Board of the Hong Kong Stock Exchange, Shanghai Stock Exchange, Shenzhen Stock Exchange or any other reputable international exchange or quotation system that is approved in writing by the Preferred Shareholder Majority.

“Redemption Date” has the meaning specified in Article 9(vi).

“Redemption Notice” has the meaning specified in Article 9(v).

“Redemption Notification” has the meaning specified in Article 9(vi).

“Redemption Price” has the meaning specified in Article 9(v).

“Redemption Trigger Date” has the meaning specified in Article 9(ii).

“Registered Office” means the registered office for the time being of the Company.

“Related Party” means an officer, director or Affiliate of any Group Company or any “affiliate” or “associate” (as those terms are defined in Rule 405 promulgated under the Securities Act) of any of them or any Relative of any of them.

“Relative” means a husband, wife, father, mother, son, daughter, brother, sister, grandparent, grandchild, or spouse of any of these, or a person living in the same household with an individual.

“Required Consenters” has the meaning specified in Article 27.

“Seal” means the common seal of the Company and includes every duplicate seal.

“Secretary” includes an Assistant Secretary and any person appointed to perform the duties of Secretary of the Company.

“Securities Act” means the United States Securities Exchange Act of 1934, as amended.

“Series A Conversion Price” has meaning specified in Article 6.A(ii)(4).

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“Series A Director” has the meaning specified in Article 73.

“Series A Preference Amount” has the meaning specified in Article 6.A(ii)(2)(c).

“Series A Preferred Shares” has the meaning specified in Article 6.A(i).

“Series A Redemption Notice” has the meaning specified in Article 9(ii).

“Series A Redemption Price” has the meaning specified in Article 9(ii).

“Series A Redemption Trigger Date” has the meaning specified in Article 9(ii).

“Series A-1 Conversion Price” has meaning specified in Article 6.A(ii)(4).

“Series A-1 Preference Amount” has the meaning specified in Article 6.A(ii)(2)(c).

“Series A-1 Preferred Shares” has the meaning specified in Article 6.A(i).

“Series A-1 Redemption Notice” has the meaning specified in Article 9(iii).

“Series A-1 Redemption Price” has the meaning specified in Article 9(iii).

“Series A-1 Redemption Trigger Date” has the meaning specified in Article 9(iii).

“Series B Conversion Price” has meaning specified in Article 6.A(ii)(4).

“Series B Director” has meaning specified in Article 73.

“Series B Preference Amount” has the meaning specified in Article 6.A(ii)(2)(b).

“Series B Preferred Shares” has the meaning specified in Article 6.A(i).

“Series B Redemption Notice” has the meaning specified in Article 9(iv).

“Series B Redemption Price” has the meaning specified in Article 9(iv).

“Series B Redemption Trigger Date” has the meaning specified in Article 9(iv).

“Series C Conversion Price” has meaning specified in Article 6.A(ii)(4).

“Series C Director” has meaning specified in Article 73.

“Series C Preference Amount” has the meaning specified in Article 6.A(ii)(2)(a).

“Series C Preferred Shares” has the meaning specified in Article 6.A(i).

“Series C Redemption Notice” has the meaning specified in Article 9(v).

“Series C Redemption Price” has the meaning specified in Article 9(v).

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“Series C Redemption Trigger Date” has the meaning specified in Article 9(v).

“Shareholders’ Agreement” means that certain Second Amended and Restated Shareholders’ Agreement by and among the Group Companies, certain shareholders of the Company, and certain other parties, as amended from time to time.

“Shares” has the meaning specified in Article 6.A and may also be referenced as “share” and includes any fraction of a share.

“Special Resolution” has the same meaning as in the Statute and includes a unanimous resolution approved in writing as described therein.

“Statute” means the Companies Law (2013 Revision) of the Cayman Islands and every statutory modification or re-enactment thereof for the time being in force.

“Subsidiary” means, with respect to any specified Person, any other Person Controlled by the specified Person, directly or indirectly, whether through contractual arrangements or through ownership of equity securities, voting power or registered capital. For the avoidance of the doubt, a “variable interest entity” Controlled by another entity shall be deemed a Subsidiary of that other entity, and shall include, without limitation, for the Company, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe and Beijing Yunyang.

“Tax” means (i) in the PRC: (a) any national, provincial, municipal, or local taxes, charges, fees, levies, or other assessments, including, without limitation, all net income (including enterprise income tax and individual income withholding tax), turnover (including value-added tax, business tax, and consumption tax), resource (including urban and township land use tax), special purpose (including land value-added tax, urban maintenance and construction tax, and additional education fees), property (including urban real estate tax and land use fees), documentation (including stamp duty and deed tax), filing, recording, social insurance (including pension, medical, unemployment, housing, and other social insurance withholding), tariffs (including import duty and import value-added tax), and estimated and provisional taxes, charges, fees, levies, or other assessments of any kind whatsoever, (b) all interest, penalties (administrative, civil or criminal), or additional amounts imposed by any Government Authority in connection with any item described in clause (a) above, and (c) any form of transferee liability imposed by any Government Authority in connection with any item described in clauses (a) and (b) above, and (ii) in any jurisdiction other than the PRC: all similar liabilities as described in clause (i) above.

“Transaction Documents” has the meaning set forth in the Shareholders’ Agreement.

“Transfer” has the meaning set forth in the Shareholders’ Agreement.

“U.S. dollars” or “US$” means United States dollars, the lawful currency for the time being of the United States of America.

“Waiting Period” has the meaning specified in Article 9(vi).

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“WFOE” means Dissector (Beijing) Technology Co. Ltd. (迪塞克特（北京）科技有限公司), a company organized and existing under the Laws of the People’s Republic of China.

“written” and “in writing” include all modes of representing or reproducing words in visible form.

Words importing the singular number also include the plural number and vice-versa.

Words importing the masculine gender also include the feminine gender and vice-versa.

The term “day” means “calendar day”.

2.The business of the Company may be commenced as soon after incorporation as the Directors shall see fit, notwithstanding that only part of the shares may have been allotted.

3.The original Directors may pay, out of the capital or any other monies of the Company, all expenses incurred in or about the formation and establishment of the Company including the expenses of registration.

CERTIFICATES FOR SHARES

4.The Company shall maintain a register of its Members.  A Member shall only be entitled to a share certificate if the Directors resolve that share certificates shall be issued. Certificates representing shares of the Company shall be in such form as shall be determined by the Directors.  Such certificates may be under Seal.  Share certificates shall be signed by one or more Directors or other persons authorized by the Directors. The Directors may authorize certificates to be issued with the Seal and authorized signature(s) affixed by mechanical process.  The Company shall not be bound to issue more than one certificate for shares held jointly by more than one person and delivery of a certificate to one joint holder shall be a sufficient delivery to all of them. All certificates for shares shall be consecutively numbered or otherwise identified and shall specify the shares to which they relate.  The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered in the register of Members of the Company.  All certificates surrendered to the Company for transfer shall be canceled and no new certificate shall be issued until the former certificate for a like number of shares shall have been surrendered and canceled.

5.Notwithstanding Article 4 of these Articles, if a share certificate is defaced, lost, stolen, or destroyed, it may be renewed on payment of a fee of one dollar (US$1.00) or such lesser sum and on such terms (if any) as the Directors may reasonably prescribe to indemnify the Company from any loss incurred by it in connection with such certificate, including the payment of the expenses incurred by the Company in investigating evidence, as the Directors may prescribe.

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ISSUE OF SHARES

6.Subject to the provisions, if any, in that behalf in the Memorandum and in these Articles (including but not limited to Article 6.A and any agreements including without limitation the Transaction Documents binding on the Company) and to any direction that may be given by the Company in a general meeting and without prejudice to any special rights previously conferred on the holders of existing shares including Section 5 of the Shareholders’ Agreement (which is incorporated by reference herein), the Directors may allot, issue, grant options over or otherwise dispose of shares of the Company (including fractions of a share) with or without preferred, deferred or other special rights or restrictions, whether in regard to dividend, voting, return of capital or otherwise and to such persons, at such times and on such other terms as they think proper.  The Company shall not issue shares in bearer form.

6.A(i)CLASSES, NUMBER AND PAR VALUE OF THE SHARES

At the date of the adoption of these Articles the authorized share capital of the Company is US$ 50,000.00 divided into 37,969,834 Ordinary Shares of US$0.001 par value each, of which (a) 4,543,461 are designated as Class A Ordinary Shares of US$0.001 par value each (the “Class A Ordinary Shares”); and (b) 33,426,373 are designated as Class B Ordinary Share of US$0.001 par value each (the “Class B Ordinary Shares”, together with Class A Ordinary Shares, the “Ordinary Shares”); 3,125,000 Series A Preferred Shares of US$0.001 par value each (the “Series A Preferred Shares”), 1,302,084 Series A-1 Preferred Shares of US$0.001 par value each (the “Series A-1 Preferred Shares”), 2,962,239 Series B Preferred Shares of US$0.001 par value each (the “Series B Preferred Shares”), 4,640,843 Series C Preferred Shares of US$0.001 par value each (the “Series C Preferred Shares”, together with the Series A Preferred Shares, the Series A-1 Preferred Shares and the Series B Preferred Shares, the “Preferred Shares”).  The Ordinary Shares and the Preferred Shares are collectively referred to herein as the “Shares”.

(ii)DESIGNATIONS, POWERS, PREFERENCES, ETC. OF SHARES

(1)Dividends.

(a)Each holder of Preferred Shares shall be entitled to receive, for each Series A Preferred Share held by such holder, dividends at the rate of ten percent (10%) of the Original Series A Issue Price per annum, for each Series A-1 Preferred Share held by such holder, dividends at the rate of ten percent (10%) of the Original Series A-1 Issue Price per annum, for each Series B Preferred Share held by such holder, dividends at the rate of ten percent (10%) of the Original Series B Issue Price per annum, and for each Series C Preferred Share held by such holder, dividends at the rate of ten percent (10%) of the Original Series C Issue Price per annum, payable out of funds or assets when and as such funds or assets become legally available therefor on parity with each other (and, in the case of Series C Preferred Shares, when and if

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such dividends are declared by the Board), prior and in preference to any dividend on the Ordinary Shares (except for a dividend payable solely in Ordinary Shares).With respect to each Series C Preferred Share, the dividends thereon shall be non-cumulative and non-compounding; with respect to each of Series A Preferred Share, Series A-1 Preferred Share and Series B Preferred Share, the dividends thereon shall be accruing and cumulative and non-compounding.  Any accrued (or, in the case of Series C Preferred Shares, declared) but unpaid dividend prior to the applicable Redemption Trigger Date, any liquidation, dissolution or winding up of the Company or any Deemed Liquidation Event (as applicable), shall be paid upon the earliest to occur of any of the foregoing events.

Dividends, other than the dividends mentioned in Article 6.A(ii)(1)(a),  shall be payable solely in Ordinary Shares.

(b)Subject to the provisions of the Statute and these Articles (including but not limited to the other requirements of this Article 6.A), no dividends (other than dividends payable solely in Ordinary Shares) shall be declared or paid on the Ordinary Shares unless and until (i) all accrued (or, in the case of Series C Preferred Shares, declared) but unpaid dividends on the Preferred Shares set forth in clause (a) above have been paid in full, and (ii) a dividend in like amount is paid at the same time on each outstanding Preferred Share such that the dividend declared or paid to the holder thereof shall be equal to the dividend that such holder would have received pursuant to this clause (b) if such Preferred Share had been converted into Ordinary Shares immediately prior to the record date for such dividend, or if no such record date is established, the date such dividend is made, and if such share then participated in and the holder thereof received such dividend.

(c)All dividend payments made to the holders of Preferred Shares shall be paid in U.S. dollars.

(2)Liquidation Preferences. Upon any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, or any Deemed Liquidation Event, any distribution or payment shall be made in the following manner:

(a)first, before any distribution or payment shall be made to other Equity Securities holders, each holder of the Series C Preferred Shares shall be entitled to receive an amount per Series C Preferred Share then held by such holder (the “Series C Preference Amount”) equal to one hundred percent (100%) of

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the Original Series C Issue Price, plus all dividends declared but unpaid with respect thereto.  If the assets and funds of the Company shall be insufficient to permit the payment of the full amount of the Series C Preference Amount, then the entire assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of the Series C Preferred Shares;

(b)second, following payment in full of the Series C Preference Amount, but before any distribution or payment shall be made to other Equity Securities holders, each holder of Series B Preferred Shares shall be entitled to receive an amount per Series B Preferred Share then held by such holder (the “Series B Preference Amount”) equal to one hundred and twenty-five percent (125%) of the Original Series B Issue Price, plus all dividends accrued but unpaid with respect thereto.  Following payment in full of the Series C Preference Amount, if the assets and funds of the Company shall be insufficient to permit the payment of the full amount of the Series B Preference Amount, then the entire remaining assets and funds of the Company legally available for distribution to that particular class shall be distributed ratably among the holders of the Series B Preferred Shares;

(c)third, following payment in full of the Series C Preference Amount and the Series B Preference Amount, but before any distribution or payment shall be made to other Equity Securities holders, (i) each holder of Series A Preferred Shares shall be entitled to receive an amount per Series A Preferred Share then held by such holder (the “Series A Preference Amount”) equal to one hundred and fifty percent (150%) of the Original Series A Issue Price, plus all dividends accrued but unpaid with respect thereto; (ii) each holder of Series A-1 Preferred Shares shall be entitled to receive an amount per Series A-1 Preferred Share then held by such holder (the “Series A-1 Preference Amount”) equal to one hundred and fifty percent (150%) of the Original Series A-1 Issue Price, plus all dividends accrued but unpaid with respect thereto. Following payment in full of the Series C Preference Amount and the Series B Preference Amount, if the assets and funds of the Company shall be insufficient to permit the payment of the full amount of the Series A Preference Amount and Series A-1 Preference Amount, then the entire remaining assets and funds of the Company legally available for distribution to the Series A Preferred Shares and Series A-1 Preferred Shares shall be distributed ratably among the holders of the Series A Preferred Shares and Series A-1 Preferred Shares.

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(d)lastly, following payment in full of the Series C Preference Amount, the Series B Preference Amount, the Series A-1 Preference Amount and the Series A Preference Amount,  the remaining assets of the Company available for distribution to Members shall be distributed ratably among the holders of the outstanding Preferred Shares (as if such Preferred Shares had been converted to Ordinary Shares immediately prior to such liquidation, dissolution or winding up of the Company or Deemed Liquidation Event pursuant to clause (4) below) and the outstanding Ordinary Shares.

(3)Voting Rights.

Subject to the provisions of these Articles, at all general meetings of the Company: (i) the holder of each Class A Ordinary Share issued and outstanding shall have two (2) votes in respect of each Class A Ordinary Share held, (ii) the holder of each Class B Ordinary Share issued and outstanding shall have one (1) vote in respect of each Class B Ordinary Share held, and (iii) the holder of each Preferred Share shall be entitled to such number of votes, in respect of such Preferred Share, as equals the number of Class B Ordinary Shares into which such Preferred Share is convertible immediately after the close of business on the record date of the determination of the Company’s shareholders entitled to vote or, if no such record date is established, at the date such vote is taken or any written consent of the Company’s shareholders is first solicited. Subject to provisions to the contrary elsewhere in these Articles, or as required by the Statute, the holders of Preferred Shares shall vote together with the holders of Ordinary Shares, and not as a separate class or series, on all matters put before the Members, provided that holders of Series A Preferred Shares, holders of Series B Preferred Shares and holders of Series C Preferred Shares shall vote as a separate class respectively with respect to the election of Series A Director, Series B Director and Series C Director.

(4)Conversion.

Each Class A Ordinary Share is convertible into one (1) Class B Ordinary Share at any time by the holder thereof. The right to convert shall be exercisable by the holder of the Class A Ordinary Share delivering a written notice to the Company that such holder elects to convert a specified number of Class A Ordinary Shares into Class B Ordinary Share.

Any conversion of Class A Ordinary Shares into Class B Ordinary Shares pursuant to these Articles shall be effected by means of redeeming or repurchasing the Class A Ordinary Shares and applying the proceeds thereof towards payment for the issuance of Class B Ordinary Shares on a one for one basis. Such conversion shall become effective forthwith upon entries being made in the Register of Members to record the re-

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designation of the relevant Class A Ordinary Shares as Class B Ordinary Shares.

In no event shall Class B Ordinary Shares and Preferred Shares be convertible into Class A Ordinary Shares.

Save and except for voting rights and conversion rights as set out above, the Class A Ordinary Shares and the Class B Ordinary Shares shall rank pari passu and shall have the same rights, preferences, privileges and restrictions.

The holders of the Preferred Shares shall have the following rights described below with respect to the conversion of the Preferred Shares into Ordinary Shares (for the purpose of this Article 6.A(ii)(4), “Ordinary Shares” which may be converted from Preferred Shares means Class B Ordinary Shares).  Subject to the provisions of this Article 6.A(ii)(4), the number of Ordinary Shares to which a holder shall be entitled upon conversion of any Preferred Share shall be the quotient of the applicable Original Issue Price divided by the then-effective applicable Class Conversion Price.  For the avoidance of doubt, subject to the provisions of this Article 6.A(ii)(4), the “Series A Conversion Price” initially shall be the Original Series A Issue Price and shall be subject to adjustment from time to time as provided herein (regardless whether such Series A Preferred Shares have been actually issued), the “Series A-1 Conversion Price” initially shall be the Original Series A-1 Issue Price and shall be subject to adjustment from time to time as provided herein (regardless whether such Series A-1 Preferred Shares have been actually issued), the “Series B Conversion Price” initially shall be the Original Series B Issue Price and shall be subject to adjustment from time to time as provided herein (regardless whether such Series B Preferred Shares have been actually issued), and the “Series C Conversion Price” initially shall be the Original Series C Issue Price and shall be subject to adjustment from time to time as provided herein (regardless whether such Series C Preferred Shares have been actually issued). The “Class Conversion Price” shall mean the Series A Conversion Price with respect to the Series A Preferred Shares, the Series A-1 Conversion Price with respect to the Series A-1 Preferred Shares, the Series B Conversion Price with respect to the Series B Preferred Shares, or the Series C Conversion Price with respect to the Series C Preferred Shares, as the case may be.

(a)Optional Conversion.

(i)Subject to and in compliance with the provisions of this Article 6.A(ii)(4)(a) and subject to complying with the requirements of the Statute, Preferred Shares may, at the option of the holder thereof, be converted in whole or in part at any time into fully-paid and nonassessable Ordinary

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Shares based on the then-effective applicable Class Conversion Price.

(ii)The holder of Preferred Shares who desires to convert such shares into Ordinary Shares shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or any transfer agent for the Preferred Shares, and shall give written notice to the Company at such office that such holder has elected to convert such shares.  Such notice shall state the number of Preferred Shares being converted.  Thereupon, the Company shall promptly issue and deliver to such holder at such office a certificate or certificates for the number of Ordinary Shares to which the holder is entitled and update its register of members. No fractional Ordinary Shares shall be issued upon conversion of the Preferred Shares, and the number of Ordinary Shares to be so issued to a holder of Preferred Shares upon the conversion of such Preferred Shares (after aggregating all fractional Ordinary Shares that would be issued to such holder) shall be rounded to the nearest whole share (with one-half being rounded upward).  Such conversion shall be deemed to have been made at the close of business on the date of the surrender of the certificates representing the Preferred Shares to be converted, and the person entitled to receive the Ordinary Shares issuable upon such conversion shall be treated for all purposes as the record holder of such Ordinary Shares on such date.

(b)Automatic Conversion.

(i)Without any action being required by the Preferred Shareholders and whether or not the certificates representing such share are surrendered to the Company or its transfer agent, each Preferred Share shall automatically be converted into an Ordinary Share upon the closing of a Qualified IPO, based on the then-effective applicable Class Conversion Price.

(ii)The Company shall not be obligated to issue certificates for any Ordinary Shares issuable upon the automatic conversion of Preferred Shares unless the certificate or certificates evidencing such Preferred Shares is either delivered as provided below to the Company or any transfer agent for the Preferred Shares, or the holder notifies the Company or its transfer agent that such certificate has been lost, stolen or destroyed and executes an agreement satisfactory to the Company to indemnify the

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Company from any loss incurred by it in connection with such certificate.  The Company shall, as soon as practicable after receipt of certificates for Preferred Shares, or satisfactory agreement for indemnification in the case of a lost certificate, promptly issue and deliver at its office to the holder thereof a certificate or certificates for the number of Ordinary Shares to which the holder is entitled and update its register of members. No fractional Ordinary Shares shall be issued upon conversion of the Preferred Shares, and the number of Ordinary Shares to be so issued to a holder of converting Preferred Shares (after aggregating all fractional Ordinary Shares that would be issued to such holder) shall be rounded to the nearest whole share (with one-half being rounded upward).  Any person entitled to receive Ordinary Shares issuable upon the automatic conversion of the Preferred Shares shall be treated for all purposes as the record holder of such Ordinary Shares on the date of such conversion.

(c)The Directors may effect such conversion in any manner available under applicable law, including redeeming or repurchasing the Preferred Shares and applying the proceeds thereof towards payment for the new Ordinary Shares.

(d)For purposes of the repurchase or redemption, the Directors may, subject to the Company being able to pay its debts in the ordinary course of business, make payments out of its capital.

(e)Adjustments to Conversion Price.

(i)Adjustment for Share Splits and Combinations.  If the Company shall at any time, or from time to time, effect a subdivision of the outstanding Ordinary Shares, each Class Conversion Price in effect immediately prior to such subdivision shall be proportionately decreased.  Conversely, if the Company shall at any time, or from time to time, combine the outstanding Ordinary Shares into a smaller number of shares, each Class Conversion Price in effect immediately prior to the combination shall be proportionately increased.  Any adjustment under this paragraph shall become effective at the close of business on the date the subdivision or combination becomes effective.

(ii)Adjustment for Ordinary Share Dividends and Distributions.  If the Company makes (or fixes a record date for the determination of holders of Ordinary Shares entitled to receive) a dividend or other distribution solely to

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the holders of Ordinary Shares payable in Ordinary Shares, each Class Conversion Price then in effect shall be decreased as of the time of such issuance (or in the event such record date is fixed, as of the close of business on such record date) by multiplying such Class Conversion Price then in effect by a fraction (i) the numerator of which is the total number of Ordinary Shares issued and outstanding immediately prior to the time of such issuance or the close of business on such record date, and (ii) the denominator of which is the total number of Ordinary Shares issued and outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of Ordinary Shares issuable in payment of such dividend or distribution.

(iii)Adjustments for Other Dividends.  If the Company at any time, or from time to time, makes (or fixes a record date for the determination of holders of Ordinary Shares entitled to receive) a dividend or other distribution payable in securities of the Company other than Ordinary Shares, then, and in each such event, provision shall be made so that, upon conversion of any Preferred Share thereafter, the holder thereof shall receive, in addition to the number of Ordinary Shares issuable thereon, the amount of securities of the Company which the holder of such share would have received had the Preferred Shares been converted into Ordinary Shares immediately prior to such event, all subject to further adjustment as provided herein.

(iv)Reorganizations, Mergers, Consolidations, Reclassifications, Exchanges, Substitutions.  If at any time, or from time to time, any capital reorganization or reclassification of the Ordinary Shares (other than as a result of a share dividend, subdivision, split or combination otherwise treated above) occurs or the Company is consolidated, merged or amalgamated with or into another Person (other than a consolidation, merger or amalgamation treated as a Deemed Liquidation Event), then in any such event, provision shall be made so that, upon conversion of any Preferred Share thereafter, the holder thereof shall receive the kind and amount of shares and other securities and property which the holder of such share would have received had the Preferred Shares been converted into Ordinary Shares on the date of such event, all subject to further adjustment as provided herein, or with respect to such other securities or property, in accordance with any terms applicable thereto.

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(v)Issuance of New Securities.

(A)Weighted Average Anti-dilution Adjustment on Series A Preferred Shares. If, after the Original Series A Issue Date, the Company shall issue New Ordinary Securities without consideration or for a consideration per Ordinary Share less than the Series A Conversion Price in effect on the date of and immediately prior to such issuance, then and in such event, the Series A Conversion Price shall be reduced concurrently with such issuance, to a price (calculated to the nearest cent) determined in accordance with the following formula:

CP2 =CP1 * (A+B) / (A+C).

For purpose of the foregoing formula, the following definitions shall apply:

i) “CP2” shall mean the Series A Conversion Price in effect immediately after such issuance of New Securities;

ii) “CP1” shall mean the Series A Conversion Price in effect immediately prior to such issuance of New Securities;

iii) “A” shall mean the number of outstanding Ordinary Shares (assuming conversion of all outstanding Preferred Shares) immediately prior to such issuance of New Securities;

iv) “B” shall mean the number of Ordinary Shares that would have been issued if such New Ordinary Securities had been issued at a price per share equal to CP1; and

v) “C” shall mean the number of such New Ordinary Securities issued in such transaction.

(B)Weighted Average Anti-dilution Adjustment on Series A-1 Preferred Shares after the Original Series A-1 Issue Date. If, after the Original Series A-1 Issue Date, the Company shall issue New Ordinary Securities without consideration or for a consideration per Ordinary Share less than the Series A-1 Conversion Price in effect on the date of and immediately prior to such issuance, then and in

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such event, the Series A-1 Conversion Price shall be reduced concurrently with such issuance, to a price (calculated to the nearest cent) determined in accordance with the following formula:

CP2 =CP1 * (A+B) / (A+C).

For purpose of the foregoing formula, the following definitions shall apply:

i) “CP2” shall mean the Series A-1 Conversion Price in effect immediately after such issuance of New Securities;

ii) “CP1” shall mean the Series A-1 Conversion Price in effect immediately prior to such issuance of New Securities;

iii) “A” shall mean the number of outstanding Ordinary Shares (assuming conversion of all outstanding Preferred Shares) immediately prior to such issuance of New Securities;

iv) “B” shall mean the number of Ordinary Shares that would have been issued if such New Ordinary Securities had been issued at a price per share equal to CP1; and

v) “C” shall mean the number of such New Ordinary Securities issued in such transaction.

(C)Weighted Average Anti-dilution Adjustment on Series B Preferred Shares after the Original Series B Issue Date. If, after the Original Series B Issue Date, the Company shall issue New Ordinary Securities without consideration or for a consideration per Ordinary Share less than the Series B Conversion Price in effect on the date of and immediately prior to such issuance, then and in such event, the Series B Conversion Price shall be reduced concurrently with such issuance, to a price (calculated to the nearest cent) determined in accordance with the following formula:

CP2 =CP1 * (A+B) / (A+C).

For purpose of the foregoing formula, the following definitions shall apply:

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i) “CP2” shall mean the Series B Conversion Price in effect immediately after such issuance of New Securities;

ii) “CP1” shall mean the Series B Conversion Price in effect immediately prior to such issuance of New Securities;

iii) “A” shall mean the number of outstanding Ordinary Shares (assuming conversion of all outstanding Preferred Shares) immediately prior to such issuance of New Securities;

iv) “B” shall mean the number of Ordinary Shares that would have been issued if such New Ordinary Securities had been issued at a price per share equal to CP1; and

v) “C” shall mean the number of such New Ordinary Securities issued in such transaction.

(D)Weighted Average Anti-dilution Adjustment on Series C Preferred Shares after the Original Series C Issue Date. If, after the Original Series C Issue Date, the Company shall issue New Ordinary Securities without consideration or for a consideration per Ordinary Share less than the Series C Conversion Price in effect on the date of and immediately prior to such issuance, then and in such event, the Series C Conversion Price shall be reduced concurrently with such issuance, to a price (calculated to the nearest cent) determined in accordance with the following formula:

CP2 =CP1 * (A+B) / (A+C).

For purpose of the foregoing formula, the following definitions shall apply:

i) “CP2” shall mean the Series C Conversion Price in effect immediately after such issuance of New Securities;

ii) “CP1” shall mean the Series C Conversion Price in effect immediately prior to such issuance of New Securities;

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iii) “A” shall mean the number of outstanding Ordinary Shares (assuming conversion of all outstanding Preferred Shares) immediately prior to such issuance of New Securities;

iv) “B” shall mean the number of Ordinary Shares that would have been issued if such New Ordinary Securities had been issued at a price per share equal to CP1; and

v) “C” shall mean the number of such New Ordinary Securities issued in such transaction.

(E)Determination of Consideration.  For the purpose of making any adjustment to any Class Conversion Price or the number of Ordinary Shares issuable upon conversion of Preferred Shares, as provided above:

i)To the extent it consists of cash, the consideration received by the Company for any issue or sale of securities shall be computed at the net amount of cash received by the Company after deduction of any underwriting or similar commissions, compensations, discounts or concessions paid or allowed by the Company in connection with such issue or sale;

ii)To the extent it consists of property other than cash, consideration other than cash received by the Company for any issue or sale of securities shall be computed at the fair market value thereof (as determined in good faith by a majority of the Board, which majority must include each of the Preferred Shareholder Directors), as of the date of the adoption of the resolution specifically authorizing such issue or sale, irrespective of any accounting treatment of such property; and

iii)If New Securities or Ordinary Share Equivalents exercisable, convertible or exchangeable for New Securities are issued or sold together with other stock or securities or other assets of the Company for consideration which covers both, the consideration received for the New Securities or such Ordinary Share Equivalents shall be computed as that portion of the consideration

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received (as determined in good faith by a majority of the Board, which majority must include each of the Preferred Shareholder Directors) to be allocable to such New Securities or Ordinary Share Equivalents.

iv)The consideration per Ordinary Share received by the Company for New Securities deemed to have been issued pursuant to clause (F) below relating to Ordinary Share Equivalents shall equal the quotient obtained by dividing (x) the total amount, if any, received or receivable by the Company as consideration for the issue of such Ordinary Share Equivalents (determined in the manner described in clauses (i) - (iii) above), plus the minimum aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration) payable to the Company upon the exercise, conversion or exchange of such Ordinary Share Equivalents for Ordinary Shares by (y) the maximum number of Ordinary Shares issuable upon the exercise, conversion or exchange of such Ordinary Share Equivalents.

(F)Deemed Issuances; No Exercise.  If the Company at any time or from time to time shall issue any Ordinary Share Equivalents or shall fix a record date for the determination of holders of any series or class of securities entitled to receive any such Ordinary Share Equivalents, then the maximum number of Ordinary Shares issuable upon the exercise, conversion and exchange of such Ordinary Share Equivalents shall be deemed to be New Securities issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date. No further adjustment shall be made upon such exercise, conversion and exchange to the extent already made pursuant hereto. If all of the rights to exercise, convert or exchange any Ordinary Share Equivalents shall expire without any of such rights having been exercised, the applicable Class Conversion Price as adjusted upon the issuance of such Ordinary Share Equivalents, shall be readjusted to the applicable Class Conversion Price

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which would have been in effect had such Ordinary Share Equivalents never been issued.

(vi)Other Dilutive Events.  In case any event shall occur as to which the other provisions of this Article 6.A(ii)(4) are not strictly applicable, but the failure to make any adjustment to any Class Conversion Price would not fairly protect the conversion rights of the applicable Preferred Shares in accordance with the essential intent and principles hereof, then, in each such case, the Company, in good faith, shall determine the appropriate adjustment to be made, on a basis consistent with the essential intent and principles established in this Article 6.A(ii)(4), necessary to preserve, without dilution, the conversion rights of such series of Preferred Shares.

(vii)Certificate of Adjustment.  In the case of any adjustment or readjustment of any Class Conversion Price, the Company, at its sole expense, shall compute such adjustment or readjustment in accordance with the provisions hereof and prepare a certificate showing such adjustment or readjustment, and shall mail such certificate, by first class mail, postage prepaid, to each registered holder of the applicable Preferred Shares at such holder’s address as shown in the Company’s books.  The certificate shall set forth such adjustment or readjustment, showing in detail the facts upon which such adjustment or readjustment is based, including a statement of (i) the consideration received or deemed to be received by the Company for any New Securities issued or sold or deemed to have been issued or sold, (ii) the number of New Securities issued or sold or deemed to be issued or sold, (iii) the applicable Class Conversion Price in effect before and after such adjustment or readjustment, and (iv) the number of Ordinary Shares and the type and amount, if any, of other property which would be received upon conversion of the applicable Preferred Shares after such adjustment or readjustment.

(viii)Notice of Record Date.  In the event the Company shall propose to take any action of the type or types requiring an adjustment to any Class Conversion Price or the number or character of the applicable Preferred Shares as set forth herein, the Company shall give notice to the holders of the applicable Preferred Shares, which notice shall specify the record date, if any, with respect to any such action and the date on which such action is to take place.  Such notice

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shall also set forth such facts with respect thereto as shall be reasonably necessary to indicate the effect of such action (to the extent such effect may be known at the date of such notice) on the applicable Class Conversion Price and the number, kind or class of shares or other securities or property which shall be deliverable upon the occurrence of such action or deliverable upon the conversion of the applicable Preferred Shares.  In the case of any action which would require the fixing of a record date, such notice shall be given at least twenty (20) days prior to the date so fixed, and in the case of all other actions, such notice shall be given at least thirty (30) days prior to the taking of such proposed action.

(ix)Reservation of Shares Issuable Upon Conversion.  The Company shall at all times reserve and keep available out of its authorized but unissued Ordinary Shares, solely for the purpose of effecting the conversion of the  Preferred Shares, such number of its Ordinary Shares as shall from time to time be sufficient to effect the conversion of all outstanding Preferred Shares.  If at any time the number of authorized but unissued Ordinary Shares shall not be sufficient to effect the conversion of all then outstanding Preferred Shares, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued Ordinary Shares to such number of shares as shall be sufficient for such purpose.

(x)Notices.  Any notice required or permitted pursuant to this Article 6.A(ii)(4) shall be given in writing and shall be given either personally or by sending it by next-day or second-day courier service, fax, electronic mail or similar means to each holder of record at the address of such holder appearing on the books of the Company.  Where a notice is sent by next-day or second-day courier service, service of the notice shall be deemed to be effected by properly addressing, pre-paying and sending by next-day or second-day service through an internationally-recognized courier a letter containing the notice, with a confirmation of delivery, and to have been effected at the expiration of two (2) days after the letter containing the same is sent as aforesaid. Where a notice is sent by fax or electronic mail, service of the notice shall be deemed to be effected by properly addressing, and sending such notice through a transmitting organization, with a written confirmation of

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delivery, and to have been effected on the day the same is sent as aforesaid.

(xi)Payment of Taxes.  The Company will pay all Cayman Islands taxes, if any, (other than taxes based upon income) and other Cayman Islands governmental charges that may be imposed with respect to the issue or delivery of Ordinary Shares upon conversion of Preferred Shares, excluding any tax or other charge imposed in connection with any transfer involved in the issue and delivery of Ordinary Shares in a name other than that in which the Preferred Share so converted were registered.

(5)Preferred Share Protective Provisions.

(a)Acts of the Company.  In addition to any other rights provided by law, for so long as any Preferred Share remains outstanding, any action by any Group Company (whether by amendment of these Articles, through any merger, amalgamation, combination or similar transaction or otherwise, whether directly or indirectly, and whether in a single transaction or a series of related transactions) that effects or approves any of the following transactions shall require an affirmative vote of the Preferred Shareholder Majority in writing, voting as a single class:

(i)amend, alter, or repeal any provisions of the Charter Documents of any Group Company (including the Memorandum and Articles) or any Control Document;

(ii)create, authorize or issue (including by reclassification or otherwise) any Equity Securities of any Group Company (other than pursuant to the ESOP);

(iii)alter, reorganize or otherwise recapitalize the Equity Securities of any Group Company, including, without limitation, any increase, reduction or cancellation of the Equity Securities of any Group Company or any consolidation, subdivision or conversion of, or any alteration of the rights in respect of, any Equity Securities of any Group Company;

(iv)effect any sale, liquidation, dissolution, winding up, or merger of any Group Company, or transfer of all or substantially all of its assets, or any other transaction in which Control of any Group Company is transferred;

(v)repurchase or redeem any Equity Securities of any Group Company, except for redemption or repurchase of shares at

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cost upon termination of services of an employee, consultant, or independent contractor or pursuant to the Company’s exercise of its rights of first refusal;

(vi)change the size or composition of the board of directors of any Group Company;

(vii)declare or pay any dividend or other distribution on any Equity Securities of any Group Company;

(viii)issue debt or guarantee, together with any other then outstanding debt owed by the Group Companies,  in excess of US$1,000,000;

(ix)approve or amend any stock option plan or other employee incentive plan or increase the number of shares reserved for issuance to employees, directors or contractors;

(x)change the principal business of any Group Company, enter a new line of business or exit the current line of business;

(xi)appoint any of the following the positions of any Group Company: Chairman, Chief Executive Officer, Chief Financial Officer, Chief Technology Officer, President, Managing Director, any other Vice President level or above position, Controller, or HR Director;

(xii)appoint or remove the Company’s auditor or make any material change in the accounting or financial policies of the Company;

(xiii)appoint or remove directors of Group Companies (other than the Company);

(xiv)approve the annual budget and business plans and any material deviations therefrom;

(xv)allocation of any Equity Securities of the Company to employees and consultants of the Group under the ESOP;

(xvi)enter into any transaction with any Related Party or Affiliate of any Group Company, or amend any existing agreement with such Person;

(xvii)sell, transfer, change, pledge or encumber the equity interests in any of the Group Company (other than the Company);

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(xviii)sell, transfer, license, pledge or encumber any technology or intellectual property of any of the Group Companies, other than licenses granted in the ordinary course of business;

(xix)acquire a business or enter into a joint venture with a transaction value in excess of US$1,000,000;

(xx)incur any items of expenditure outside the duly approved annual budget in excess of US$500,000 per month, individually or in the aggregate; or

(xxi)provide any increase in compensation of any employee of any Group Company with monthly salary of at least RMB40,000 by more than fifteen percent (15%) in a twelve (12) month period.

(b)Where any act listed in paragraphs (i) to (xxi) above requires a Special Resolution in accordance with the Statute, and if the Members vote in favor of such act but the approval of the Preferred Shareholder Majority has not been obtained, then each holder of a Preferred Share who votes against the resolution at a meeting of the Members shall be deemed to have ten (10) times the number of votes of its actual Shares.

(6)Series A Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Series A Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Series A Preferred Shares, voting as a separate class :

(a)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares;

(b)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) any the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A-1 Preferred Shares, the Series B Preferred Shares, or the Series C Preferred Shares which will or is reasonably expected to have an adverse impact on the rights and

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entitlements (economic or otherwise) of the Series A Preferred Shareholders.

(7)Series A-1 Preferred Shares Protective Provisions. For so long as any Series A-1 Preferred Share remains outstanding, the Company shall not and shall cause each other Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise), without an affirmative vote in writing of the holders of a majority of the then outstanding Series A-1 Preferred Shares, voting as a separate class:

(a)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A-1 Preferred Shares; or

(b)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) any the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares, the Series B Preferred Shares, or the Series C Preferred Shares which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series A-1 Preferred Shareholders.

(8)Series B Preferred Shares Protective Provisions. For so long as any Series B Preferred Share remains outstanding, the Company shall not and shall cause each other Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise), without an affirmative vote in writing of the Preferred Series B Majority, voting as a separate class:

(a)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series B Preferred Shares; or

(b)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) any the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares the Series A-1 Preferred Shares, or the Series C Preferred Shares which will or is reasonably expected to have an adverse impact on the rights and

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entitlements (economic or otherwise) of the Series B Preferred Shareholders.

(9)Series C Preferred Shares Protective Provisions. For so long as any Series C Preferred Share remains outstanding, the Company shall not and shall cause each other Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise), without an affirmative vote in writing of the Preferred Series C Majority, voting as a separate class:

(a)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series C Preferred Shares;

(b)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) any the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares, the Series A-1 Preferred Shares or the Series B Preferred Shares, which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series C Preferred Shareholders.

(10)Class A Ordinary Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Class A Ordinary Share remains outstanding, the Company shall not and shall cause each other Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Class A Ordinary Shares, voting as a separate class:

(a)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Class A Ordinary Shares;

(b)create, authorize or issue (including by reclassification or otherwise) any Class A Ordinary Share of any Group Company.

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TRANSFER OF SHARES

7.Subject to any agreements including without limitation the Transaction Documents binding on the Company and its Members (including Section 6 of the Shareholders’ Agreement which is incorporated by reference herein), shares are transferable, and the Company will only register transfers of shares that are made in accordance with such agreements (if any) and will not register transfers of shares that are not made in accordance with such agreements (if any). The instrument of transfer of any share shall be in writing and shall be executed by or on behalf of the transferor, and the transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the register in respect thereof.

REDEMPTION AND PURCHASE OF SHARES

8.(i)Subject to the provisions of the Statute and these Articles, shares may be issued on the terms that they are, or at the option of the Company or the holder are, to be redeemed on such terms and in such manner as the Company, before the issue of the shares, may by special resolution determine.

(ii)Subject to the provisions of the Statute and these Articles, the Company may purchase its own shares (including fractions of a share), including any redeemable shares, provided that the manner of purchase has first been authorized by the Company in general meeting and may make payment therefore in any manner authorized by the Statute, including out of capital.

9.Notwithstanding any provisions to the contrary in Article 8, the Preferred Shares shall not be redeemable except:

(i)Notwithstanding any other provisions to the contrary herein, none of any Shares shall be redeemable before such Shares have been paid up in full.

(ii)Optional Redemption of Series A Preferred Shares. At any time prior to a Qualified IPO and after the seventh (7th) anniversary of the Original Series A Issue Date or such earlier date any other class or series of Equity Securities of the Company are required to be redeemed by the Company (the “Series A Redemption Trigger Date”), the Company shall, at the written request of the holders representing a majority in voting power of all outstanding Series A Preferred Shares (the “Series A Redemption Notice”), redeem all or part of the Series A Preferred Shares on the Redemption Date in accordance with Article 9(vi).  The redemption price (the “Series A Redemption Price”) for each Series A Preferred Share redeemed pursuant to this Article 9(ii) shall be the sum of (i) one hundred and twenty-five percent (125%) of the Original Series A Issue Price and (ii) any accrued but unpaid dividends on such Preferred Share.

(iii)Optional Redemption of Series A-1 Preferred Shares. At any time prior to a Qualified IPO and after the seventh (7th) anniversary of the Original Series A-1 Issue Date or such earlier date any other class or series of Equity Securities of the Company  are required to be redeemed by the Company (the “Series A-1 Redemption Trigger Date”), the Company shall, at the written request of the

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Preferred Series A-1 Majority (the “Series A-1 Redemption Notice”), redeem all or part of the Series A-1 Preferred Share on the Redemption Date in accordance with Article 9(vi).  The redemption price (the “Series A-1 Redemption Price”) for each Series A-1 Preferred Share redeemed pursuant to this Article 9(iii) shall be the sum of (i) one hundred and twenty-five percent (125%) of the Original Series A-1 Issue Price and (ii) any accrued but unpaid dividends on such Preferred Share.

(iv)Optional Redemption of Series B Preferred Shares. At any time prior to a Qualified IPO and after the seventh (7th) anniversary of the Original Series B Issue Date or such earlier date any other class or series of Equity Securities of the Company are required to be redeemed by the Company (the “Series B Redemption Trigger Date”), the Company shall, at the written request of the any holder of Series B Preferred Shares (the “Series B Redemption Notice”), redeem all or part of the Series B Preferred Shares on the Redemption Date in accordance with Article 9(vi).  The redemption price (the “Series B Redemption Price”) for each Series B Preferred Share redeemed pursuant to this Article 9(iv) shall be the sum of (i) one hundred and twenty-five percent (125%) of the Original Series B Issue Price and (ii) any accrued but unpaid dividends on such Preferred Share.

(v)Optional Redemption of Series C Preferred Shares. (a) At any time prior to a Qualified IPO and after the sixth (6th) anniversary of the Original Series C Issue Date, (b) such earlier date any other class or series of Equity Securities of the Company are required to be redeemed by the Company (in each case of (a) and (b), the “Series C Redemption Trigger Date”, together with the Series A Redemption Trigger Date, the Series A-1 Redemption Trigger Date and the Series B Redemption Trigger Date, each, a “Redemption Trigger Date”), any Series C Preferred Shareholder may (at its sole discretion) require the Company to redeem all or part of the Series C Preferred Shares held by such Series C Preferred Shareholder on the Redemption Date in accordance with Article 9(vi) by delivering to the Company a written request (the “Series C Redemption Notice” together with the Series A Redemption Notice, the Series A-1 Redemption Notice and the Series B Redemption Notice, each a “Redemption Notice”).  The redemption price (the “Series C Redemption Price” and with the Series A Redemption Price, the Series A-1 Redemption Price and the Series B Redemption Price, each, a “Redemption Price”) for each Series C Preferred Share redeemed pursuant to this Article 9(v) shall be the sum of (i) one hundred and ten percent (110%) of the Original Series C Issue Price and (ii) any declared but unpaid dividends on such Preferred Share.

(vi)Procedures.  Following receipt of any Redemption Notice, the Company shall on the same date of receipt of such Redemption Notice send a notice of such Redemption Notice (the “Redemption Notification”) to each holder of record of a Preferred Share (collectively, the “Non-Issuing Parties” and each a “Non-Issuing Party”), at the address last shown on the records of the Company for such holder(s).  The Redemption Notification shall indicate that the holders of a series or class of Preferred Shares have elected redemption of all or a part of the

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Preferred Shares of such series or class held thereby pursuant to the provisions of Article 9(ii), Article 9(iii), Article 9(iv) or Article 9(v) and shall specify the applicable Redemption Price, the number of Preferred Shares of such series or class to be redeemed and each Non-Issuing Party may elect by notice to the Company pursuant to these Articles to exercise its right to require the Company to redeem all or part of its Preferred Shares within seven days following receipt of the Redemption Notification from the Company (the “Waiting Period”). Any Redemption Notice received by the Company beyond the Waiting Period shall be deemed overdue and expired in respect of the current redemption.  The closing of Redemption will take place within twenty (20) days after the date of expiration of the Waiting Period at the offices of the Company (such date, the “Redemption Date”).  For the avoidance of doubt, the Redemption Date for all applicable Preferred Shares should take place on the same date.  On the Redemption Date, subject to applicable law, the Company will, from any source of assets or funds legally available therefore, redeem the Preferred Shares to be redeemed on the Redemption Date by paying such applicable Redemption Price against surrender by such holder at the Company’s principal office of the certificate representing such Preferred Shares.  On the Redemption Date, if the Company pays the applicable Redemption Price to a holder of a Preferred Share, all rights of the holder of such Preferred Share (except the right to receive the Redemption Price therefor) will cease with respect to such Preferred Share, and such Preferred Share will not thereafter be transferred on the books of the Company or be deemed outstanding for any purpose whatsoever.

(vii)Insufficient Funds.  If the Company is legally in a position to redeem on the date that any redemption payment under this Article 9 is due but has insufficient assets or funds to pay in full all redemption payments to be paid on the Redemption Date, (i) all the assets or funds of the Company available shall be used to the extent permitted by applicable law to pay all redemption payments due on such date ratably in proportion to the full amounts to which the holders to which such redemption payments are due would otherwise be respectively entitled thereon, and, for the avoidance of doubt, there shall be no priority of payment among any series of Preferred Shares and each class or series of Preferred Shares shall be paid on such proportionate basis, and (ii) the Company shall execute and deliver to each holder a promissory note for the full amount of the redemption payment due but not paid to such holder pursuant to clause (i) above and, if a promissory note is issued, shall cancel the relevant Preferred Shares; provided, that such promissory note shall be due and payable no later than the one (1) year anniversary of the Redemption Date, and the full amount due under such promissory note shall accrue interest daily (on the basis of a 365-day year) at a rate of ten percent (10%) per annum.

(viii)Other Limited Redemption.  If the Company is otherwise prohibited by applicable law from redeeming all Preferred Shares to be redeemed on the Redemption Date pursuant to Article 9(vi), those assets or funds which are legally available shall be used to the extent permitted by applicable law to pay all redemption payments due on such date ratably in proportion to the full amounts to which the holders to

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which such redemption payments are due would otherwise be respectively entitled thereon.  Thereafter, all assets or funds of the Company that become legally available for the redemption of shares shall immediately be used to pay first, the promissory notes issued pursuant to Article 9(vii) ratably and on a pari passu basis, and second, the redemption payment which the Company did not pay on the date that such redemption payments were due.  If the Company fails to redeem any Preferred Share on its due date for redemption, as from such date until the date on which the Preferred Share is redeemed, the Company shall not declare to pay any dividend or make any distribution to holders of Ordinary Shares.

(ix)Unpaid Shares.  Without limiting any rights of the holders of Preferred Shares which are set forth in these Articles, or are otherwise available under law, the balance of any Preferred Shares that are subject to redemption pursuant to the terms hereof but are not so redeemed because the Company is prohibited by applicable law from redeeming such Preferred Shares or otherwise, such Preferred Shares shall continue to have all the powers, designations, preferences and relative participating, optional, and other special rights (including, without limitation, rights to accrue dividends) which such Preferred Shares had prior to such date, until the applicable Redemption Price has been paid in full with respect to such Preferred Shares.

VARIATION OF RIGHTS OF SHARES

10.Subject to Article 6.A, if at any time the share capital of the Company is divided into different classes or series of shares, the rights attached to any class or series (unless otherwise provided by the terms of issue of the shares of that class or series) may not, whether or not the Company is being wound-up, be varied without the consent in writing of the holders of at least a majority of the issued shares of that class or series, or without the sanction of a special resolution passed at a general meeting of the holders of the shares of that class or series.

The provisions of these Articles relating to general meetings shall apply to every such general meeting of the holders of one class of shares except that the necessary quorum shall be one (1) person holding or representing by proxy at least one-third of the issued shares of the class and that any holder of shares of the class present in person or by proxy may demand a poll.

11.Subject to Article 6.A, the rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking pari passu or senior therewith.

COMMISSION ON SALE OF SHARES

12.Subject to the provisions of the Statute and these Articles (including but not limited to Article 6.A), the Company may (i) pay a commission to any person in consideration of his subscribing or agreeing to subscribe whether absolutely or conditionally for any

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shares of the Company, which commissions may be satisfied by the payment of cash or the lodgment of fully or partly Paid-up shares or partly in one way and partly in the other and (ii) pay, on any issue of shares, such brokerage fees as may be lawful.

NON-RECOGNITION OF TRUSTS

13.No person shall be recognized by the Company as holding any share upon any trust, and the Company shall not be bound by or be compelled in any way to recognize (even when having notice thereof), any equitable, contingent, future, or partial interest in any share, or any interest in any fractional part of a share, or (except only as is otherwise provided by these Articles or the Statute) any other rights in respect of any share except an absolute right to the entirety thereof in the registered holder.

REGISTRATION OF EMPOWERING INSTRUMENTS

14.The Company shall be entitled to charge a fee not exceeding one dollar (US$1.00) on the registration of every probate, letters of administration, certificate of death or marriage, power of attorney, or other instrument.

TRANSMISSION OF SHARES

15.In case of the death of a Member, the survivor or survivors where the deceased was a joint holder, and the legal personal representatives of the deceased where he was a sole holder, shall be the only persons recognized by the Company as having any title to his interest in the shares, but nothing herein contained shall release the estate of any such deceased holder from any liability in respect of any shares which had been held by him solely or jointly with other persons.

16.Any person becoming entitled to a share in consequence of the death or bankruptcy or liquidation or dissolution of a Member (or in any other way than by transfer) may, upon such evidence being produced as may from time to time be required by the Directors and, subject as hereinafter provided, elect either to be registered himself as holder of the share or to make such transfer of the share to such other person nominated by him as the deceased or bankrupt person could have made and to have such person registered as the transferee thereof, but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the share by that Member before his death or bankruptcy as the case may be. If the person so becoming entitled shall elect to be registered himself as holder, such person shall deliver or send to the Company a notice in writing signed by such person so stating such election.

17.A person becoming entitled to a share by reason of the death or bankruptcy or liquidation or dissolution of the holder (or in any other case than by voluntary transfer) shall be entitled to the same dividends and other advantages to which he would be entitled if he were the registered holder of the share, except that he shall not, before being registered as a Member in respect of the share, be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company; provided that the Directors may at any time give notice requiring any such person to elect either to be registered himself or to transfer the share and if the notice is not complied with within

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ninety days the Directors may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the share until the requirements of the notice have been complied with.

AMENDMENT OF MEMORANDUM OF ASSOCIATION, ALTERATION OF
CAPITAL & CHANGE OF LOCATION OF REGISTERED OFFICE

18.(i)Subject to the provisions of the Statute and these Articles (including but not limited to Article 6.A), the Company may from time to time alter or amend its Memorandum with respect to any objects, powers or other matters specified therein to:

Aby Ordinary Resolution increase the share capital by such sum to be divided into shares of such amount or without nominal or par value as the resolution shall prescribe and with such rights, priorities and privileges annexed thereto, as the Company in general meeting may determine;

Bby Ordinary Resolution consolidate and divide all or any of its share capital into shares of larger amount than its existing shares;

Cby Ordinary Resolution divide or subdivide all or any of its share capital into shares of smaller amount than is fixed by the Memorandum or into shares without nominal or par value;

Dby Ordinary Resolution cancel any shares which at the date of the passing of the resolution have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled.

(ii)All new shares created hereunder shall be subject to the same provisions with reference to transfer, transmission, and otherwise as the shares in the original share capital.

(iii)Subject to the provisions of the Statute and these Articles (including but not limited to Article 6.A), the Company may by Special Resolution reduce its share capital and any capital redemption reserve fund.

(iv)Subject to the provisions of the Statute and these Articles (including but not limited to Article 6.A), the Company may by resolution of the Directors change the location of its Registered Office.

FIXING RECORD DATE

19.The Directors may fix in advance a date as the record date for any determination of Members entitled to notice of or to attend or vote at a meeting of the Members. For the purpose of determining the Members entitled to receive payment of any dividend, the Directors may, at or within ninety (90) days prior to the date of declaration of such dividend, fix a subsequent date as the record date for such determination.

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20.If no record date is fixed for the determination of Members entitled to notice of or to attend or vote at a meeting of Members or Members entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of Members.  When a determination of Members entitled to attend or receive notice of, attend or vote at any meeting of Members has been made as provided in this Article, such determination shall apply to any adjournment thereof.

GENERAL MEETING

21.All general meetings other than annual general meetings shall be called extraordinary general meetings.

22.The Company may hold a general meeting as its annual general meeting but shall not (unless required by Statute) be obliged to hold an annual general meeting. The annual general meeting, if held, shall be held at such time and place as the Directors shall appoint and if no other time and place is prescribed by them, it shall be held at the principal executive offices of the Company on the second Wednesday in December of each year at ten o’clock in the morning. At these meetings the report of the Directors (if any) shall be presented.

23.The Directors may call general meetings, and they shall, on the requisition of Members of the Company holding at the date of deposit of the requisition not less than twenty percent (20%) of the paid up capital of the Company as at the date of the deposit carries the right of voting at general meetings of the Company, forthwith proceed to convene an extraordinary general meeting of the Company.

24.The requisition must state the objects of the meeting and must be signed by the requisitionists and deposited at the Registered Office of the Company and may consist of several documents in like form each signed by one or more requisitionists.

25.If the Directors do not within twenty-one (21) days from the date of the deposit of the requisition duly proceed to convene a general meeting, the requisitionists, or any of them representing not less than a majority of the aggregate voting rights of all of them,  may themselves convene a general meeting, but any meeting so convened shall be subject to other Articles hereof, including Article 28, and shall not be held after the expiration of three (3) months after the expiration of the said twenty-one (21) days.

26.A general meeting convened as aforesaid by requisitionists shall be convened in the same manner as nearly as possible as that in which general meetings are to be convened by Directors.

NOTICE OF GENERAL MEETINGS

27.At least ten (10) days’ notice shall be given of an annual general meeting and at least twenty (20) days’ notice shall be given of any other general meeting unless such notice is waived either before, at or after such annual or other general meeting (i) in the case of a

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general meeting called as an annual general meeting, by all the Members entitled to attend and vote thereat or their proxies; and (ii) in the case of any other general meeting, by holders of not less than the appropriate proportion of all those Shares which are in issue at the time which would be required to approve the actions submitted to the Members for approval at such meeting, or their proxies (collectively, the “Required Consenters”).  Every notice shall be exclusive of the day on which it is given or deemed to be given and shall specify the place, the day and the hour of the meeting and the general nature of the business and shall be given in the manner hereinafter mentioned; provided that any general meeting of the Company shall, whether or not the notice specified in this regulation has been given and whether or not the provisions of Articles 23-26 have been complied with, be deemed to have been duly convened if it is so agreed by the Required Consenters.

PROCEEDINGS AT GENERAL MEETINGS

28.No business shall be transacted at any general meeting unless a quorum of Members is present at the time when the meeting proceeds to business. The holders of at least fifty percent (50%) of the aggregate voting power of all outstanding Ordinary Shares and at least fifty percent (50%) of the aggregate voting power of all outstanding Preferred Shares (on an as-converted basis) entitled to notice of and to attend and vote at such general meeting present in person or by proxy or if a company or other non-natural person by its duly authorized representative shall be a quorum.

29.A person shall be deemed to be present at a general meeting if he participates by telephone or other electronic means and all persons participating in the meeting are able to hear each other.

30.An action that may be taken by the members at a meeting may also be taken by a resolution of members consented to, unanimously, in writing or by telex, telegram, cable, facsimile or other written electronic communication. The consent may be in the form of counterparts, each counterpart being signed by one or more members.

31.If within thirty (30) minutes from the time appointed for the meeting a quorum is not present, the meeting shall be dissolved.

32.The chairman of the Board shall be the then chief executive officer of the Company.  The chairman of the Board shall preside as chairman at every general meeting of the Company, or if there is no such chairman, or if he shall not be present within thirty (30) minutes after the time appointed for the holding of the meeting, or is unwilling to act, the members present shall elect one (1) of their number to be chairman of the meeting.

33.The chairman may, with the consent of any general meeting duly constituted hereunder at which a quorum is present (and shall if so directed by the meeting), adjourn the meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.  When a general meeting is adjourned for thirty (30) days or

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more, notice of the adjourned meeting shall be given as in the case of an original meeting.  Otherwise it shall not be necessary to give any such notice.

34.At any general meeting, a resolution put to the vote of the meeting shall be decided by the vote of the requisite majority pursuant to a poll of the Members. Unless otherwise required by Statute or these Articles, such requisite majority shall be a simple majority of votes cast.

VOTES OF MEMBERS

35.Except as otherwise required by law or these Articles, every Member of record present or, if such Member is a corporation or other non-natural person, such Member is present by its duly authorized representative, shall have one (1) vote for each share registered in his name in the register of Members.

36.In the case of joint holders of record, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the register of Members.

37.A Member of unsound mind, or in respect of whom an order has been made by any court, having jurisdiction in lunacy, may vote by his committee, receiver, curator bonis, or other person in the nature of a committee, receiver or curator bonis appointed by that court, and any such committee, receiver, curator bonis, or other person may vote by proxy.

38.No Member shall be entitled to vote at any general meeting unless he is registered as a Member of the Company on the record date for such meeting nor unless all calls or other sums presently payable by him in respect of shares in the Company have been paid.

39.No objection shall be raised to the qualification of any voter except at the general meeting or adjourned general meeting at which the vote objected to is given or tendered and every vote not disallowed at such general meeting shall be valid for all purposes.  Any such objection made in due time shall be referred to the determination of the chairman of the general meeting to be exercised in his or her reasonable discretion.

40.Votes may be given either personally or by proxy.

PROXIES

41.The instrument appointing a proxy shall be in writing and shall be executed under the hand of the appointor or of his attorney duly authorized in writing, or, if the appointor is a corporation under the hand of an officer or attorney duly authorized in that behalf.  A proxy need not be a Member of the Company.

42.The instrument appointing a proxy shall be deposited at the Registered Office of the Company or at such other place as is specified for that purpose in the notice convening the meeting no later than the time for holding the meeting, or adjourned meeting.

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43.The instrument appointing a proxy may be in any usual or common form and may be expressed to be for a particular meeting or any adjournment thereof or generally until revoked.

44.A vote given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous death or insanity of the principal or revocation of the proxy or of the authority under which the proxy was executed, or the transfer of the share in respect of which the proxy is given provided that no intimation in writing of such death, insanity, revocation or transfer as aforesaid shall have been received by the Company at the Registered Office before the commencement of the general meeting, or adjourned meeting at which it is sought to use the proxy.

CORPORATE MEMBERS

45.Any corporation which is a Member of record of the Company may in accordance with its articles or other governing documents, or in the absence of such provision by resolution of its directors or other governing body, authorize such person as it thinks fit to act as its representative at any meeting of the Company or of any class of Members of the Company, and the person so authorized shall be entitled to exercise the same powers on behalf of the corporation which he represents as the corporation could exercise if it were an individual Member of record of the Company.

SHARES THAT MAY NOT BE VOTED

46.Shares of its own capital held by the Company in a fiduciary capacity shall not be voted, directly or indirectly, at any meeting and shall not be counted in determining the total number of outstanding shares at any given time.

DIRECTORS

47.There shall be a Board with an authorized size of up to nine (9) persons, unless increased by a resolution adopted by resolution of the Board and with the consent required pursuant to Article 6.A(ii)(5).  The Board shall meet (whether in person, telephonically, or otherwise) no less than once in each fiscal quarter, unless otherwise determined by the Board, including the consent of all of the Preferred Shareholder Directors.

48.The remuneration to be paid to the Directors shall be such remuneration as the Directors shall determine (including the consent of all of the Preferred Shareholder Directors).  Such remuneration shall be deemed to accrue from day to day.  Subject to these Articles (including but not limited to Article 6.A), the Directors (including the consent of all of the Preferred Shareholder Directors) may by resolution award special remuneration to any Director of the Company undertaking any special work or services for, or undertaking any special mission on behalf of, the Company other than his ordinary routine work as a Director.  Any fees paid to a Director who is also counsel or solicitor to the Company, or otherwise serves it in a professional capacity shall be in addition to his remuneration as a Director.

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49.Subject to these Articles (including but not limited to Article 6.A), a Director may hold any other office or place of profit under the Company (other than the office of Auditor) in conjunction with his office of Director for such period and on such terms as to remuneration and otherwise as the Directors may determine.

50.Subject to these Articles (including but not limited to Article 6.A), a Director may act by himself or his firm in a professional capacity for the Company and he or his firm shall be entitled to remuneration for professional services as if he were not a Director.

51.A shareholder qualification for Directors may be fixed by the Company in general meeting, but unless and until so fixed no qualification shall be required.

52.Subject to these Articles (including but not limited to Article 6.A), a Director of the Company may be or become a director or other officer of or otherwise interested in any company promoted by the Company or in which the Company may be interested as shareholder or otherwise and no such Director shall be accountable to the Company for any remuneration or other benefits received by him as a director or officer of, or from his interest in, such other company.

53.In addition to any further restrictions set forth in these Articles (including but not limited to Article 6.A), no person shall be disqualified from the office of Director or prevented by such office from contracting with the Company, either as vendor, purchaser or otherwise, nor shall any such contract or any contract or transaction entered into by or on behalf of the Company in which any Director shall be in any way interested be or be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realized by any such contract or transaction by reason of such Director holding office or of the fiduciary relation thereby established.  A Director shall be at liberty to vote in respect of any contract or transaction in which he is interested; provided that the nature of the interest of any Director in any such contract or transaction shall be disclosed by him at or prior to its consideration and any vote thereon.

54.A general notice or disclosure to the Directors or otherwise contained in the minutes of a Meeting or a written resolution of the directors or any committee thereof that a Director is a member of any specified firm or company and is to be regarded as interested in any transaction with such firm or company shall be sufficient disclosure under Article 53 and after such general notice it shall not be necessary to give special notice relating to any particular transaction.

ALTERNATE DIRECTORS

55.Any Director may by a written instrument appoint an alternate who need not be a Director and an alternate is entitled to attend meetings of the Board or of any committee in the absence of the Director who appointed him and to vote or consent in place of such Director.

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POWERS AND DUTIES OF DIRECTORS

56.The business of the Company shall be managed by the Directors who may pay all expenses incurred in promoting, registering and setting up the Company, and may exercise all such powers of the Company as are not inconsistent, from time to time by the Statute, or by these Articles, or as may be prescribed by the Company in general meeting; provided that no regulations made by the Company in general meeting shall invalidate any prior act of the Directors which would have been valid if that regulation had not been made, and provided further that, for the avoidance of doubt and without limiting the generality of the foregoing, the Directors shall undertake none of those acts described in Article 6.A(ii)(5) - (9) without the prior approval therein required.  For matters described in Article 6.A(ii)(5)(a)(ii), all Directors shall cast his/her vote or abstain from voting either at the board meeting at which such matters are first proposed to be voted by the Directors or at a separate board meeting to be held no later than seven (7) days thereafter unless a different time limit has been specified (i) by other provisions of these Articles or the provisions under the Shareholders Agreement or (ii) by the Board. Without limiting the foregoing but subject to the Statute and other provisions of these Articles, the responsibilities of the Directors include but are not limited to the following:

(i)to declare any dividend;

(ii)to determine the method and price of any new equity financing;

(iii)to purchase insurance policies of the Company;

(iv)to appoint the officers of the Company; and

(v)to determine the salaries and incentive plan of the officers of the Company.

57.The Directors may from time to time and at any time by powers of attorney appoint any company, firm, person or body of persons, whether nominated directly or indirectly by the Directors, to be the attorney or attorneys of the Company for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit, and any such powers of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorneys as the Directors may think fit and may also authorize any such attorney to delegate all or any of the powers, authorities and discretions vested in him.

58.All checks, promissory notes, drafts, bills of exchange and other negotiable instruments and all receipts for monies paid to the Company shall be signed, drawn, accepted, endorsed or otherwise executed as the case may be in such manner as the Directors shall from time to time by resolution determine.

59.The Directors shall cause minutes to be made in books provided for the purpose:

(a)of all appointments of officers made by the Directors;

(b)of the names of the Directors (including those represented thereat by proxy) present at each meeting of the Directors and of any committee of the Directors;

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(c)of all resolutions and proceedings at all meetings of the Company and of the Directors and of committees of Directors.

60.Subject to these Articles (including but not limited to Article 6.A), the Directors on behalf of the Company may pay a gratuity or pension or allowance on retirement to any Director who has held any other salaried office or place of profit with the Company or to his widow or dependants and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.

61.Subject to these Articles (including but not limited to Article 6.A), the Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property and uncalled capital or any part thereof and to issue Debentures whether outright or as security for any debt, liability or obligation of the Company or of any third party.

MANAGEMENT

62.Subject to these Articles (including but not limited to Article 6.A):

(a)The Directors may from time to time provide for the management of the affairs of the Company in such manner as they shall think fit and the provisions contained in the three next following paragraphs shall be without prejudice to the general powers conferred by this paragraph.

(b)The Directors from time to time and at any time may establish any committees, local boards or agencies for managing any of the affairs of the Company and may appoint any persons to be members of such committees or local boards or any managers or agents and may fix their remuneration.

(c)The Directors from time to time and at any time may delegate to any such committee, local board, manager or agent any of the powers, authorities and discretions for the time being vested in the Directors and may authorize the members for the time being of any such local board, or any of them to fill up any vacancies therein and to act notwithstanding vacancies and any such appointment or delegation may be made on such terms and subject to such conditions as the Directors may think fit and the Directors may at any time remove any person so appointed and may annul or vary any such delegation, but no person dealing in good faith and without notice of any such annulment or variation shall be affected thereby.

(d)Any such delegates as aforesaid may be authorized by the Directors to sub-delegate all or any of the powers, authorities, and discretions for the time being vested in them.

PROCEEDINGS OF DIRECTORS

63.Subject to these Articles (including but not limited to Article 6.A), the Directors shall meet together for the dispatch of business, convening, adjourning and otherwise

44

regulating their meetings as they think fit, and questions arising at any meeting shall be decided by a majority of votes (unless a higher vote is required pursuant to the Statute or these Articles, including but not limited to Article 6.A of the Directors present at a meeting at which there is a quorum, with each having one (1) vote.  The Directors shall meet (whether in person, telephonically, or otherwise) no less than once in each fiscal quarter.

64.A Director may, and the Secretary of the Company on the requisition of a Director, shall, at any time, summon a meeting of the Directors by at least five (5) days’ notice in writing to every Director which notice shall set forth the general nature of the business to be considered; provided that notice is given pursuant to Article 93 – 97; provided further that short notice may be given on behalf of all of the Directors before, or at the meeting by the vote or consent of all the Directors.

65.The quorum necessary for the transaction of the business of the Directors is five (5) of the then elected or appointed Directors, including all of the Preferred Shareholder Directors; provided always that if there shall at any time be only a sole Director the quorum shall be one (1).  If a quorum shall not be present at any meeting of the Board, the Directors present thereat may adjourn the meeting, until a quorum shall be present, provided that, if notice of the Board meeting has been duly delivered to all Directors in accordance with Article 64, and the quorum is not present within one half hour from the time appointed for the meeting solely because of the absence of the Preferred Shareholder Directors, the meeting shall be adjourned to the third following Business Day at the same time and place (or to such other time or such other place as the Directors may determine) with notice delivered to all Directors one day prior to the adjourned meeting pursuant to Article 93 – 97 and, if at the adjourned meeting, the quorum is not present within one half hour from the time appointed for the meeting solely because of the absence of the Preferred Shareholder Directors, then any five or more directors present shall be a quorum.  Any resolution of the Board shall be passed with no less than a majority affirmative votes of directors present at the Board meeting. In the case of an equality of votes at a Board meeting, the Ordinary Director who is the chief executive officer of the Company shall have an additional casting vote.  For the purposes of this Article a proxy appointed by a Director shall only be counted in a quorum at a meeting at which the Director appointing him is not present.

66.Subject to Article 65, the continuing Directors may act notwithstanding any vacancy in their body. However, if and so long as their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum of Directors, the continuing Directors or Director may act for the purpose of increasing the number of Directors to that number, or of summoning a general meeting of the Company, but for no other purpose.

67.The Directors may elect a chairman of their board and determine the period for which he is to hold office, but if no such chairman is elected, or if at any meeting the chairman is not present, the Directors present may choose one of their numbers to be chairman of the meeting.

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68.Subject to these Articles (including but not limited to Article 6.A), the Directors may delegate any of their powers (subject to any limitations imposed on the Directors) to committees consisting of such member or members of the Board as they think fit; any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on it by the Directors and by these Articles (including but not limited to Article 6.A. A committee may meet and adjourn as it thinks proper.  Questions arising at any committee meeting shall be determined by a majority of votes of the members present.

68A.The Board shall establish and maintain (i) a Compensation Committee consisting of at least two Preferred Shareholder Directors and two Independent Directors (the “Compensation Committee”); and (ii) an Audit Committee  consisting of at least two Preferred Shareholder Directors and two Independent Directors (the “Audit Committee”).  The Compensation Committee shall propose the terms of the Company’s equity incentive plans (including the ESOP), and all grants of awards thereunder, to the Board for approval and adoption by the Board and the Members and shall have the power and authority to (a) administer the Company’s equity incentive plans (including the ESOP) and to grant options thereunder, and (b) approve all management compensation levels and arrangements, and shall have such other powers and authorities as the Board shall delegate to it.  The Audit Committee shall select the auditors of the Company and other Group Companies and approve the scope of the annual audit of the Company and other Group Companies, and shall have such other powers and authorities as the Board shall delegate to it.

69.The Company shall provide that members of the Board or of any committee thereof may participate in a meeting of the Board or of such committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this provision shall constitute presence in person at such meeting; provided that a meeting of a Board or committee shall not be valid if the Company does not make such means of participation reasonably available to the members thereof.

70.A resolution in writing (in one or more counterparts), signed by all the Directors shall be as valid and effectual as if it had been passed at a duly convened meeting of the Directors.

71.A Director may be represented at any meetings of the Board by a proxy appointed by him in which event the presence or vote of the proxy shall for all purposes be deemed to be that of the Director. The provisions of Article 41 – 44 shall apply, mutatis mutandis, to the appointment of proxies by Directors.

VACATION OF OFFICE OF DIRECTOR

72.The office of a Director shall be vacated if he or she gives notice in writing to the Company that he or she resigns the office of Director, if he or she dies or if he or she is found a lunatic or becomes of unsound mind, and such vacated office may be filled only pursuant to Article 73 or 74, as applicable.

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APPOINTMENT AND REMOVAL OF DIRECTORS

73.(a)The Management Holdcos Majority (voting as a separate class) shall be exclusively entitled to designate, appoint, remove, replace and reappoint at any time or from time to time three (3) directors on the Board (the “Ordinary Directors”).  One (1) of the Ordinary Directors shall be the then chief executive officer of the Company who shall have a casting vote in the case of an equality of votes or deadlock for whatever reason at a Board meeting. The holders of a majority of the voting power of outstanding Series A Preferred Shares (voting together as a separate class) shall be exclusively entitled to designate, appoint, remove, replace and reappoint at any time or from time to time one (1) director on the Board (the “Series A Director”). The holders of a majority of the voting power of outstanding Series B Preferred Shares (voting together as a separate class) shall be exclusively entitled to designate, appoint, remove, replace and reappoint at any time or from time to time one (1) director on the Board (the “Series B Director”). GS (or the Preferred Series C Majority in the event that GS Transfers all or any portion of the Shares held by GS in the Company, except for Transfers by GS to its Permitted Transferees) shall be exclusively entitled to designate, appoint, remove, replace and reappoint at any time or from time to time one (1) director on the Board (the “Series C Director”). The remaining three (3) directors shall be independent directors elected by a majority of the Board (including affirmative votes of the then chief executive officer of the Company and all of the Preferred Shareholder Directors); and

(b)Subject to Article 6.A(ii)(5)(a), any class or series of shares entitled to designate any individual to be elected as a Director of the Board pursuant to this Article 73 shall have the right to remove any director occupying such position and to fill any vacancy caused by the resignation, death or renewal of any director occupying such position by submitting a written notice to the Board identifying the designated director.

74.Any vacancy on the Board occurring because of the death, resignation or removal of a Director designated by the holders of any class or series of shares shall be filled by the vote or written consent of the holders of a majority of the shares of such class or series of shares.  Nomination of the chief executive officer shall be jointly made by the holders of a majority in voting power of outstanding Shares (voting together as a single class on as-converted basis).

PRESUMPTION OF ASSENT

75.A Director who is present at a meeting of the Board at which action on any Company matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent from such action with the person acting as the Secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to such person immediately after the adjournment of the meeting. Such right to dissent shall not apply to a Director who voted in favor of such action.

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SEAL

76.The Company may, if the Directors so determine, have a Seal which shall, subject to this Article, only be used by the authority of the Directors or of a committee of the Directors authorized by the Directors in that behalf and every instrument to which the Seal has been affixed shall be signed by at least one (1) person who shall be either a Director or the secretary or secretary-treasurer or some person appointed by the Directors for the purpose. The Company may have a duplicate Seal or Seals each of which shall be a facsimile of the common Seal of the Company and, if the Directors so determine, with the addition on its face of the name of every place where it is to be used. A Director, secretary or other duly authorized officer or representative or attorney may without further authority of the Directors affix the Seal of the Company over his signature alone to any document of the Company required to be authenticated by him under Seal or to be filed with the Registrar of Companies in the Cayman Islands or elsewhere wheresoever.

OFFICERS

77.The Company may have a president, a secretary or secretary-treasurer appointed by the Directors who may also from time to time appoint such other officers as they consider necessary, all for such terms, at such remuneration and to perform such duties, and subject to such provisions as to disqualification and removal as the Directors from time to time prescribe.

DIVIDENDS, DISTRIBUTIONS AND RESERVE

78.Subject to the Statute and the provisions of these Articles (including but not limited to Article 6.A), the Directors may from time to time declare dividends (including interim dividends) and distributions on shares of the Company outstanding and authorize payment of the same out of the funds of the Company lawfully available therefor.

79.Subject to the Statute and the provisions of these Articles (including but not limited to Article 6.A), the Directors may, before declaring any dividends or distributions, set aside such sums as they think proper as a reserve or reserves which shall at the discretion of the Directors, be applicable for any purpose of the Company and pending such application may, at the like discretion, be employed in the business of the Company.

80.No dividend or distribution shall be payable except out of the profits of the Company, realized or unrealized, or out of the share premium account or as otherwise permitted by the Statute.

81.Subject to the rights of persons, if any, with shares with special rights as to dividends or distributions, if dividends or distributions are to be declared on a class of shares they shall be declared and paid according to the amounts paid or credited as paid on the shares of such class outstanding on the record date for such dividend or distribution as determined in accordance with these Articles but no amount paid or credited as paid on a share in advance of calls shall be treated for the purpose of this Article as paid on the share.

82.The Directors may deduct from any dividend or distribution payable to any Member all sums of money (if any) presently payable by him to the Company on account of calls or otherwise.

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83.Subject to these Articles (including but not limited to Article 6.A), the Directors may declare that any dividend or distribution be paid wholly or partly by the distribution of specific assets and in particular of paid up shares or Debentures of any other company or in any one or more of such ways and where any difficulty arises in regard to such distribution, the Directors may settle the same as they think expedient and in particular may issue fractional certificates and fix the value for distribution of such specific assets or any part thereof and may determine that cash payments shall be made to any Members upon the footing of the value so fixed in order to adjust the rights of all Members and may vest any such specific assets in trustees as may seem expedient to the Directors.

84.Any dividend, distribution, interest or other monies payable in cash in respect of shares may be paid by check or warrant sent through the post directed to the registered address of the holder or, in the case of joint holders, to the holder who is first named on the register of Members or to such person and to such address as such holder or joint holders may in writing direct.  Every such check or warrant shall be made payable to the order of the person to whom it is sent.  Any one of two or more joint holders may give effectual receipts for any dividends, bonuses, or other monies payable in respect of the share held by them as joint holders.

85.No dividend or distribution shall bear interest against the Company.

CAPITALIZATION

86.Subject to these Articles (including but not limited to Article 6.A), upon the recommendation of the Board, the Members may by Ordinary Resolution authorize the Directors to capitalize any sum standing to the credit of any of the Company’s reserve accounts (including share premium account and capital redemption reserve fund) or any sum standing to the credit of profit and loss account or otherwise available for distribution and to appropriate such sum to Members in the proportions in which such sum would have been divisible amongst them had the same been a distribution of profits by way of dividend and to apply such sum on their behalf in paying up in full unissued shares for allotment and distribution credited as fully paid up to and amongst them in the proportion aforesaid. In such event the Directors shall do all acts and things required to give effect to such capitalization, with full power to the Directors to make such provisions as they think fit for the case of shares becoming distributable in fractions (including provisions whereby the benefit of fractional entitlements accrue to the Company rather than to the Members concerned).  Subject to these Articles (including but not limited to Article 6.A), the Directors may authorize any person to enter into, on behalf of all of the Members interested, an agreement with the Company providing for such capitalization and matters incidental thereto and any agreement made under such authority shall be effective and legally binding on all concerned.

BOOKS OF ACCOUNT

87.The Directors shall cause proper books of account to be kept with respect to:

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(a)All sums of money received and expended by the Company and the matters in respect of which the receipt or expenditure takes place;

(b)All sales and purchases of goods by the Company; and

(c)The assets and liabilities of the Company.

Proper books shall not be deemed to be kept if there are not kept such books of account as are necessary to give a true and fair view of the state of the Company’s affairs and to explain its transactions.

88.Subject to any agreement binding on the Company, the Directors shall from time to time determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of Members not being Directors, and no Member (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by Statute or authorized by the Company.

89.The Directors may from time to time cause to be prepared and to be laid before the Company in general meeting profit and loss accounts, balance sheets, group accounts (if any) and such other reports and accounts as may be required by law.

AUDIT

90.Subject to these Articles (including but not limited to Article 6.A), the Board may at any time appoint or remove an Auditor or Auditors of the Company who shall hold office for a period specified by the Board.

91.Every Auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the Directors and officers of the Company such information and explanation as may be necessary for the performance of the duties of the Auditors.

92.Auditors shall, following their appointment and at any other time during their term of office, upon request of the Directors, make a report on the accounts of the Company during their tenure of office.

NOTICES

93.Notices shall be in writing and may be given by the Company or any person entitled to give notice to any Member either personally or by sending it by next-day or second-day international courier service, fax, electronic mail or similar means to him or to his address as shown in the register of Members.

94.(a)Where a notice is sent by next-day or second-day courier service, service of the notice shall be deemed to be effected by properly addressing, pre-paying and sending by next-day or second-day service through an internationally-recognized courier a letter

50

containing the notice, with a confirmation of delivery, and to have been effected at the expiration of two (2) days after the letter containing the same is sent as aforesaid.

(b)Where a notice is sent by fax or electronic mail, service of the notice shall be deemed to be effected by properly addressing, and sending such notice through a transmitting organization, with a confirmation of delivery, and to have been effected on the day the same is sent as aforesaid.

95.A notice may be given by the Company to the joint holders of record of a share by giving the notice to the joint holder first named on the register of Members in respect of the share.

96.A notice may be given by the Company to the person or persons which the Company has been advised are entitled to a share or shares in consequence of the death or bankruptcy of a Member by sending it, subject to Article 94 and 95, to them by name, or by the title of representatives of the deceased, or trustee of the bankrupt, or by any like description at the address supplied for that purpose by the persons claiming to be so entitled, or at the option of the Company by giving the notice in any manner in which the same might have been given if the death or bankruptcy had not occurred.

97.Notice of every general meeting shall be given in any manner hereinbefore authorized to:

(a)every person shown as a Member in the register of Members as of the record date for such meeting except that in the case of joint holders the notice shall be sufficient if given to the joint holder first named in the register of Members; and

(b)every person upon whom the ownership of a share devolves by reason of his being a legal personal representative or a trustee in bankruptcy of a Member of record where the Member of record but for his death or bankruptcy would be entitled to receive notice of the meeting.

No other person shall be entitled to receive notices of general meetings pursuant to these Articles.

WINDING UP

98.If the Company shall be wound up, any liquidator must be approved by a Special Resolution.

99.If the Company shall be wound up, the assets available for distribution amongst the Members shall be distributed in accordance with Article 6.A(ii)(2); provided that no Member shall be compelled to accept any shares or other securities whereon there is any liability.

INDEMNITY & INSURANCE

100.(a)To the maximum extent permitted by applicable law, the Directors and officers for the time being of the Company and any trustee for the time being acting in relation to

51

any of the affairs of the Company and their heirs, executors, administrators and personal representatives respectively shall be indemnified out of the assets of the Company from and against all actions, proceedings, costs, charges, losses, damages and expenses which they or any of them shall or may incur or sustain by reason of any act done or omitted in or about the execution of their duty in their respective offices or trusts, except such (if any) as they shall incur or sustain by or through their own willful neglect or willful default, and no such Director or officer or trustee shall be answerable for the acts, receipts, neglects or defaults of any other Director or officer or trustee or for joining in any receipt for the sake of conformity or for the solvency or honesty of any banker or other persons with whom any monies or effects belonging to the Company may be lodged or deposited for safe custody or for any insufficiency of any security upon which any monies of the Company may be invested or for any other loss or damage due to any such cause as aforesaid or which may happen in or about the execution of his office or trust unless the same shall happen through the willful neglect or willful default of such Director or officer or trustee.

(b)To the maximum extent permitted by applicable law, the Directors and officers for the time being of the Company and any trustee for the time being acting in relation to any of the affairs of the Company and their heirs, executors, administrators and personal representatives respectively shall not be personally liable to the Company or its Members for monetary damages for breach of their duty in their respective offices, except such (if any) as they shall incur or sustain by or through their own willful neglect or willful default respectively.

(c)Upon the request of the Preferred Shareholder Majority, the Company shall as promptly as practicable, purchase and maintain directors’ and officers’ insurance from a carrier and in an amount as shall be agreed by the Preferred Shareholder Majority, provided that such insurance coverage is available at commercially reasonable rates as determined by the Preferred Shareholder Majority, in relation to any person who is or was a director or an officer of the Company, or who at the request of the Company is or was serving as a director or an officer of, or in any other capacity is or was acting for, another company or a partnership, joint venture, trust or other enterprise, against any liability asserted against the person and incurred by the person in that capacity, whether or not the Company has or would have had the power to indemnify the person against the liability under this Article 100.

FINANCIAL YEAR

101.Unless a majority of the Board agrees otherwise (which majority must include the all of Preferred Shareholder Directors), the financial year of the Company shall end on December 31 in each year and, following the year of incorporation, shall begin on January 1 in each year.

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TRANSFER BY WAY OF CONTINUATION

102.If the Company is exempted as defined in the Statute, it shall, subject to the provisions of the Statute and with the approval of (i) a Special Resolution and (ii) the holders of a majority of the then outstanding Preferred Shares (voting together as a separate class on an as-converted basis), have the power to register by way of continuation as a body corporate under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

[The remainder of this page has been left intentionally blank.]

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EX-3.2

Exhibit 3.2

THE COMPANIES LAW

OF THE CAYMAN ISLANDS

COMPANY LIMITED BY SHARES

NOTICE OF SPECIAL RESOLUTION

OF

GRIDSUM HOLDING INC.

(the “Company”)

At an extraordinary general meeting of the Company held on August 23, 2016, the following resolution was passed as a special resolution:

1.With effect from the date of this meeting, the definition of “Qualified IPO” under the Current Articles be amended to read in its entirety as follows:

“‘Qualified IPO’ means the closing of the first firm commitment fully underwritten public offering of Ordinary Shares of the Company and the listing of such Ordinary Shares on the New York Stock Exchange, the Nasdaq Global Market System, the Main Board of the Hong Kong Stock Exchange, Shanghai Stock Exchange, Shenzhen Stock Exchange or any other reputable international exchange or quotation system that is approved in writing by the Preferred Shareholder Majority.”

Jodi Hydes

Authorised Signatory for

International Corporation Services Ltd.

26 August, 2016

EX-3.3

Exhibit 3.3

THE COMPANIES LAW

OF THE CAYMAN ISLANDS

COMPANY LIMITED BY SHARES

FIFTH AMENDED AND RESTATED

MEMORANDUM AND ARTICLES OF ASSOCIATION

OF

GRIDSUM HOLDING INC.

(adopted by a Special Resolution passed on February 2, 2016 and to become effective immediately prior to the completion of the Company’s initial public offering of its Class B Ordinary Shares represented by American depository shares)

THE COMPANIES LAW

OF THE CAYMAN ISLANDS

COMPANY LIMITED BY SHARES

FIFTH AMENDED AND RESTATED

MEMORANDUM OF ASSOCIATION

OF

GRIDSUM HOLDING INC.

(adopted by a Special Resolution passed on February 2, 2016 and to become effective immediately prior to the completion of the Company’s initial public offering of its Class B Ordinary Shares represented by American depository shares)

1.The name of the Company is Gridsum Holding Inc.

2.The Registered Office of the Company is situated at the offices of International Corporation Services Ltd., Harbour Place 2nd Floor, 103 South Church Street, P.O. Box 472, George Town, Grand Cayman KY1-1106, or at such other location within the Cayman Islands as the Directors may from time to time determine.

3.The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by the Companies Law or any other law of the Cayman Islands.

4.The Company shall have and be capable of exercising all the functions of a natural person of full capacity irrespective of any question of corporate benefit as provided by the Companies Law.

5.The Company will not trade in the Cayman Islands with any person, firm or corporation except in furtherance of the business of the Company carried on outside the Cayman Islands; provided that nothing in this section shall be construed as to prevent the Company effecting and concluding contracts in the Cayman Islands, and exercising in the Cayman Islands all of its powers necessary for the carrying on of its business outside the Cayman Islands.

6.The liability of each Shareholder of the Company is limited to the amount, if any, unpaid on the Shares held by such Shareholder.

7.The authorised share capital of the Company is US$200,000, divided into (i) 20,000,000 Class A ordinary shares with a par value of US$0.001 each, and (ii) 180,000,000 Class B ordinary shares with a par value of US$0.001 each, provided always that subject to the Companies Law and the Articles of Association, the Company shall have power to redeem or purchase any of its Shares and to increase or reduce its authorised share capital and to sub-divide or consolidate the said Shares or any of them and to issue all or any part of its capital whether original, redeemed, increased or reduced with or without any preference, priority, special privilege or other rights or subject to any postponement of rights or to any conditions or restrictions whatsoever and so that unless the conditions of issue shall otherwise

2

expressly provide, every issue of shares whether stated to be ordinary, preference or otherwise shall be subject to the powers on the part of the Company hereinbefore provided.

8.The Company has the power contained in the Companies Law to deregister in the Cayman Islands and be registered by way of continuation in some other jurisdiction.

9.Capitalized terms that are not defined in this Memorandum of Association bear the same meanings as those given in the Articles of Association of the Company.

3

TABLE OF CONTENTS

CLAUSE	PAGE
TABLE A	5
INTERPRETATION	5
PRELIMINARY	10
SHARES	10
CLASS A ORDINARY SHARES AND CLASS B ORDINARY SHARES	12
MODIFICATION OF RIGHTS	13
CERTIFICATES	14
FRACTIONAL SHARES	14
LIEN	15
CALLS ON SHARES	15
FORFEITURE OF SHARES	16
TRANSFER OF SHARES	17
TRANSMISSION OF SHARES	18
REGISTRATION OF EMPOWERING INSTRUMENTS	19
ALTERATION OF SHARE CAPITAL	19
REDEMPTION, PURCHASE AND SURRENDER OF SHARES	19
TREASURY SHARES	20
GENERAL MEETINGS	20
NOTICE OF GENERAL MEETINGS	21
PROCEEDINGS AT GENERAL MEETINGS	21
VOTES OF SHAREHOLDERS	22
CORPORATIONS ACTING BY REPRESENTATIVES AT MEETINGS	24
DEPOSITARY AND CLEARING HOUSES	24
DIRECTORS	24
ALTERNATE DIRECTOR OR PROXY	25
POWERS AND DUTIES OF DIRECTORS	26
BORROWING POWERS OF DIRECTORS	28
THE SEAL	28
DISQUALIFICATION OF DIRECTORS	28
PROCEEDINGS OF DIRECTORS	29
PRESUMPTION OF ASSENT	31
DIVIDENDS	31
ACCOUNTS, AUDIT AND ANNUAL RETURN AND DECLARATION	32
CAPITALISATION OF RESERVES	33
SHARE PREMIUM ACCOUNT	34
NOTICES	34
INFORMATION	35
INDEMNITY	35
FINANCIAL YEAR	36
NON-RECOGNITION OF TRUSTS	36
AMENDMENT OF ARTICLES OF ASSOCIATION	37
CLOSING OF REGISTER OR FIXING RECORD DATE	37
REGISTRATION BY WAY OF CONTINUATION	38
DISCLOSURE	38

4

THE COMPANIES LAW

OF THE CAYMAN ISLANDS

COMPANY LIMITED BY SHARES

FIFTH AMENDED AND RESTATED

ARTICLES OF ASSOCIATION

OF

GRIDSUM HOLDING INC.

(adopted by a Special Resolution passed on February 2, 2016 and to become effective immediately prior to the completion of the Company’s initial public offering of its Class B Ordinary Shares represented by American depository shares)

TABLE A

The Regulations contained or incorporated in Table A in the First Schedule of the Law shall not apply to the Company and the following Articles shall comprise the Articles of Association of the Company.

INTERPRETATION

1.In these Articles, the following defined terms will have the meanings ascribed to them, if not inconsistent with the subject or context:

“ADS”

means an American depositary share representing Class B Ordinary Shares;

“Affiliate”

means in respect of a Person, any other Person that, directly or indirectly (including through one or more intermediaries), controls, is controlled by, or is under common control with, such Person, and (i) in the case of a natural person, shall include, without limitation, such person’s spouse, parents, children, siblings, mother-in-law and father-in-law and brothers and sisters-in-law, a trust solely for the benefit of any of the foregoing, a company, partnership or any natural person or entity wholly owned by one or more of the foregoing, and (ii) in the case of an entity, shall include a partnership, a corporation or any natural person or entity which directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such entity. The term “control” shall mean the ownership, directly or indirectly, of securities possessing more than fifty percent (50%) of the voting power of the corporation, or the partnership or other entity (other than, in the case of corporation, securities having such power only by reason of the happening of a contingency not within the reasonable control of such partnership, corporation, natural person or entity), or having the power to control the

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	management or elect a majority of members to the board of directors or equivalent decision-making body of such corporation, partnership or other entity;
“Articles” or “Articles of Association”	means these articles of association of the Company, as amended or substituted from time to time;
“Audit Committee”	means the audit committee of the Company formed by the Board in accordance with Article 105, or any successor audit committee of the Company;
“Board” and “Board of Directors” and “Directors”	means the directors of the Company for the time being, or as the case may be, the directors assembled as a board or as a committee thereof;
“Chairman”	means the chairman of the Board of Directors;
“Class” or “Classes”	means any class or classes of Shares as may from time to time be issued by the Company;
“Class A Ordinary Share”	an Ordinary Share of a par value of US$0.001 in the capital of the Company, designated as a Class A Ordinary Shares and having the rights provided for in these Articles.
“Class B Ordinary Share”	an Ordinary Share of a par value of US$0.001 in the capital of the Company, designated as a Class B Ordinary Share and having the rights provided for in these Articles.
“Commission”	means the Securities and Exchange Commission of the United States of America or any other federal agency for the time being administering the Securities Act;
“Company”	means Gridsum Holding Inc., a Cayman Islands exempted company;
“Companies Law”	means the Companies Law (2013 revision) of the Cayman Islands and any statutory amendment or re-enactment thereof;
“Company’s Website”	means the main corporate and investors relations website of the Company, the address or domain name of which has been notified to Shareholders;
“Compensation Committee”	means the compensation committee of the Company formed by the Board in accordance with Article 106, or any successor compensation committee of the Company;
“Day”	means calendar day;
“Designated Stock Exchange”	means the NASDAQ Stock Market in the United States or any other stock exchange on which the ADSs are listed for

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	trading;
“Designated Stock Exchange Rules”	means the relevant code, rules and regulations, as amended, from time to time, applicable as a result of the original and continued listing of any Shares or ADSs on the Designated Stock Exchange;
“electronic”	means the meaning given to it in the Electronic Transactions Law and any amendment thereto or re-enactments thereof for the time being in force and includes every other law incorporated therewith or substituted therefor;
“electronic communication”	means electronic posting to the Company’s Website, transmission to any number, address or internet website or other electronic delivery methods as otherwise decided and approved by not less than two-thirds (2/3) of the vote of the Board;
“Electronic Transactions Law”	means the Electronic Transactions Law (2003 Revision) of the Cayman Islands and any statutory amendment or re-enactment thereof;
“Independent Director”	means a director who is an independent director as defined in the Designated Stock Exchange Rules;
“Law”	means the Companies Law and every other law and regulation of the Cayman Islands for the time being in force concerning companies and affecting the Company;
“Memorandum”	means the memorandum of association of the Company, as amended or substituted from time to time;
“Month”	means calendar month;
“Ordinary Resolution”	means a resolution:
	(a)    passed by a simple majority of the votes cast by such Shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the Company and in computing a majority where a poll is taken, regard shall be had to the number of votes to which each Shareholder is entitled; or
	(b)    approved in writing by all of the Shareholders entitled to vote at a general meeting of the Company in one or more instruments each signed by one or more of the Shareholders and the effective date of the resolution so adopted shall be the date on which the instrument, or the last of such instruments, if more than one, is executed;
“Ordinary Shares”	means an ordinary share of a nominal or par value of US$0.001 each in the capital of the Company, including the

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	Class A Ordinary Shares and the Class B Ordinary Shares;
“paid up”	means paid up as to the par value in respect of the issue of any Shares and includes credited as paid up;
“Person”	means any natural person, firm, company, joint venture, partnership, corporation, association or other entity (whether or not having a separate legal personality) or any of them as the context so requires;
“Register”	means the register of Members of the Company maintained in accordance with the Companies Law;
“Registered Office”	means the registered office of the Company as required by the Companies Law;
“Seal”	means the common seal of the Company (if adopted) including any facsimile thereof;
“Secretary”	means any Person appointed by the Directors to perform any of the duties of the secretary of the Company;
“Securities Act”	means the Securities Act of 1933 of the United States of America, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time;
“Share”	means a share in the capital of the Company. All references to “Shares” herein shall be deemed to be Shares of any or all Classes as the context may require. For the avoidance of doubt in these Articles, the expression “Share” shall include a fraction of a Share;
“Shareholder” or “Member”	means a Person who is registered as the holder of Shares in the Register;
“Share Premium Account”	means the share premium account established in accordance with these Articles and the Companies Law;
“signed”	means bearing a signature or representation of a signature affixed by mechanical means or an electronic symbol or process attached to or logically associated with an electronic communication and executed or adopted by a person with the intent to sign the electronic communication;
“Special Resolution”	means a special resolution of the Company passed in accordance with the Law, being a resolution:
	(a)    passed by a majority of not less than two-thirds of the votes of such Shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the Company of which notice

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	specifying the intention to propose the resolution as a special resolution has been duly given, and in computing a majority where a poll is taken, regard shall be had to the number of votes to which each Shareholder is entitled; or
	(b)    approved in writing by all of the Shareholders entitled to vote at a general meeting of the Company in one or more instruments each signed by one or more of the Shareholders and the effective date of the special resolution so adopted shall be the date on which the instrument or the last of such instruments, if more than one, is executed;
“Treasury Share”	means a Share held in the name of the Company as a treasury share in accordance with the Companies Law;
“United States”	means the United States of America, its territories, its possessions and all areas subject to its jurisdiction; and
“year”	means calendar year.

2.In these Articles, save where the context requires otherwise:

(a)words importing the singular number shall include the plural number and vice versa;

(b)words importing the masculine gender only shall include the feminine gender and any Person as the context may require;

(c)the word “may” shall be construed as permissive and the word “shall” shall be construed as imperative;

(d)reference to a dollar or dollars (or US$) and to a cent or cents is reference to dollars and cents of the United States of America;

(e)reference to a statutory enactment shall include reference to any amendment or re-enactment thereof for the time being in force;

(f)reference to any determination by the Directors shall be construed as a determination by the Directors in their sole and absolute discretion and shall be applicable either generally or in any particular case;

(g)reference to “in writing” shall be construed as written or represented by any means reproducible in writing, including any form of print, lithograph, email, facsimile, photograph or telex or represented by any other substitute or format for storage or transmission for writing or partly one and partly another;

(h)any requirements as to delivery under the Articles include delivery in the form of an electronic record (as defined in the Electronic Transactions Law) or an electronic communication;

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(i)any requirements as to execution or signature under the Articles including the execution of the Articles themselves can be satisfied in the form of an electronic signature as defined in the Electronic Transactions Law; and

(j)Sections 8 and 19 of the Electronic Transactions Law shall not apply.

3.Subject to the last two preceding Articles, any words defined in the Companies Law shall, if not inconsistent with the subject or context, bear the same meaning in these Articles.

PRELIMINARY

4.The business of the Company may be conducted as the Directors see fit.

5.The Registered Office shall be at such address in the Cayman Islands as the Directors may from time to time determine.  The Company may in addition establish and maintain such other offices and places of business and agencies in such places as the Directors may from time to time determine.

6.The expenses incurred in the formation of the Company and in connection with the offer for subscription and issue of Shares shall be paid by the Company.  Such expenses may be amortised over such period as the Directors may determine and the amount so paid shall be charged against income and/or capital in the accounts of the Company as the Directors shall determine.

7.The Directors shall keep, or cause to be kept, the Register at such place as the Directors may from time to time determine and, in the absence of any such determination, the Register shall be kept at the Registered Office.

SHARES

8.Subject to these Articles, all Shares for the time being unissued shall be under the control of the Directors who may:

(a)issue, allot and dispose of the same to such Persons, in such manner, on such terms and having such rights and being subject to such restrictions as they may from time to time determine; and

(b)grant options with respect to such Shares and issue warrants or similar instruments with respect thereto;

and, for such purposes, the Directors may reserve an appropriate number of Shares for the time being unissued.  For the avoidance of doubt, the Directors may in their absolute discretion and without approval of the existing Members, issue shares, grant rights over existing shares or issue other securities in one or more Classes or series as they deem necessary and appropriate and determine the designations, powers, preferences, privileges and other rights attaching to such Shares or securities, including dividend rights, voting rights, conversion rights, terms of redemption and liquidation preferences, any or all of which may be greater than the powers, preferences, privileges and rights associated with the then issued and outstanding Shares held by existing Members, at such times and on such other terms as they think proper.  The Company shall not issue Shares to bearer.

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9.Subject to the Companies Law, these Articles and rules of Designated Stock Exchange, the Directors may authorise the division of Shares into any number of Classes and the different Classes shall be authorised, established and designated (or re-designated as the case may be) and the variations in the relative rights (including, without limitation, voting, dividend and redemption rights), restrictions, preferences, privileges and payment obligations as between the different Classes (if any) may be fixed and determined by the Directors or by a Special Resolution.  The Directors may issue Shares with such preferred or other rights, all or any of which may be greater than the rights of Ordinary Shares, at such time and on such terms as they may think appropriate.  Notwithstanding Article 19, the Directors may provide, out of the unissued shares (other than unissued Ordinary Shares), for series of preference shares in their absolute discretion and without approval of the Members; provided, however, before any preference shares of any such series are issued, the Directors shall fix, by resolution or resolutions, the following provisions of the preference shares thereof:

(a)the designation of such series, the number of preferred shares to constitute such series and the subscription price thereof if different from the par value thereof;

(b)whether the shares of such series shall have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting rights, which may be general or limited;

(c)the dividends, if any, payable on such series, whether any such dividends shall be cumulative, and, if so, from what dates, the conditions and dates upon which such dividends shall be payable, the preference or relation which such dividends shall bear to the dividends payable on any shares of any other class or any other series of preferred shares;

(d)whether the preferred shares of such series shall be subject to redemption by the Company, and, if so, the times, prices and other conditions of such redemption;

(e)the amount or amounts payable upon preferred shares of such series upon, and the rights of the holders of such series in, a voluntary or involuntary liquidation, dissolution or winding up, or upon any distribution of the assets, of the Company;

(f)whether the preferred shares of such series shall be subject to the operation of a retirement or sinking fund and, if so, the extent to and manner in which any such retirement or sinking fund shall be applied to the purchase or redemption of the preferred shares of such series for retirement or other corporate purposes and the terms and provisions relative to the operation thereof;

(g)whether the preferred shares of such series shall be convertible into, or exchangeable for, shares of any other class or any other series of preferred shares or any other securities and, if so, the price or prices or the rate or rates of conversion or exchange and the method, if any, of adjusting the same, and any other terms and conditions of conversion or exchange;

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(h)the limitations and restrictions, if any, to be effective while any preferred shares of such series are outstanding upon the payment of dividends or the making of other distributions on, and upon the purchase, redemption or other acquisition by the Company of, the existing shares or shares of any other class of shares or any other series of preferred shares;

(i)the conditions or restrictions, if any, upon the creation of indebtedness of the Company or upon the issue of any additional shares, including additional shares of such series or of any other class of shares or any other series of preferred shares; and

(j)any other powers, preferences and relative, participating, optional and other special rights, and any qualifications, limitations and restrictions thereof.

10.The Company may insofar as may be permitted by law, pay a commission to any Person in consideration of his subscribing or agreeing to subscribe whether absolutely or conditionally for any Shares.  Such commissions may be satisfied by the payment of cash or the lodgement of fully or partly paid-up Shares or partly in one way and partly in the other.  The Company may also pay such brokerage as may be lawful on any issue of Shares.

11.The Directors may refuse to accept any application for Shares, and may accept any application in whole or in part, for any reason or for no reason.

CLASS A ORDINARY SHARES AND CLASS B ORDINARY SHARES

12.Holders of Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class on all resolutions submitted to a vote by the Members.  Each Class A Ordinary Share shall be entitled to ten (10) votes on all matters subject to vote at general meetings of the Company, and each Class B Ordinary Share shall be entitled to one (1) vote on all matters subject to vote at general meetings of the Company.

13.Each Class A Ordinary Share is convertible into one (1) Class B Ordinary Share at any time by the holder thereof.  The right to convert shall be exercisable by the holder of the Class A Ordinary Share delivering a written notice to the Company that such holder elects to convert a specified number of Class A Ordinary Shares into Class B Ordinary Shares.

14.Upon any sale, transfer, assignment or disposition of beneficial ownership of any Class A Ordinary Share by a Shareholder or a beneficial owner of such Class A Ordinary Shares to any person who is not an Affiliate of such Shareholder or the beneficial owner, such Class A Ordinary Share shall be automatically and immediately converted into one Class B Ordinary Share.  For purposes of Article 14, beneficial ownership shall have the meaning defined in Rule 13d-3 under the U.S. Securities Exchange Act of 1934, as amended.  For the avoidance of doubt, (i) a sale, transfer, assignment or disposition shall be effective upon the Company’s registration of such sale, transfer, assignment or disposition in its Register of Members (or completion of comparable procedures applicable to a Shareholder or a beneficial owner); and (ii) the creation of any pledge, charge, encumbrance or other third party right of whatever description on any Class A Ordinary Shares to secure a holder’s

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contractual or legal obligations shall not be deemed as a sale, transfer, assignment or disposition unless and until any such pledge, charge, encumbrance or other third party right is enforced and results in the third party holding legal title to the related Class A Ordinary Shares, in which case all the related Class A Ordinary Shares shall be automatically converted into the same number of Class B Ordinary Shares.

15.Any conversion of Class A Ordinary Shares into Class B Ordinary Shares pursuant to these Articles shall be effected by means of the re-designation of each relevant Class A Ordinary Share as a Class B Ordinary Share.

16.Class B Ordinary Shares are not convertible into Class A Ordinary Shares under any circumstances.

17.Save and except for voting rights and conversion rights as set out in Articles 12 to 16 (inclusive), the Class A Ordinary Shares and the Class B Ordinary Shares shall rank pari passu and shall have the same rights, preferences, privileges and restrictions as set forth herein.

18.Without limiting the generality of Article 17:

(a)Each holder of Class A Ordinary Shares and Class B Ordinary Shares shall be entitled to share equally, on a per share basis, in such dividends and other distributions of cash, property or shares of the Company as may be declared by the Board from time to time; provided, however, that in the event that such dividend is paid in the form of shares of the Company or rights to acquire such shares, the holders of Class A Ordinary Shares shall receive Class A Ordinary Shares or rights to acquire Class A Ordinary Shares, as the case may be, and the holders of Class B Ordinary Shares shall receive Class B Ordinary Shares or rights to acquire Class B Ordinary Shares, as the case may be.

(b)In the event of a winding-up or dissolution of the Company, whether voluntary or involuntary or for the purpose of a reorganization or otherwise or upon any distribution of capital, the holders of Class A Ordinary Shares and Class B Ordinary Shares shall be entitled to share equally, on a per share basis, the surplus assets of the Company.

MODIFICATION OF RIGHTS

19.Whenever the capital of the Company is divided into different Classes, the rights attached to any such Class may, subject to any rights or restrictions for the time being attached to any Class, only be varied with the sanction of a Special Resolution passed at a general meeting of the holders of the Shares of that Class.  To every such separate meeting, all the provisions of these Articles relating to general meetings of the Company or to the proceedings thereat shall, mutatis mutandis, apply, except that the necessary quorum shall be one or more Persons at least holding or representing by proxy one-third (1/3) in nominal or par value amount of the issued Shares of the relevant Class (but so that if at any adjourned meeting of such holders a quorum as above defined is not present, those Shareholders who are present shall form a quorum) and that, subject to any rights or restrictions for the time being attached to the Shares of that Class, every Shareholder of the Class shall on a poll have one vote for each Share of the Class held by him.  For the purposes of this Article, the Directors may

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treat all the Classes or any two or more Classes as forming one Class if they consider that all such Classes would be affected in the same way by the proposals under consideration, but in any other case shall treat them as separate Classes.

20.The rights conferred upon the holders of the Shares of any Class issued with preferred or other rights shall not, subject to any rights or restrictions for the time being attached to the Shares of that Class, be deemed to be materially adversely varied by, inter alia, the creation, allotment or issue of further Shares ranking pari passu with or subsequent to them or the redemption or purchase of any Shares of any Class by the Company.  The rights of the holders of Shares shall not be deemed to be materially adversely varied by the creation or issue of Shares with preferred or other rights including, without limitation, the creation of Shares with enhanced or weighted voting rights.

CERTIFICATES

21.Every Person whose name is entered as a Member in the Register may, in the discretion of the Directors, receive without payment a certificate within two months after allotment or lodgement of transfer (or within such other period as the conditions of issue shall provide) in the form determined by the Directors.  All certificates shall specify the Share or Shares held by that Person and the amount paid up thereon, provided that in respect of a Share or Shares held jointly by several persons, the Company shall not be bound to issue more than one certificate, and delivery of a certificate for a Share to one of several joint holders shall be sufficient delivery to all.  All certificates for Shares shall be delivered personally or sent through the post addressed to the Member entitled thereto at the Member’s registered address as appearing in the Register.

22.Every share certificate of the Company shall bear legends required under the applicable laws, including the Securities Act.

23.Any two or more certificates representing Shares of any one Class held by any Member may at the Member’s request be cancelled and a single new certificate for such Shares may be issued in lieu on payment (if the Directors shall so require) of US$1.00 or such smaller sum as the Directors shall determine.

24.If a share certificate shall be damaged or defaced or alleged to have been lost, stolen or destroyed, a new certificate representing the same Shares may be issued to the relevant Member upon request subject to delivery up of the old certificate or (if alleged to have been lost, stolen or destroyed) compliance with such conditions as to evidence and indemnity and the payment of out-of-pocket expenses of the Company in connection with the request as the Directors may think fit.

25.In the event that Shares are held jointly by several persons, any request may be made by any one of the joint holders and if so made shall be binding on all of the joint holders.

FRACTIONAL SHARES

26.The Directors may issue fractions of a Share and, if so issued, a fraction of a Share shall be subject to and carry the corresponding fraction of liabilities (whether with

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respect to nominal or par value, premium, contributions, calls or otherwise), limitations, preferences, privileges, qualifications, restrictions, rights (including, without prejudice to the generality of the foregoing, voting and participation rights) and other attributes of a whole Share.  If more than one fraction of a Share of the same Class is issued to or acquired by the same Shareholder such fractions shall be accumulated.

LIEN

27.The Company has a first and paramount lien on every Share (whether or not fully paid) for all amounts (whether presently payable or not) payable at a fixed time or called in respect of that Share.  The Company also has a first and paramount lien on every Share registered in the name of a Person indebted or under liability to the Company (whether he is the sole registered holder of a Share or one of two or more joint holders) for all amounts owing by him or his estate to the Company (whether or not presently payable).  The Directors may at any time declare a Share to be wholly or in part exempt from the provisions of this Article.  The Company’s lien on a Share extends to any amount payable in respect of it.

28.The Company may sell, in such manner as the Directors in their absolute discretion think fit, any Share on which the Company has a lien, but no sale shall be made unless an amount in respect of which the lien exists is presently payable nor until the expiration of fourteen (14) days after a notice in writing, demanding payment of such part of the amount in respect of which the lien exists as is presently payable, has been given to the registered holder for the time being of the Share, or the Persons entitled thereto by reason of his death or bankruptcy.

29.For giving effect to any such sale, the Directors may authorise a Person to transfer the Shares sold to the purchaser thereof.  The purchaser shall be registered as the holder of the Shares comprised in any such transfer and the Purchaser shall not be bound to see to the application of the purchase money, nor shall the Purchaser’s title to the Shares be affected by any irregularity or invalidity in the proceedings in reference to the sale.

30.The proceeds of the sale after deduction of expenses, fees and commission incurred by the Company shall be received by the Company and applied in payment of such part of the amount in respect of which the lien exists as is presently payable, and the residue shall (subject to a like lien for sums not presently payable as existed upon the Shares prior to the sale) be paid to the Person entitled to the Shares immediately prior to the sale

CALLS ON SHARES

31.Subject to the terms of the allotment, the Directors may from time to time make calls upon the Shareholders in respect of any moneys unpaid on their Shares, and each Shareholder shall (subject to receiving at least fourteen (14) days’ notice specifying the time or times of payment) pay to the Company at the time or times so specified the amount called on such Shares.

32.The joint holders of a Share shall be jointly and severally liable to pay calls in respect thereof.

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33.If a sum called in respect of a Share is not paid before or on the day appointed for payment thereof, the Person from whom the sum is due shall pay interest upon the sum at the rate of eight percent (8%) per annum from the day appointed for the payment thereof to the time of the actual payment, but the Directors shall be at liberty to waive payment of that interest wholly or in part.

34.The provisions of these Articles as to the liability of joint holders and as to payment of interest shall apply in the case of non-payment of any sum which, by the terms of issue of a Share, becomes payable at a fixed time, whether on account of the amount of the Share, or by way of premium, as if the same had become payable by virtue of a call duly made and notified.

35.The Directors may make arrangements with respect to the issue of partly paid Shares for a difference between the Shareholders, or the particular Shares, in the amount of calls to be paid and in the times of payment.

36.The Directors (i) may, if they think fit, receive from any Shareholder willing to advance the same all or any part of the moneys uncalled and unpaid upon any partly paid Shares held by him, and (ii) upon all or any of the moneys so advanced, the Directors may (until the same would, but for such advance, become presently payable) pay interest at such rate (not exceeding without the sanction of an Ordinary Resolution, eight percent (8%) per annum) as may be agreed upon between the Shareholder paying the sum in advance and the Directors.  No such sum paid in advance of calls shall entitle the Member paying such sum to any portion of a dividend declared in respect of any period prior to the date upon which such sum would, but for such payment, become presently payable.

FORFEITURE OF SHARES

37.If a Shareholder fails to pay any call or instalment of a call in respect of partly paid Shares on the day appointed for payment, the Directors may, at any time thereafter during such time as any part of such call or instalment remains unpaid, serve a notice on him requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued.

38.The notice shall name a further day (not earlier than the expiration of fourteen (14) days from the date of the notice) on or before which the payment required by the notice is to be made, and shall state that in the event of non-payment at or before the time appointed the Shares in respect of which the call was made will be liable to be forfeited.

39.If the requirements of any such notice as aforesaid are not complied with, any Share in respect of which the notice has been given may at any time thereafter, before the payment required by notice has been made, be forfeited by a resolution of the Directors to that effect.

40.A forfeited Share may be sold or otherwise disposed of on such terms and in such manner as the Directors think fit, and at any time before a sale or disposition the forfeiture may be cancelled on such terms as the Directors think fit.

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41.A Person whose Shares have been forfeited shall cease to be a Shareholder in respect of the forfeited Shares, but shall, notwithstanding, remain liable to pay to the Company all moneys which at the date of forfeiture were payable by him to the Company in respect of the Shares forfeited, but his liability shall cease if and when the Company receives payment in full of the amount unpaid on the Shares forfeited.

42.A certificate in writing under the hand of a Director of the Company that a Share has been duly forfeited on a date stated in the certificate, shall be conclusive evidence of the facts in the declaration as against all Persons claiming to be entitled to the Share.

43.The Company may receive the consideration, if any, given for a Share on any sale or disposition thereof pursuant to the provisions of these Articles as to forfeiture and may execute a transfer of the Share in favour of the Person to whom the Share is sold or disposed of and that Person shall be registered as the holder of the Share, and shall not be bound to see to the application of the purchase money, if any, nor shall his title to the Shares be affected by any irregularity or invalidity in the proceedings in reference to the disposition or sale.

44.The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any sum which by the terms of issue of a Share becomes due and payable, whether on account of the amount of the Share, or by way of premium, as if the same had been payable by virtue of a call duly made and notified.

TRANSFER OF SHARES

45.The instrument of transfer of any Share shall be in writing and in any usual or common form or such other form as the Directors may, in their absolute discretion, approve and be executed by or on behalf of the transferor and if in respect of a nil or partly paid up Share, or if so required by the Directors, shall also be executed on behalf of the transferee and shall be accompanied by the certificate (if any) of the Shares to which it relates and such other evidence as the Directors may reasonably require to show the right of the transferor to make the transfer.  The transferor shall be deemed to remain a Shareholder until the name of the transferee is entered in the Register in respect of the relevant Shares.

46.(a)The Directors may in their absolute discretion decline to register any transfer of Shares which is not fully paid up or on which the Company has a lien.

(b)The Directors may also decline to register any transfer of any Share unless:

i.the instrument of transfer is lodged with the Company, accompanied by the certificate for the Shares to which it relates and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer;

ii.the instrument of transfer is in respect of only one Class of Shares;

iii.the instrument of transfer is properly stamped, if required;

iv.in the case of a transfer to joint holders, the number of joint holders to whom the Share is to be transferred does not exceed four;

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v.the Shares transferred are free of any lien in favour of the Company; and

vi.a fee of such maximum sum as the Designated Stock Exchange may determine to be payable, or such lesser sum as the Board of Directors may from time to time require, is paid to the Company in respect thereof.

47.The registration of transfers may, on fourteen (14) days’ notice being given by advertisement in such one or more newspapers, by electronic means or by any other means in accordance with the Designated Stock Exchange Rules, be suspended and the Register closed at such times and for such periods as the Directors may, in their absolute discretion, from time to time determine, provided always that such registration of transfer shall not be suspended nor the Register of Members closed for more than thirty (30) days in any year.

48.All instruments of transfer that are registered shall be retained by the Company.  If the Directors refuse to register a transfer of any Shares, they shall within three months after the date on which the transfer was lodged with the Company send to each of the transferor and the transferee notice of the refusal.

TRANSMISSION OF SHARES

49.The legal personal representative of a deceased sole holder of a Share shall be the only Person recognised by the Company as having any title to the Share.  In the case of a Share registered in the name of two or more holders, the survivors or survivor, or the legal personal representatives of the deceased survivor, shall be the only Person recognised by the Company as having any title to the Share.

50.Any Person becoming entitled to a Share in consequence of the death or bankruptcy of a Shareholder shall upon such evidence being produced as may from time to time be required by the Directors, have the right either to be registered as a Shareholder in respect of the Share or, instead of being registered himself, to make such transfer of the Share as the deceased or bankrupt Person could have made; but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the Share by the deceased or bankrupt Person before the death or bankruptcy.

51.A Person becoming entitled to a Share by reason of the death or bankruptcy of a Shareholder shall be entitled to the same dividends and other advantages to which he would be entitled if he were the registered Shareholder, except that he shall not, before being registered as a Shareholder in respect of the Share, be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company, provided however, that the Directors may at any time give notice requiring any such person to elect either to be registered himself or to transfer the Share, and if the notice is not complied with within ninety (90) days, the Directors may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the Share until the requirements of the notice have been complied with.

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REGISTRATION OF EMPOWERING INSTRUMENTS

52.The Company shall be entitled to charge a fee not exceeding one dollar (US$1.00) on the registration of every probate, letters of administration, certificate of death or marriage, power of attorney, notice in lieu of distringas, or other instrument.

ALTERATION OF SHARE CAPITAL

53.The Company may from time to time by Ordinary Resolution increase the share capital by such sum, to be divided into Shares of such Classes and amount, as the resolution shall prescribe.

54.The Company may by Ordinary Resolution:

(a)consolidate and divide all or any of its share capital into Shares of a larger amount than its existing Shares;

(b)convert all or any of its paid up Shares into stock and reconvert that stock into paid up Shares of any denomination;

(c)subdivide its existing Shares, or any of them into Shares of a smaller amount provided that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced Share shall be the same as it was in case of the Share from which the reduced Share is derived; and

(d)cancel any Shares that, at the date of the passing of the resolution, have not been taken or agreed to be taken by any Person and diminish the amount of its share capital by the amount of the Shares so cancelled.

55.The Company may by Special Resolution reduce its share capital and any capital redemption reserve in any manner authorised by law.

REDEMPTION, PURCHASE AND SURRENDER OF SHARES

56.Subject to the provisions of the Companies Law and these Articles, the Company may:

(a)issue Shares that are to be redeemed or are liable to be redeemed at the option of the Shareholder or the Company, provided that the redemption of Shares shall be effected in such manner and upon such terms as may be determined by the Board before the issue of such Shares;

(b)purchase its own Shares (including any redeemable Shares) in such manner and upon such terms as have been approved by the Board or by the Members by Ordinary Resolution, or are otherwise authorised by these Articles; and

(c)make a payment in respect of the redemption or purchase of its own Shares in any manner permitted by the Companies Law, including out of capital.

57.The purchase of any Share shall not oblige the Company to purchase any other Share other than as may be required pursuant to applicable law and any other contractual obligations of the Company.

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58.The holder of the Shares being purchased shall be bound to deliver up to the Company the certificate(s) (if any) thereof for cancellation and thereupon the Company shall pay to him the purchase or redemption monies or consideration in respect thereof.

59.The Directors may accept the surrender for no consideration of any fully paid Share.

TREASURY SHARES

60.The Directors may, prior to the purchase, redemption or surrender of any Share, determine that such Share shall be held as a Treasury Share.

61.The Directors may determine to cancel a Treasury Share or transfer a Treasury Share on such terms as they think proper (including, without limitation, for nil consideration).

GENERAL MEETINGS

62.All general meetings other than annual general meetings shall be called extraordinary general meetings.

63.(a)The Company may, but shall not be obligated to (unless required by the Companies Law or other applicable laws and regulations), in each year hold a general meeting as its annual general meeting and shall specify the meeting as such in the notices calling it.  The annual general meeting shall be held at such time and place as may be determined by the Directors.

(b)At these meetings, the report of the Directors (if any) shall be presented.

64.(a)The Directors (acting by a resolution of the Board) or the Chairman may call general meetings.  In addition, the Directors shall, on a Shareholders’ requisition, forthwith proceed to convene an extraordinary general meeting of the Company.

(b)A Shareholders’ requisition is a requisition of one or more Members holding, at the date of deposit of the requisition, Shares which represent, in aggregate, not less than one-third (1/3) of the votes attaching to all issued and outstanding Shares which, as at that date of the deposit, carry the right to vote at general meetings of the Company.

(c)The requisition must state the objects of the meeting and must be signed by the requisitionists and deposited at the Registered Office, and may consist of several documents in like form each signed by one or more requisitionists.

(d)If the Directors do not within twenty-one (21) days from the date of the deposit of the requisition duly proceed to convene a general meeting to be held within a further twenty-one (21) days, the requisitionists, or any of them representing more than one-half (1/2) of the total voting rights of all of them, may themselves convene a general meeting, but any meeting so convened shall not be held after the expiration of three (3) months after the expiration of the said twenty-one (21) days.

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(e)A general meeting convened as aforesaid by requisitionists shall be convened in the same manner as nearly as possible as that in which general meetings are to be convened by Directors.

NOTICE OF GENERAL MEETINGS

65.At least fourteen (14) days’ notice shall be given for any general meeting.  Every notice shall be exclusive of the day on which it is given or deemed to be given and of the day for which it is given and shall specify the place, the day and the hour of the meeting and the general nature of the business and shall be given in the manner hereinafter mentioned or in such other manner if any as may be prescribed by the Company, provided that a general meeting of the Company shall, whether or not the notice specified in this Article has been given and whether or not the provisions of these Articles regarding general meetings have been complied with, be deemed to have been duly convened if it is so agreed:

(a)in the case of an annual general meeting by all the Shareholders (or their proxies) entitled to attend and vote thereat; and

(b)in the case of an extraordinary general meeting by a majority in number of the Shareholders (or their proxies) having a right to attend and vote at the meeting, being a majority together holding not less than ninety five percent (95%) in par value of the Shares giving that right.

66.The accidental omission to give notice of a meeting to or the non-receipt of a notice of a meeting by any Shareholder shall not invalidate the proceedings at any meeting.

PROCEEDINGS AT GENERAL MEETINGS

67.No business except for the appointment of a chairman for the meeting shall be transacted at any general meeting unless a quorum of Members is present at the time when the meeting proceeds to business.  One or more Members holding shares which represent, in aggregate, not less than fifty percent (50%) of the votes attaching to all issued and outstanding Shares and entitled to vote, present in person or by proxy or, if a corporation or other non-natural person, by its duly authorised representative, shall be a quorum for all purposes.

68.If within half an hour from the time appointed for the meeting a quorum is not present, the meeting shall be dissolved.

69.Participation in any general meeting of the Company may be by means of a telephone or similar communication equipment by way of which all Persons participating in such meeting can communicate with each other and such participation shall be deemed to constitute presence in person at the meeting.

70.The Chairman, if any, of the Directors shall preside as chairman at every general meeting of the Company.

71.If there is no such chairman, or if at any general meeting he is not present within fifteen (15) minutes after the time appointed for holding the meeting or is unwilling to act as chairman, any Director or Person nominated by the Directors shall preside as

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chairman of that meeting, failing which the Shareholders present in person or by proxy shall choose any Person present to be chairman of that meeting.

72.The chairman may with the consent of any general meeting at which a quorum is present (and shall if so directed by the meeting) adjourn a meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.  When a meeting, or adjourned meeting, is adjourned for fourteen (14) days or more, notice of the adjourned meeting shall be given as in the case of an original meeting.  Save as aforesaid it shall not be necessary to give any notice of an adjournment or of the business to be transacted at an adjourned meeting.

73.The Directors may cancel or postpone any duly convened general meeting at any time prior to such meeting, except for general meetings requisitioned by the Shareholders in accordance with these Articles, for any reason or for no reason, upon notice in writing to Shareholders.  A postponement may be for a stated period of any length or indefinitely as the Directors may determine.

74.At any general meeting, a resolution put to the vote of the meeting shall be decided on a show of hands, unless a poll is (before or on the declaration of the result of the show of hands) demanded by the chairman or any Shareholder holding at least ten percent (10%) of the Shares given a right to vote at the meeting, present in person or by proxy, and unless a poll is so demanded, a declaration by the chairman that a resolution has, on a show of hands, been carried, or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the book of the proceedings of the Company, shall be conclusive evidence of the fact, without proof of the number or proportion of the votes recorded in favour of, or against, that resolution.

75.If a poll is duly demanded, it shall be taken in such manner as the chairman directs, and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.

76.All questions submitted to a meeting shall be decided by a simple majority of votes except where a greater majority is required by these Articles or by the Law.  In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes place or at which the poll is demanded, shall be entitled to a second or casting vote.

77.A poll demanded on the election of a chairman of the meeting or on a question of adjournment shall be taken forthwith.  A poll demanded on any other question shall be taken at such time as the chairman of the meeting directs.

VOTES OF SHAREHOLDERS

78.Subject to Article 12, and to any rights and restrictions for the time being attached to any Share, on a show of hands every Shareholder present in person and every Person representing a Shareholder by proxy shall, at a general meeting of the Company, each have one (1) vote, and on a poll every Shareholder and every Person representing a Shareholder by proxy shall have one (1) vote for each Class B Ordinary Share and ten (10) votes for each Class A Ordinary Share of which he or the Person represented by proxy is the holder.

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79.In the case of joint holders the vote of the senior who tenders a vote whether in person or by proxy shall be accepted to the exclusion of the votes of the other joint holders and for this purpose seniority shall be determined by the order in which the names stand in the Register.

80.A Shareholder of unsound mind, or in respect of whom an order has been made by any court having jurisdiction in lunacy, may vote in respect of Shares carrying the right to vote held by him, whether on a show of hands or on a poll, by his committee, or other Person in the nature of a committee appointed by that court, and any such committee or other Person, may vote in respect of such Shares by proxy.

81.No Shareholder shall be entitled to vote at any general meeting of the Company unless all calls, if any, or other sums presently payable by him in respect of Shares carrying the right to vote held by him have been paid.

82.On a poll votes may be given either personally or by proxy.

83.Each Shareholder, other than a recognised clearing house (or its nominee(s)) or depositary (or its nominee(s)), may only appoint one proxy on a show of hand.  The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under Seal or under the hand of an officer or attorney duly authorised.  A proxy need not be a Shareholder.

84.An instrument appointing a proxy may be in any usual or common form or such other form as the Directors may approve.

85.The instrument appointing a proxy and (if required by the Board) the power of attorney or other authority (if any) under which it is signed, or a certified copy of such power or authority, shall be delivered to such place or one of such places (if any) as may be specified for that purpose in or by way of note to or in any document accompanying the notice convening the meeting (or, if no place is so specified, at the Registered Office), not less than forty-eight (48) hours before the time appointed for holding the meeting or adjourned meeting at which the person named in the instrument proposes to vote or, in the case of a poll taken subsequently to the date of a meeting or adjourned meeting, not less than twenty-four (24) hours before the time appointed for the taking of the poll; and in default the instrument of proxy shall not be treated as valid.  No instrument appointing a proxy shall be valid after the expiration of twelve (12) months from the date named in it as the date of its execution, except at an adjourned meeting or on a poll demanded at a meeting or an adjourned meeting in cases where the meeting was originally held within twelve (12) months from such date.  Delivery of an instrument appointing a proxy shall not preclude a Member from attending and voting in person at the meeting convened and in such event, the instrument appointing a proxy shall be deemed to be revoked.

86.The instrument appointing a proxy shall be deemed to confer authority to demand or join in demanding a poll.

87.A resolution in writing signed by all the Shareholders for the time being entitled to receive notice of and to attend and vote at general meetings of the Company (or being corporations by their duly authorised representatives) shall be as valid and effective as

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if the same had been passed at a general meeting of the Company duly convened and held.

CORPORATIONS ACTING BY REPRESENTATIVES AT MEETINGS

88.Any corporation which is a Shareholder or a Director may by resolution of its directors or other governing body authorise such Person as it thinks fit to act as its representative at any meeting of the Company or of any meeting of holders of a Class or of the Directors or of a committee of Directors, and the Person so authorised shall be entitled to exercise the same powers on behalf of the corporation which he represents as that corporation could exercise if it were an individual Shareholder or Director.

DEPOSITARY AND CLEARING HOUSES

89.If a recognised clearing house (or its nominee(s)) or depositary (or its nominee(s)) is a Member of the Company it may, by resolution of its directors or other governing body or by power of attorney, authorise such Person(s) as it thinks fit to act as its representative(s) at any general meeting of the Company or of any Class of Shareholders of the Company provided that, if more than one Person is so authorised, the authorisation shall specify the number and Class of Shares in respect of which each such Person is so authorised.  A Person so authorised pursuant to this Article shall be entitled to exercise the same powers on behalf of the recognised clearing house (or its nominee(s)) or depositary (or its nominee(s)) which he represents as that recognised clearing house (or its nominee(s)) or depositary (or its nominee(s)) could exercise if it were an individual Member holding the number and Class of Shares specified in such authorisation, including the right to vote individually on a show of hands.

DIRECTORS

90.(a)Unless otherwise determined by the Company in a general meeting, the number of Directors shall not be less than two (2), and there shall be no maximum number of Directors with the size of the Board to be determined from time to time by a majority of the Directors.  For so long as Shares or ADSs are listed on the Designated Stock Exchange, the Directors shall include such number of Independent Directors as applicable law, rules or regulations or the Designated Stock Exchange Rules require, unless the Board resolves to follow any available exceptions or exemptions.

(b)Each Director shall hold office until the expiration of his term as provided in the written agreement relating to the Director’s term, if any, and until his successor shall have been elected or appointed.

(c)The Board of Directors shall have a Chairman elected and appointed by a majority of the Directors then in office.  The period for which the Chairman will hold office will also be determined by a majority of all of the Directors then in office.  The Chairman shall preside as chairman at every meeting of the Board of Directors.  To the extent the Chairman is not present at a meeting of the Board of Directors within fifteen (15) minutes after the time appointed for

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holding the same, the attending Directors may choose one of their number to be the chairman of the meeting.

(d)The Company may by Ordinary Resolution appoint any person to be a Director either to fill a casual vacancy or as an addition to the existing Board.

(e)The Board, by the affirmative vote of a simple majority of the remaining Directors present and voting at a Board meeting, may at any time and from time to time appoint any person to be a Director to fill a casual vacancy arising from the resignation of a former Director or as an addition to the existing Board, subject to the Company’s compliance with director nomination procedures required under the Designated Stock Exchange Rules as long as Shares or ADSs are listed on the Designated Stock Exchange, unless the Board resolves to follow any available exceptions or exemptions.

91.A Director may be removed from office by Special Resolution, notwithstanding anything in these Articles or in any agreement between the Company and such Director (but without prejudice to any claim for damages under such agreement).  A vacancy on the Board created by the removal of a Director under the previous sentence or the increase of the size of the Board may be filled by the election or appointment by Ordinary Resolution or in a manner set forth in Article 90(e).

92.The Board may, from time to time, and except as required by applicable law or the listing rules of the Designated Stock Exchange, adopt, institute, amend, modify or revoke the corporate governance policies or initiatives, which shall be intended to set forth the policies of the Company and the Board on various corporate governance related matters as the Board shall determine by resolution from time to time.

93.A Director shall not be required to hold any Shares in the Company by way of qualification.  A Director who is not a Member of the Company shall nevertheless be entitled to attend and speak at general meetings.

94.The remuneration of the Directors may be determined by the Directors or by Ordinary Resolution.

95.The Directors shall be entitled to be paid their travelling, hotel and other expenses properly incurred by them in going to, attending and returning from meetings of the Directors, or any committee of the Directors, or general meetings of the Company, or otherwise in connection with the business of the Company, or to receive such fixed allowance in respect thereof as may be determined by the Directors from time to time, or a combination partly of one such method and partly the other.

ALTERNATE DIRECTOR OR PROXY

96.Any Director may in writing appoint another Person to be his alternate and, save to the extent provided otherwise in the form of appointment, such alternate shall have authority to sign written resolutions on behalf of the appointing Director, but shall not be required to sign such written resolutions where they have been signed by the appointing director, and to act in such Director’s place at any meeting of the Directors at which the appointing Director is unable to be present.  Every such alternate shall be entitled to attend and vote at meetings of the Directors as a Director when the Director

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appointing him is not personally present and where he is a Director to have a separate vote on behalf of the Director he is representing in addition to his own vote.  A Director may at any time in writing revoke the appointment of an alternate appointed by him.  Such alternate shall be deemed for all purposes to be a Director of the Company and shall not be deemed to be the agent of the Director appointing him.  The remuneration of such alternate shall be payable out of the remuneration of the Director appointing him and the proportion thereof shall be agreed between them.

97.Any Director may appoint any Person, whether or not a Director, to be the proxy of that Director to attend and vote on his behalf, in accordance with instructions given by that Director, or in the absence of such instructions at the discretion of the proxy, at a meeting or meetings of the Directors which that Director is unable to attend personally.  The instrument appointing the proxy shall be in writing under the hand of the appointing Director and shall be in any usual or common form or such other form as the Directors may approve, and must be lodged with the chairman of the meeting of the Directors at which such proxy is to be used, or first used, prior to the commencement of the meeting.

POWERS AND DUTIES OF DIRECTORS

98.Subject to the Companies Law, these Articles and to any resolutions passed in a general meeting, the business of the Company shall be managed by the Directors, who may pay all expenses incurred in setting up and registering the Company and may exercise all powers of the Company.  No resolution passed by the Company in general meeting shall invalidate any prior act of the Directors that would have been valid if that resolution had not been passed.

99.Subject to these Articles, the Directors may from time to time appoint any natural person or corporation, whether or not a Director to hold such office in the Company as the Directors may think necessary for the administration of the Company, including but not limited to, the office of chief executive officer, one or more other executive officers, vice-presidents, treasurer, assistant treasurer, manager or controller, and for such term and at such remuneration (whether by way of salary or commission or participation in profits or partly in one way and partly in another), and with such powers and duties as the Directors may think fit.  Any natural person or corporation so appointed by the Directors may be removed by the Directors.  The Directors may also appoint one or more of their number to the office of managing director upon like terms, but any such appointment shall ipso facto terminate if any managing director ceases for any cause to be a Director, or if the Company by Ordinary Resolution resolves that his tenure of office be terminated.

100.The Directors may appoint any natural person or corporation to be a Secretary (and if need be an assistant Secretary or assistant Secretaries) who shall hold office for such term, at such remuneration and upon such conditions and with such powers as they think fit.  Any Secretary or assistant Secretary so appointed by the Directors may be removed by the Directors or by the Company by Ordinary Resolution.

101.The Directors may delegate any of their powers to committees consisting of such member or members of their body as they think fit; any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on it by the Directors.

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102.The Directors may from time to time and at any time by power of attorney (whether under Seal or under hand) or otherwise appoint any company, firm or Person or body of Persons, whether nominated directly or indirectly by the Directors, to be the attorney or attorneys or authorised signatory (any such person being an “Attorney” or “Authorised Signatory”, respectively) of the Company for such purposes and with such powers, authorities and discretion (not exceeding those vested in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit, and any such power of attorney or other appointment may contain such provisions for the protection and convenience of Persons dealing with any such Attorney or Authorised Signatory as the Directors may think fit, and may also authorise any such Attorney or Authorised Signatory to delegate all or any of the powers, authorities and discretion vested in him.

103.The Directors may from time to time provide for the management of the affairs of the Company in such manner as they shall think fit and the provisions contained in the three next following Articles shall not limit the general powers conferred by this Article.

104.The Directors from time to time and at any time may establish any committees, local boards or agencies for managing any of the affairs of the Company and may appoint any natural person or corporation to be a member of such committees or local boards and may appoint any managers or agents of the Company and may fix the remuneration of any such natural person or corporation.

105.Without prejudice to the freedom of the Directors to establish any other committees, for so long as the shares of the Company (or its ADSs) are listed or quoted on the Designated Stock Exchange, the Board shall establish and maintain an Audit Committee as a committee of the Board, the composition and responsibilities of which shall comply with the rules and regulations of the Designated Stock Exchange and the Commission.  The Board shall adopt a formal written audit committee charter, and the audit committee shall review and assess the adequacy of the formal written charter on an annual basis.

106.Without prejudice to the freedom of the Directors to establish any other committees, the Board may establish and maintain a Compensation Committee to assist the Board in reviewing and approving the compensation structure for the Company’s Directors and executive officers.  For as long as the shares of the Company (or depositary receipts thereof) are listed or quoted on the Designated Stock Exchange, the composition, responsibilities and proceedings of the Compensation Committee shall comply with the rules and regulations of the Designated Stock Exchange and the Commission.

107.The Directors from time to time and at any time may delegate to any such committee, local board, manager or agent any of the powers, authorities and discretions for the time being vested in the Directors and may authorise the members for the time being of any such local board, or any of them to fill any vacancies therein and to act notwithstanding vacancies and any such appointment or delegation may be made on such terms and subject to such conditions as the Directors may think fit and the Directors may at any time remove any natural person or corporation so appointed and may annul or vary any such delegation, but no Person dealing in good faith and without notice of any such annulment or variation shall be affected thereby.

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108.Any such delegates as aforesaid may be authorised by the Directors to sub-delegate all or any of the powers, authorities, and discretion for the time being vested in them.

BORROWING POWERS OF DIRECTORS

109.The Directors may from time to time at their discretion exercise all the powers of the Company to raise or borrow money and to mortgage or charge its undertaking, property and assets (present and future) and uncalled capital or any part thereof, to issue debentures, debenture stock, bonds and other securities, whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

THE SEAL

110.The Seal shall not be affixed to any instrument except by the authority of a resolution of the Directors provided always that such authority may be given prior to or after the affixing of the Seal and if given after may be in general form confirming a number of affixings of the Seal.  The Seal shall be affixed in the presence of a Director or a Secretary (or an assistant Secretary) or in the presence of any one or more Persons as the Directors may appoint for the purpose and every Person as aforesaid shall sign every instrument to which the Seal is so affixed in their presence.

111.The Company may maintain a facsimile of the Seal in such countries or places as the Directors may appoint and such facsimile Seal shall not be affixed to any instrument except by the authority of a resolution of the Directors provided always that such authority may be given prior to or after the affixing of such facsimile Seal and if given after may be in general form confirming a number of affixings of such facsimile Seal.  The facsimile Seal shall be affixed in the presence of such Person or Persons as the Directors shall for this purpose appoint and such Person or Persons as aforesaid shall sign every instrument to which the facsimile Seal is so affixed in their presence and such affixing of the facsimile Seal and signing as aforesaid shall have the same meaning and effect as if the Seal had been affixed in the presence of and the instrument signed by a Director or a Secretary (or an assistant Secretary) or in the presence of any one or more Persons as the Directors may appoint for the purpose.

112.Notwithstanding the foregoing, a Secretary or any assistant Secretary shall have the authority to affix the Seal, or the facsimile Seal, to any instrument for the purposes of attesting authenticity of the matter contained therein but which does not create any obligation binding on the Company.

DISQUALIFICATION OF DIRECTORS

113.The office of Director shall be vacated, if the Director:

(a)becomes bankrupt or makes any arrangement or composition with his creditors;

(b)dies or is found to be or becomes of unsound mind;

(c)resigns his office by notice in writing to the Company;

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(d)without special leave of absence from the Board, is absent from meetings of the Board for three consecutive meetings and the Board resolves that his office be vacated; or

(e)is removed from office pursuant to any other provision of these Articles.

PROCEEDINGS OF DIRECTORS

114.The Directors may meet together (either within or without the Cayman Islands) for the despatch of business, adjourn, and otherwise regulate their meetings and proceedings as they think fit.  Questions arising at any meeting shall be decided by a majority of votes.  At any meeting of the Directors, each Director present in person or represented by his proxy or alternate shall be entitled to one vote.  In case of an equality of votes the Chairman shall have a second or casting vote.  A Director may, and a Secretary or assistant Secretary on the requisition of a Director shall, at any time summon a meeting of the Directors.

115.A Director may participate in any meeting of the Directors, or of any committee appointed by the Directors of which such Director is a member, by means of telephone or similar communication equipment by way of which all Persons participating in such meeting can communicate with each other and such participation shall be deemed to constitute presence in person at the meeting.

116.The quorum necessary for the transaction of the business of the Board shall be a majority of the then existing Directors.  A Director represented by proxy or by an alternate Director at any meeting shall be deemed to be present for the purposes of determining whether or not a quorum is present.

117.A Director who is in any way, whether directly or indirectly, interested in a contract or transaction or proposed contract or transaction with the Company shall declare the nature of his interest at a meeting of the Directors.  A general notice given to the Directors by any Director to the effect that he is a member of any specified company or firm and is to be regarded as interested in any contract or transaction which may thereafter be made with that company or firm shall be deemed a sufficient declaration of interest in regard to any contract so made or transaction so consummated.  Subject to the Designated Stock Exchange Rules and disqualification by the Chairman of the relevant Board meeting, a Director may vote in respect of any contract or transaction or proposed contract or transaction notwithstanding that he may be interested therein and if he does so his vote shall be counted and he may be counted in the quorum at any meeting of the Directors at which any such contract or transaction or proposed contract or transaction shall come before the meeting for consideration.

118.A Director may hold any other office or place of profit under the Company (other than the office of auditor) in conjunction with his office of Director for such period and on such terms (as to remuneration and otherwise) as the Directors may determine and no Director or intending Director shall be disqualified by his office from contracting with the Company either with regard to his tenure of any such other office or place of profit or as vendor, purchaser or otherwise, nor shall any such contract or arrangement entered into by or on behalf of the Company in which any Director is in any way interested, be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any

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such contract or arrangement by reason of such Director holding that office or of the fiduciary relation thereby established.  A Director, notwithstanding his interest, may be counted in the quorum present at any meeting of the Directors whereat he or any other Director is appointed to hold any such office or place of profit under the Company or whereat the terms of any such appointment are arranged and he may vote on any such appointment or arrangement.

119.Any Director may act by himself or through his firm in a professional capacity for the Company, and he or his firm shall be entitled to remuneration for professional services as if he were not a Director; provided that nothing herein contained shall authorise a Director or his firm to act as auditor to the Company.

120.The Directors shall cause minutes to be made for the purpose of recording:

(a)all appointments of officers made by the Directors;

(b)the names of the Directors present at each meeting of the Directors and of any committee of the Directors; and

(c)all resolutions and proceedings at all meetings of the Company, and of the Directors and of committees of Directors.

121.When the Chairman of a meeting of the Directors signs the minutes of such meeting the same shall be deemed to have been duly held notwithstanding that all the Directors have not actually come together or that there may have been a technical defect in the proceedings.

122.A resolution in writing signed by all the Directors or all the members of a committee of Directors entitled to receive notice of a meeting of Directors or committee of Directors, as the case may be (an alternate Director, subject as provided otherwise in the terms of appointment of the alternate Director, being entitled to sign such a resolution on behalf of his appointer), shall be as valid and effectual as if it had been passed at a duly called and constituted meeting of Directors or committee of Directors, as the case may be.  When signed a resolution may consist of several documents each signed by one or more of the Directors or his duly appointed alternate.

123.The continuing Directors may act notwithstanding any vacancy in their body but if and for so long as their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum of Directors, the continuing Directors may act for the purpose of increasing the number, or of summoning a general meeting of the Company, but for no other purpose.

124.Subject to any regulations imposed on it by the Directors, a committee appointed by the Directors may elect a chairman of its meetings.  If no such chairman is elected, or if at any meeting the chairman is not present within fifteen (15) minutes after the time appointed for holding the meeting, the committee members present may choose one of their number to be chairman of the meeting.

125.A committee appointed by the Directors may meet and adjourn as it thinks proper.  Subject to any regulations imposed on it by the Directors, questions arising at any

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meeting shall be determined by a majority of votes of the committee members present and in case of an equality of votes the chairman shall have a second or casting vote.

126.All acts done by any meeting of the Directors or of a committee of Directors, or by any Person acting as a Director, shall notwithstanding that it be afterwards discovered that there was some defect in the appointment of any such Director or Person acting as aforesaid, or that they or any of them were disqualified, be as valid as if every such Person had been duly appointed and was qualified to be a Director.

PRESUMPTION OF ASSENT

127.A Director of the Company who is present at a meeting of the Board of Directors at which an action on any Company matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent from such action with the person acting as the chairman or secretary of the meeting before the adjournment thereof or shall forward such dissent by registered post to such person immediately after the adjournment of the meeting.  Such right to dissent shall not apply to a Director who voted in favour of such action.

DIVIDENDS

128.Subject to any rights and restrictions for the time being attached to any Shares, the Directors may from time to time declare dividends (including interim dividends) and other distributions on Shares in issue and authorise payment of the same out of the funds of the Company lawfully available therefor.

129.Subject to any rights and restrictions for the time being attached to any Shares, the Company by Ordinary Resolution may declare dividends, but no dividend shall exceed the amount recommended by the Directors.

130.The Directors may, before recommending or declaring any dividend, set aside out of the funds legally available for distribution such sums as they think proper as a reserve or reserves which shall, in the absolute discretion of the Directors be applicable for meeting contingencies, or for equalising dividends or for any other purpose to which those funds may be properly applied and pending such application may in the absolute discretion of the Directors, either be employed in the business of the Company or be invested in such investments (other than Shares of the Company) as the Directors may from time to time think fit.

131.Any dividend payable in cash to the holder of Shares may be paid in any manner determined by the Directors.  If paid by cheque it will be sent by mail addressed to the holder at his address in the Register, or addressed to such person and at such addresses as the holder may direct.  Every such cheque or warrant shall, unless the holder or joint holders otherwise direct, be made payable to the order of the holder or, in the case of joint holders, to the order of the holder whose name stands first on the Register in respect of such Shares, and shall be sent at his or their risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to the Company.

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132.The Directors may determine that a dividend shall be paid wholly or partly by the distribution of specific assets (which may consist of the shares or securities of any other company) and may settle all questions concerning such distribution.  Without limiting the generality of the foregoing, the Directors may fix the value of such specific assets, may determine that cash payment shall be made to some Shareholders in lieu of specific assets and may vest any such specific assets in trustees on such terms as the Directors think fit.

133.Subject to any rights and restrictions for the time being attached to any Shares, all dividends shall be declared and paid according to the amounts paid up on the Shares, but if and for so long as nothing is paid up on any of the Shares dividends may be declared and paid according to the par value of the Shares.  No amount paid on a Share in advance of calls shall, while carrying interest, be treated for the purposes of this Article as paid on the Share.

134.If several Persons are registered as joint holders of any Share, any of them may give effective receipts for any dividend or other moneys payable on or in respect of the Share.

135.No dividend shall bear interest against the Company.

136.Any dividend unclaimed after a period of six years from the date of declaration of such dividend may be forfeited by the Board of Directors and, if so forfeited, shall revert to the Company.

ACCOUNTS, AUDIT AND ANNUAL RETURN AND DECLARATION

137.The books of account relating to the Company’s affairs shall be kept in such manner as may be determined from time to time by the Directors.

138.The books of account shall be kept at the Registered Office, or at such other place or places as the Directors think fit, and shall always be open to the inspection of the Directors.

139.The Directors may from time to time determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of Shareholders not being Directors, and no Shareholder (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by law or authorised by the Directors or by Ordinary Resolution.

140.The accounts relating to the Company’s affairs shall be audited in such manner and with such financial year end as may be determined from time to time by the Directors or failing any determination as aforesaid shall not be audited.

141.The Directors may appoint an auditor of the Company who shall hold office until removed from office by a resolution of the Directors and may fix his or their remuneration.

142.Every auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the

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Directors and officers of the Company such information and explanation as may be necessary for the performance of the duties of the auditors.

143.The auditors shall, if so required by the Directors, make a report on the accounts of the Company during their tenure of office at the next annual general meeting following their appointment, and at any time during their term of office, upon request of the Directors or any general meeting of the Members.

144.The Directors in each year shall prepare, or cause to be prepared, an annual return and declaration setting forth the particulars required by the Companies Law and deliver a copy thereof to the Registrar of Companies in the Cayman Islands.

CAPITALISATION OF RESERVES

145.Subject to the Companies Law, the Directors may, with the authority of an Ordinary Resolution:

(a)resolve to capitalise an amount standing to the credit of reserves (including a Share Premium Account, capital redemption reserve and profit and loss account), whether or not available for distribution;

(b)appropriate the sum resolved to be capitalised to the Shareholders in proportion to the nominal amount of Shares (whether or not fully paid) held by them respectively and apply that sum on their behalf in or towards:

(i)paying up the amounts (if any) for the time being unpaid on Shares held by them respectively, or

(ii)paying up in full unissued Shares or debentures of a nominal amount equal to that sum,

and allot the Shares or debentures, credited as fully paid, to the Shareholders (or as they may direct) in those proportions, or partly in one way and partly in the other, but the Share Premium Account, the capital redemption reserve and profits which are not available for distribution may, for the purposes of this Article, only be applied in paying up unissued Shares to be allotted to Shareholders credited as fully paid;

(c)make any arrangements they think fit to resolve a difficulty arising in the distribution of a capitalised reserve and in particular, without limitation, where Shares or debentures become distributable in fractions the Directors may deal with the fractions as they think fit;

(d)authorise a Person to enter (on behalf of all the Shareholders concerned) into an agreement with the Company providing for either:

(i)the allotment to the Shareholders respectively, credited as fully paid, of Shares or debentures to which they may be entitled on the capitalisation, or

(ii)the payment by the Company on behalf of the Shareholders (by the application of their respective proportions of the reserves resolved to be

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capitalised) of the amounts or part of the amounts remaining unpaid on their existing Shares,

and any such agreement made under this authority being effective and binding on all those Shareholders; and

(e)generally do all acts and things required to give effect to the resolution.

SHARE PREMIUM ACCOUNT

146.The Directors shall in accordance with the Companies Law establish a Share Premium Account and shall carry to the credit of such account from time to time a sum equal to the amount or value of the premium paid on the issue of any Share.

147.There shall be debited to any Share Premium Account on the redemption or purchase of a Share the difference between the nominal value of such Share and the redemption or purchase price provided always that at the discretion of the Directors such sum may be paid out of the profits of the Company or, if permitted by the Companies Law, out of capital.

NOTICES

148.Except as otherwise provided in these Articles, any notice or document may be served by the Company or by the Person entitled to give notice to any Shareholder either personally, or by posting it by airmail or air courier service in a prepaid letter addressed to such Shareholder at his address as appearing in the Register, or by electronic mail to any electronic mail address such Shareholder may have specified in writing for the purpose of such service of notices, or by facsimile or by placing it on the Company’s Website should the Directors deem it appropriate.  In the case of joint holders of a Share, all notices shall be given to that one of the joint holders whose name stands first in the Register in respect of the joint holding, and notice so given shall be sufficient notice to all the joint holders.

149.Notices posted to addresses outside the Cayman Islands shall be forwarded by prepaid airmail.

150.Any Shareholder present, either personally or by proxy, at any meeting of the Company shall for all purposes be deemed to have received due notice of such meeting and, where requisite, of the purposes for which such meeting was convened.

151.Any notice or other document, if served by:

(a)post, shall be deemed to have been served five (5) days after the time when the letter containing the same is posted;

(b)facsimile, shall be deemed to have been served upon production by the transmitting facsimile machine of a report confirming transmission of the facsimile in full to the facsimile number of the recipient;

(c)recognized courier service, shall be deemed to have been served 48 hours after the time when the letter containing the same is delivered to the courier service; or

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(d)electronic mail, shall be deemed to have been served immediately upon the time of the transmission by electronic mail.

In proving service by post or courier service it shall be sufficient to prove that the letter containing the notice or documents was properly addressed and duly posted or delivered to the courier service.

152.Any notice or document delivered or sent by post to or left at the registered address of any Shareholder in accordance with the terms of these Articles shall notwithstanding that such Shareholder be then dead or bankrupt, and whether or not the Company has notice of his death or bankruptcy, be deemed to have been duly served in respect of any Share registered in the name of such Shareholder as sole or joint holder, unless his name shall at the time of the service of the notice or document, have been removed from the Register as the holder of the Share, and such service shall for all purposes be deemed a sufficient service of such notice or document on all Persons interested (whether jointly with or as claiming through or under him) in the Share.

153.Notice of every general meeting of the Company shall be given to:

(a)all Shareholders holding Shares with the right to receive notice and who have supplied to the Company an address for the giving of notices to them; and

(b)every Person entitled to a Share in consequence of the death or bankruptcy of a Shareholder, who but for his death or bankruptcy would be entitled to receive notice of the meeting.

No other Person shall be entitled to receive notices of general meetings.

INFORMATION

154.No Member shall be entitled to require discovery of any information in respect of any detail of the Company’s trading or any information which is or may be in the nature of a trade secret or secret process which may relate to the conduct of the business of the Company and which in the opinion of the Board would not be in the interests of the Members of the Company to communicate to the public.

155.The Board shall be entitled to release or disclose any information in its possession, custody or control regarding the Company or its affairs to any of its Members including, without limitation, information contained in the Register and transfer books of the Company.

INDEMNITY

156.Every Director (including for the purposes of this Article any alternate Director appointed pursuant to the provisions of these Articles), Secretary, assistant Secretary, or other officer for the time being and from time to time of the Company (but not including the Company’s auditors) and the personal representatives of the same (each an “Indemnified Person”) shall be indemnified and secured harmless against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by such Indemnified Person, other than by reason of such Indemnified Person’s own dishonesty, wilful default or fraud, in or about the conduct of the Company’s business or affairs (including as a result of any mistake of judgment) or in

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the execution or discharge of his duties, powers, authorities or discretions, including without prejudice to the generality of the foregoing, any costs, expenses, losses or liabilities incurred by such Indemnified Person in defending (whether successfully or otherwise) any civil proceedings concerning the Company or its affairs in any court whether in the Cayman Islands or elsewhere.

157.No Indemnified Person shall be liable:

(a)for the acts, receipts, neglects, defaults or omissions of any other Director or officer or agent of the Company; or

(b)for any loss on account of defect of title to any property of the Company; or

(c)on account of the insufficiency of any security in or upon which any money of the Company shall be invested; or

(d)for any loss incurred through any bank, broker or other similar Person; or

(e)for any loss occasioned by any negligence, default, breach of duty, breach of trust, error of judgement or oversight on such Indemnified Person’s part; or

(f)for any loss, damage or misfortune whatsoever which may happen in or arise from the execution or discharge of the duties, powers, authorities, or discretions of such Indemnified Person’s office or in relation thereto;

unless the same shall happen through such Indemnified Person’s own dishonesty, willful default or fraud.

FINANCIAL YEAR

158.Unless the Directors otherwise prescribe, the financial year of the Company shall end on December 31st in each year and shall begin on January 1st in each year.

NON-RECOGNITION OF TRUSTS

159.No Person shall be recognised by the Company as holding any Share upon any trust and the Company shall not, unless required by law, be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or partial interest in any Share or (except only as otherwise provided by these Articles or as the Companies Law requires) any other right in respect of any Share except an absolute right to the entirety thereof in each Shareholder registered in the Register.

WINDING UP

160.If the Company shall be wound up the liquidator may, with the sanction of a Special Resolution of the Company and any other sanction required by the Companies Law, subject to these Articles, divide amongst the Members in species or in kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not) and may for that purpose value any assets and determine how the division shall be carried out as between the Members or different classes of Members. The liquidator may, with the like sanction, vest the whole or any part of such assets in

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trustees upon such trusts for the benefit of the Members as the liquidator, with the like sanction, shall think fit, but so that no Member shall be compelled to accept any asset upon which there is a liability.

161.If the Company shall be wound up, and the assets available for distribution amongst the Members shall be insufficient to repay the whole of the share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the Members in proportion to the par value of the Shares held by them.  If in a winding up the assets available for distribution amongst the Members shall be more than sufficient to repay the whole of the share capital at the commencement of the winding up, the surplus shall be distributed amongst the Members in proportion to the par value of the Shares held by them at the commencement of the winding up subject to a deduction from those Shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise.  This Article is without prejudice to the rights of the holders of Shares issued upon special terms and conditions.

AMENDMENT OF ARTICLES OF ASSOCIATION

162.Subject to the Companies Law, the Company may at any time and from time to time by Special Resolution alter or amend the Memorandum or these Articles in whole or in part.

CLOSING OF REGISTER OR FIXING RECORD DATE

163.For the purpose of determining those Shareholders that are entitled to receive notice of, attend or vote at any meeting of Shareholders or any adjournment thereof, or those Shareholders that are entitled to receive payment of any dividend, or in order to make a determination as to who is a Shareholder for any other purpose, the Directors may provide that the Register shall be closed for transfers for a stated period which shall not exceed in any case forty (40) days.  If the Register shall be so closed for the purpose of determining those Shareholders that are entitled to receive notice of, attend or vote at a meeting of Shareholders the Register shall be so closed for at least ten (10) days immediately preceding such meeting and the record date for such determination shall be the date of the closure of the Register.

164.In lieu of or apart from closing the Register, the Directors may fix in advance a date as the record date for any such determination of those Shareholders that are entitled to receive notice of, attend or vote at a meeting of the Shareholders and for the purpose of determining those Shareholders that are entitled to receive payment of any dividend the Directors may, at or within ninety (90) days prior to the date of declaration of such dividend, fix a subsequent date as the record date for such determination.

165.If the Register is not so closed and no record date is fixed for the determination of those Shareholders entitled to receive notice of, attend or vote at a meeting of Shareholders or those Shareholders that are entitled to receive payment of a dividend, the date on which notice of the meeting is posted or the date on which the resolution of the Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of Shareholders.  When a determination of those Shareholders that are entitled to receive notice of, attend or vote at a meeting of

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Shareholders has been made as provided in this Article, such determination shall apply to any adjournment thereof.

REGISTRATION BY WAY OF CONTINUATION

166.The Company may by Special Resolution resolve to be registered by way of continuation in a jurisdiction outside the Cayman Islands or such other jurisdiction in which it is for the time being incorporated, registered or existing.  In furtherance of a resolution adopted pursuant to this Article, the Directors may cause an application to be made to the Registrar of Companies to deregister the Company in the Cayman Islands or such other jurisdiction in which it is for the time being incorporated, registered or existing and may cause all such further steps as they consider appropriate to be taken to effect the transfer by way of continuation of the Company.

DISCLOSURE

167.The Directors, or any service providers (including the officers, the Secretary and the registered office agent of the Company) specifically authorised by the Directors, shall be entitled to disclose to any regulatory or judicial authority any information regarding the affairs of the Company including without limitation information contained in the Register and books of the Company.

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EX-4.2

Exhibit 4.2

Gridsum Holding Inc.

Number	Shares
[        ]	-[          ]-

Incorporated under the laws of the Cayman Islands

Share capital is US$200,000, divided into (i) 20,000,000 Class A ordinary shares with a par value of US$0.001 each, and (ii) 180,000,000 Class B ordinary shares with a par value of US$0.001 each

THIS IS TO CERTIFY THAT [                                ] is the registered holder of [                   ] Class [   ] ordinary shares in the above-named Company subject to the Memorandum and Articles of Association thereof.

EXECUTED on behalf of the said Company on the [          ] day of [                     ]      by:

DIRECTOR

EX-4.4

Exhibit 4.4

SECOND AMENDED AND RESTATED SHAREHOLDERS’ AGREEMENT

SECOND AMENDED AND RESTATED SHAREHOLDERS’ AGREEMENT

THIS SECOND AMENDED AND RESTATED SHAREHOLDERS’ AGREEMENT (this “Agreement”) is entered into on June 30, 2015 (the “Effective Date”), by and among:

(1)Gridsum Holding Inc., a company organized and existing under the laws of the Cayman Islands (the “Company”),

(2)Gridsum Holding (China) Limited (國雙控股（中國）有限公司), a company organized and existing under the laws of Hong Kong (the “HK Holdco”),

(3)Dissector (Beijing) Technology Co. Ltd. (迪塞克特（北京）科技有限公司), a company organized and existing under the laws of the People’s Republic of China (the “WFOE”),

(4)Gridsum Holding (Beijing) Co., Ltd. (国双控股（北京）有限公司), a limited liability company organized and existing under the Laws of the People’s Republic of China (“Gridsum Holdco”),

(5)Beijing Gridsum Technology Co., Ltd. (北京国双科技有限公司), a limited liability company organized and existing under the Laws of the People’s Republic of China (“Beijing Gridsum”),

(6)Beijing Moment Everlasting Ad Co., Ltd. (北京千里日成广告有限公司), a limited liability company organized and existing under the Laws of the People’s Republic of China (“Beijing Moment”),

(7)Guoxinjunhe (Beijing) Technology Co., Ltd. (国信君和（北京）科技有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China (“Guoxinjunhe”),

(8)Beijing Yunyang Ad Co., Ltd. (北京云洋广告有限公司), a limited liability company organized and existing under the laws of the People’s Republic of China (“Beijing Yunyang”),

(9)Fairy Spirit Limited, a company organized and existing under the laws of the British Virgin Islands (the “Employee Holdco”),

(10)Tom Melcher Revocable Trust, a trust established and existing under the laws of State of New York,

(11)the individuals listed in Schedule I attached hereto (the “Management Shareholders”, and each a “Management Shareholder”),

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(12)the entities listed in Schedule I attached hereto (the “Management Holdcos” and each a “Management Holdco”, together with the Management Shareholders, the “Management Parties”), and

(13)the shareholders listed in Schedule II attached hereto (the “Preferred Shareholders”, and each an “Preferred Shareholder”).

Each of the Company, the HK Holdco, the WFOE, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang, Tom Melcher Revocable Trust, the Employee Holdco, the Management Parties, and the Preferred Shareholders is referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

The Parties desire to enter into this Agreement and make the respective representations, warranties, covenants and agreements set forth herein on the terms and conditions set forth herein.

WITNESSETH

NOW, THEREFORE, in consideration of the foregoing recitals, the mutual promises hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties intending to be legally bound hereto hereby agree as follows:

1.Definitions.  The following terms shall have the meanings ascribed to them below:

“Accepting Shareholders” has the meaning set forth in Section 6.5 hereof.

“Affiliate” means, except with respect to individuals, any other Person that, directly or indirectly, Controls, is Controlled by or is under common Control with such Person, and with respect to an individual, anyone who is a Relative.  In the case of GS, the term “Affiliate” includes (a) any direct or indirect shareholder of GS, (b) any of such shareholder’s general partners or limited partners, (c) the fund manager managing such shareholder (and general partners, limited partners and officers thereof), (d) trusts Controlled by or for the benefit of any such individuals referred to in (a), (b) or (c), and (e) any fund or holding company formed for investment purposes that is promoted, sponsored, managed, advised or serviced by The Goldman Sachs Group, Inc. or any of its Affiliates.

“Agreement” has the meaning set forth in the Preamble of this Agreement.

“Anti-Corruption Laws” means any anti-bribery or anti-corruption Law of any jurisdiction in which the Company performs business, or of PRC, or of the United States, or of the United Kingdom, including without limitation, the PRC Criminal Law, the PRC Anti-Unfair Competition Law, the Foreign Corrupt Practices Act of 1977, as amended (“FCPA”), the U.K. Bribery Act of 2010, and where applicable, legislation enacted by

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member states and signatories implementing the OECD Convention Combating Bribery of Foreign Officials.

“Applicable Accounting Principles” means either the international financial reporting standards and the related interpretations adopted by the International Accounting Standards Board or the generally accepted accounting principles in the United States, as to be mutually agreed among the Preferred Shareholders and the Company.

“Audit Committee” has the meaning set forth in Section 2.4 hereof.

“Beijing Gridsum” has the meaning set forth in the Preamble of this Agreement.

“Beijing Moment” has the meaning set forth in the Preamble of this Agreement.

“Beijing Yunyang” has the meaning set forth in the Preamble of this Agreement.

“Big Four Accounting Firm” means any of the following accounting firms: Deloitte Touche Tohmatsu, Ernst & Young, KPMG or PricewaterhouseCoopers.

“Business Day” means a day other than Saturday, Sunday, or public holiday in PRC, Hong Kong and the United States of America on which commercial banks are open for business in each such jurisdiction.

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

“CFC” means a controlled foreign corporation as defined in the Code.

“Charter Documents” means, as to a Person, such Person’s certificate of incorporation, formation or registration (including, if relevant, certificates of change of name), memorandum of association, articles of association or incorporation, charter, by-laws, trust deed, trust instrument, partnership, operating agreement, limited liability company, joint venture or shareholders’ agreement or equivalent documents, and business license, in each case as amended.

“Circular 37” has the meaning set forth in Section 7.7(ii) hereof.

“Class A Ordinary Shares” has the meaning set forth in Memorandum and Articles.

“Class B Ordinary Shares” has the meaning set forth in Memorandum and Articles.

“Code” means the Internal Revenue Code of 1986, as amended.

“Commission” has the meaning set forth in Schedule IV hereof.

“Company” has the meaning set forth in the Preamble hereof.

“Company ROFR Shares” has the meaning set forth in Section 6.3 hereof.

“Company Security Holder” has the meaning set forth in Section 7.7(ii) hereof.

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“Compensation Committee” has the meaning set forth in Section 2.4 hereof.

“Control” of a given Person means the power or authority, whether exercised or not, to direct the business, management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise, which power or authority shall conclusively be presumed to exist upon possession of beneficial ownership or power to direct the vote of more than fifty percent (50%) of the votes entitled to be cast at a meeting of the members or shareholders of such Person or power to control the composition of a majority of the board of directors of such Person; the term “Controlled” has the meaning correlative to the foregoing.

“Controlled Entity” means Gridsum Holdco, any of its Subsidiaries or any other company organized and existing under the Laws of the PRC and Controlled by the Company or any Subsidiary of the Company.

“Conversion Shares” means Class B Ordinary Shares issued or issuable upon conversion of Preferred Shares.

“Co-Sale Shares” has the meaning set forth in Section 6.4(ii) hereof.

“Covenantors” means collectively, the Company, the HK Holdco, WFOE, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe and Beijing Yunyang.

“Deemed Liquidation Event” has the meaning given to such term in the Memorandum and Articles.

“Disclosing Party” has the meaning set forth in Section 7.13(iii) hereof.

“Drag Along Event” has the meaning set forth in Section 6.5(i) hereof.

“Effective Date” has the meaning set forth in the Preamble of this Agreement.

“Employee Holdco” has the meaning set forth in the Preamble of this Agreement.

“Equity Securities” means, with respect to a Person, any shares, share capital, registered capital, ownership interest, equity interest, or other securities, and any option, warrant, or right to subscribe for, acquire or purchase any of the foregoing, or any other security or instrument convertible into or exercisable or exchangeable for any of the foregoing, or any equity appreciation, phantom equity, equity plans or similar rights with respect to such Person, and, with respect to the Company, shall include any Ordinary Shares and Ordinary Share Equivalents of the Company.

“ESOP” means the equity incentive plan of the Company duly adopted by the Company pursuant to which 2,500,000 Class B Ordinary Shares (as adjusted for share splits and similar events) in the aggregate may be issued to employees and consultants of the Group.

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“Exercising Shareholder of Right of First Offer” has the meaning set forth in Section 6.2(ii)(c) hereof.

“Financing Terms” has the meaning set forth in Section 7.13(i) hereof.

“First Anniversary Date” has the meaning set forth in Section 8.6 hereof.

“Governmental Authority” means any nation or government or any federation, province or state or any other political subdivision thereof; any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any government authority, agency, department, board, commission or instrumentality of the PRC, the jurisdiction in which the Company is organized, or any other country, or any political subdivision thereof, any court, tribunal or arbitrator, and any self-regulatory organization.

“Governmental Order” means any applicable order, ruling, decision, verdict, decree, writ, subpoena, mandate, precept, command, directive, consent, approval, award, judgment, injunction or other similar determination or finding by, before or under the supervision of any Governmental Authority.

“Government Entity” means any government or any department, agency or instrumentality thereof, including any entity or enterprise owned or controlled by a government, or a public international organization.

“Government Official” has the meaning set forth in Section 7.3 hereof.

“Guoxinjunhe” has the meaning set forth in the Preamble of this Agreement.

“Gridsum Holdco” has the meaning set forth in the Preamble of this Agreement.

“Group Company” means each of the Company, the HK Holdco, the WFOE, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe, and Beijing Yunyang, together with each Subsidiary of any of the foregoing, and each Person (other than a natural person) that is, directly or indirectly, Controlled by any of the foregoing, including but not limited to each joint venture in which any of the foregoing holds more than fifty percent (50%) of the voting power, and “Group” refers to all of Group Companies collectively.

“GS” means (a) Broad Street Investments Holding (Singapore) Pte. Ltd., a limited liability company incorporated under the laws of the Republic of Singapore, whose registered address is at 1 Raffles Link, #07-01, Singapore 39393, (b) ) any Affiliate of (a) that holds Share(s) in the Company at any time, and (c) any of their respective Permitted Transferees.

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

“HK Holdco” has the meaning set forth in the Preamble of this Agreement.

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“Independent Directors” has the meaning set forth in Section 2.1(i) hereof.

“Indirect US Investor” has the meaning set forth in Section 8.3 hereof.

“Issuance Notice” has the meaning set forth in Section 5.2 hereof.

“Key Employee” means each of the Persons listed on Schedule III and Key Employees mean such Persons collectively.

“Law” or “Laws” means any constitutional provision, statute or other law, rule, regulation, official policy or interpretation of any Governmental Authority and any Governmental Order.

“Management Holdcos” has the meaning set forth in the Preamble of this Agreement.

“Management Holdcos Majority” means one or more Management Holdcos that hold more than a majority in voting power of the then issued and outstanding Ordinary Shares (on an as-converted basis) held by the Management Holdcos.

“Management Shareholders” has the meaning set forth in the Preamble of this Agreement.

“Management Parties” has the meaning set forth in the Preamble of this Agreement.

“Memorandum and Articles” means the Fourth Amended and Restated Memorandum of Association of the Company and the Fourth Amended and Restated Articles of Association of the Company, as each may be amended and/or restated from time to time.

“Money Laundering Laws” has the meaning set forth in Section 7.6 hereof.

“New Securities” means, subject to the terms of Section 5 hereof, any Equity Securities of the Company, except for (i) any Ordinary Shares, or any option or warrant to acquire any Ordinary Shares, issued to employees, officers, consultants or directors of the Company pursuant to the ESOP; (ii) Equity Securities of the Company issued upon conversion of Preferred Shares; (iii) Equity Securities of the Company issued in connection with a bona fide acquisition of another business approved by the Preferred Shareholder Majority; (iv) Equity Securities of the Company issued in a Qualified IPO; or (v) Equity Securities of the Company issued in connection with any share split, share dividend, combination, or similar transaction of the Company.

“NGP” means Nokia Growth Partners II, L.P.

“NGP Observer” has the meaning set forth in Section 2.3 hereof.

“Non-competition Period” has the meaning set forth in Section 7.11(i) hereof.

“OA” means Rainbow Castle Holdings Limited (or its designated affiliate).

“OA Observer” has the meaning set forth in Section 2.3 hereof.

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“Observer” has the meaning set forth in Section 2.3 hereof.

“OFAC” has the meaning set forth in Section 7.5 hereof.

“Offered Shares” has the meaning set forth in Section 6.2(i) hereof.

“Option Period” has the meaning set forth in Section 6.2(ii)(a) hereof.

“Ordinary Directors” has the meaning set forth in Section 2.1(i) hereof.

“Ordinary Share Equivalents” means warrants, options and rights exercisable for Ordinary Shares and instruments convertible into or exchangeable for Ordinary Shares, including, without limitation, the Preferred Shares.

“Ordinary Shareholders” mean the holders of Ordinary Shares.

“Ordinary Shares” means the Company’s Class A Ordinary Shares and Class B Ordinary Shares, par value US$0.001 per share.

“Partnership Election” has the meaning set forth in Section 8.1 hereof.

“Party” or “Parties” have the meaning set forth in the Preamble of this Agreement.

“Person” means any individual, corporation, partnership, limited partnership, proprietorship, association, limited liability company, firm, trust, estate or other enterprise or entity.

“Permitted Transferee” means, with respect to any Preferred Shareholder, an entity Controls, Controlled by, or under common Control with any Preferred Shareholder; provided, that such Preferred Shareholder that is a corporation may freely transfer any of its Equity Securities to any shareholder of such Preferred Shareholder; and any Preferred Shareholder which is a limited or general partnership may freely transfer any of its Equity Securities to its partners and to affiliated partnerships managed by the same management company or managing (general) partner or by an entity which controls, is controlled by, or is under common control with, such management company or managing (general) partner.  In the case of the Preferred Shareholders, a Permitted Transferee includes any of their respective Affiliates.

“PFIC” means passive foreign investment company as defined in the Code.

“PFIC Shareholder” has the meaning set forth in Section 8.3 hereof.

“PRC” means the People’s Republic of China, but solely for the purposes of this Agreement, excluding the Hong Kong Special Administrative Region, the Macau Special Administrative Region and the islands of Taiwan.

“Preemptive Right” has the meaning set forth in Section 5.1 hereof.

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“Preferred Series C Majority” means one or more Preferred Shareholders who hold a majority in voting power of the then outstanding Series C Preferred Shares.

“Preferred Shares” means collectively the Series A Preferred Shares, Series A-1 Preferred Shares, Series B Preferred Shares and Series C Preferred Shares.

“Preferred Shareholder Directors” means, collectively, the Series A Director, the Series B Director and the Series C Director (each a “Preferred Shareholder Director”) who currently serve on the Board, excluding, for the avoidance of doubt, any such Person who has vacated his/her office in accordance with Section 2.1 hereof and/or Article 72 or 73 of the Memorandum and Articles.

“Preferred Shareholder Majority” means one or more Preferred Shareholders who hold more than a majority in voting power of the then outstanding Preferred Shares (on an as-converted basis).

“Preferred Shareholders” has the meaning set forth in the Preamble of this Agreement.

“Qualified IPO” has the meaning set forth in the Memorandum and Articles.

“Quantum” means Quantum Strategic Partners Ltd.

“Related Party” means an officer, director or Affiliate of any Group Company or any “affiliate” or “associate” (as those terms are defined in Rule 405 promulgated under the Securities Act) of any of them or any Relative of any of them.

“Relative” means a husband, wife, father, mother, son, daughter, brother, sister, grandparent, grandchild, or spouse of any of these, or a person living in the same household with an individual.

“Relevant Person” means (a) the Company or any of its Subsidiaries or (b) any officer, employee, director, agent, Affiliate or Person acting on behalf of the Company or any of its Subsidiaries.

“Report” has the meaning set forth in Section 8.6 hereof.

“ROFR Option Period” has the meaning set forth in Section 6.3(iii) hereof.

“ROFR Notice” has the meaning set forth in Section 6.3(ii) hereof.

“SAFE” has the meaning set forth in Section 7.7(i) hereof.

“SDN List” has the meaning set forth in Section 7.5 hereof.

“Second Notice” has the meaning set forth in Section 6.2(ii)(c) hereof.

“Securities Act” has the meaning set forth in Schedule IV hereof.

“Selling Shareholder” has the meaning set forth in Section 6.4(i) hereof.

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“Series A Director” has the meaning set forth in Section 2.1(i) hereof.

“Series A Preferred Shares” means the Series A Preferred Shares of the Company, par value US$0.001 per share, with the rights and privileges as set forth in the Memorandum and Articles.

“Series A Preferred Shareholders” means the holders of the Series A Preferred Shares.

“Series A Preferred Shareholders Majority” means one or more Series A Preferred Shareholders who hold more than a majority in voting power of the then outstanding Series A Preferred Shares (on an as-converted basis).

“Series A-1 Preferred Shares” means the Series A-1 Preferred Shares of the Company, par value US$0.001 per share, with the rights and privileges as set forth in the Memorandum and Articles.

“Series A-1 Preferred Shareholders” means the holders of the Series A-1 Preferred Shares.

“Series B Director” has the meaning set forth in Section 2.1(i) hereof.

“Series B Preferred Shares” means the Series B Preferred Shares of the Company, par value US$0.001 per share, with the rights and privileges as set forth in the Memorandum and Articles.

“Series B Preferred Shareholders” means the holders of the Series B Preferred Shares.

“Series B Preferred Shareholders Majority” means one or more Series B Preferred Shareholders who hold more than a majority in voting power of the then outstanding Series B Preferred Shares (on an as-converted basis).

“Series C Director” has the meaning set forth in Section 2.1(i) hereof.

“Series C Preferred Shares” means has the meaning given to it in the Series C Preferred Shares Purchase Agreement.

“Series C Preferred Shareholders” means the holders of the Series C Preferred Shares.

“Series C Preferred Shareholders Majority” means one or more Series C Preferred Shareholders who hold more than a majority in voting power of the then outstanding Series C Preferred Shares (on an as-converted basis).

“Series C Preferred Shares Purchase Agreement” means the Series C Preferred Shares Purchase Agreement, dated as of January 26, 2015 by and among the Parties hereto.

“Share Sale” means a transaction or series of related transactions in which a Person, or a group of related Persons, acquires any Equity Securities of the Company such that,

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immediately after such transaction or series of related transactions, such Person or group of related Persons holds Equity Securities of the Company representing more than fifty percent (50%) of the outstanding voting power of the Company.

“Shares” means the Ordinary Shares and the Preferred Shares.

“Shareholders” means the Ordinary Shareholders and Preferred Shareholders, and “Shareholder” means any one of them.

“Special Resolution” has the same meaning as in the Statute and includes a resolution approved in writing as described therein.

“Steamboat” means Steamboat Ventures Asia, L.P..

“Statute” means the Companies Law of the Cayman Islands, as amended, and every statutory modification or re-enactment thereof for the time being in force.

“Subsidiary” means, with respect to any specified Person, any Person of which the specified Person, directly or indirectly, owns or Controls more than fifty percent (50%) of the issued and outstanding authorized share capital, voting interests or registered capital.

“Third Party Purchaser” has the meaning set forth in Section 6.3(i) hereof.

“Transaction Documents” means this Agreement, the Series C Preferred Shares Purchase Agreement, the Memorandum and Articles, the exhibits attached to any of the foregoing and each of the agreements and any other document or agreement entered into or provided by a Party in connection with implementing the transactions contemplated by any of the foregoing.

“Transfer” has the meaning set forth in Section 6.2(i) hereof.

“Transfer Notice” has the meaning set forth in Section 6.2(i) hereof.

“Transferor” has the meaning set forth in Section 6.2(i) hereof.

“UOB” means UVM 2 Venture Investments LP acting through its general partner UOB Bioventures Management Pte Ltd.

“UOB Observer” has the meaning set forth in Section 2.3 hereof.

“U.S.” means the United States of America.

“U.S. Economic Sanctions” has the meaning set forth in Section 7.5 hereof.

“U.S. Person” or “United States Person” means any person described in Section 7701(a)(30) of the Code.

“WFOE” has the meaning set forth in the Preamble of this Agreement.

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2.Corporate Governance.

2.1Board of Directors.

(i)From and after the date hereof, the Company shall have a Board consisting of up to nine (9) authorized directors.  The Management Holdcos Majority shall have the right to appoint  three (3) directors (the “Ordinary Directors”), initially being Qi Guosheng (祁国晟), Yu Guofa (于国法) and Bai Yanchun (白彦春).  Series A Preferred Shareholders Majority shall have the right to appoint one (1) director (the “Series A Director”), initially being Perry Chui. Series B Preferred Shareholders Majority shall have the right to appoint one (1) director (the “Series B Director”), initially being James Hyeong Uk Chang. GS (or the Preferred Series C Majority in the event that GS Transfers all or any portion of the Shares held by GS in the Company, except for Transfers by GS to its Permitted Transferees) shall have the right to appoint one (1) director (the “Series C Director”), initially being Fan Xiang (范翔).  One (1) of the Ordinary Directors shall be the then chief executive officer of the Company (being Qi Guosheng as of the date hereof).  The remaining three (3) directors shall be elected by a majority of the Board (including affirmative votes of the then chief executive officer of the Company and all Preferred Shareholder Directors), two of which initially being Gao Xudong (高旭东) and Thomas Adam Melcher (collectively the “Independent Directors”).

(ii)At each election of the directors of the Board, each Shareholder shall vote at any meeting of members, such number of Shares as may be necessary, or in lieu of any such meeting, shall give such holder’s written consent, as the case may be, with respect to such number of Shares to keep the authorized size of the Board at nine (9) directors and in addition (a) as may be necessary to cause the election or re-election as members of the Board, and during such period to continue in office, each of the individuals designated pursuant to this Section 2.1 and (b) against any nominees not designated pursuant to this Section 2.1.

(iii)Any Person or group of Persons entitled to designate any individual to be elected as a director of the Board pursuant to this Section 2.1 shall have the right to remove any such director occupying such position and to fill any vacancy caused by the death, disability, retirement, resignation or removal of any director occupying such position.  Each Shareholder agrees to always vote such Shareholder’s respective Shares in support of the principle that a director to the Board designated pursuant to this Section 2.1 shall be removed from the Board with or without cause only upon the vote or written consent of the shareholders entitled to designate such director pursuant to Section 2.1, and each such holder further agrees not to seek, vote for or otherwise effect the removal with or without cause of any such director without such vote or written consent.  If a vacancy is created on the Board at any time by the death, disability, retirement, resignation or removal of any director designated pursuant to Section 2.1, the replacement to fill such vacancy shall be designated in the same manner, in accordance with Section 2.1, as the director whose seat was vacated.

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(iv)Any director not elected in the manner provided in sub-paragraphs (i), (ii), or (iii) shall be elected by the members at a general meeting, with holders of Preferred Shares and Ordinary Shares voting together on an as-converted basis and not as separate classes.

2.2Alternates.  Subject to applicable Law, each Director shall be entitled to appoint an alternate to serve at any Board meeting, and such alternate shall be permitted to attend all Board meetings and vote on behalf of the director for whom she or he is serving as an alternate.

2.3Board Observer.  So long as NGP does not sell any shares of the Company held by it to any third party other than an Affiliate of NGP, provided that such affiliate is not a competitor to the Company as determined in good faith by a majority of the Company’s Board of Directors, NGP shall have the right, from time to time, and at any time, to designate one (1) individual (the “NGP Observer”) who will be entitled to attend all meetings of the Board (whether in person, by telephone or other) in a non-voting capacity.  So long as OA does not sell any shares of the Company held by it to any third party other than an Affiliate of OA, provided that such affiliate is not a competitor to the Company as determined in good faith by a majority of the Company’s Board of Directors, OA shall have the right, from time to time, and at any time, to designate one (1) individual (the “OA Observer”) who will be entitled to attend all meetings of the Board (whether in person, by telephone or other) in a non-voting capacity.  So long as UOB does not sell any shares of the Company held by it to any third party other than an Affiliate of UOB, provided that such affiliate is not a competitor to the Company as determined in good faith by a majority of the Company’s Board of Directors, UOB shall have the right, from time to time, and at any time, to designate one (1) individual (the “UOB Observer”, together with NGP Observer and OA Observer, the “Observers” and each, an “Observer”) who will be entitled to attend all meetings of the Board (whether in person, by telephone or other) in a non-voting capacity.  The Company shall provide to each Observer, concurrently with the members of the Board, and in the same manner, notice of such meeting and a copy of all materials provided to such members.

2.4Establishment of Compensation Committee and Audit Committee; Auditors.  As reasonably practicable as possible following the Effective Date, the Company shall, and the Management Parties shall cause the Company to, establish and maintain (i) a Compensation Committee consisting of at least two Preferred Shareholder Directors and two Independent Directors (the “Compensation Committee”); and (ii) an Audit Committee consisting of at least two Preferred Shareholder Directors and two Independent Directors (the “Audit Committee”).  The Compensation Committee shall propose the terms of the Company’s equity incentive plans (including the ESOP), and all grants of awards thereunder, to the Board for approval and adoption by the Board and the Shareholders and shall have the power and authority to (a) administer the Company’s equity incentive plans (including the ESOP) and to grant options thereunder, and (b) approve all management compensation levels and arrangements, and shall have such other powers and authorities as the Board shall delegate to it.  The Audit Committee shall select the auditors of the Company and other Group Companies and approve the scope of the annual audit of the Company and other Group Companies, and shall have such other powers and authorities as the Board shall delegate to it.

2.5D&O Insurance.  Upon written request of any Preferred Shareholder, the Company shall, and the Management Parties shall cause the Company to, as promptly as

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practicable, purchase, and thereafter shall maintain, international standard directors’ and officers’ insurance on the best terms available in the market with one or more reputable and credit-worthy insurance companies, in relation to any person who is or was a director or an officer of the Company, or who at the request of the Company is or was serving as a director or an officer of, or in any other capacity is or was acting for, another company or a partnership, joint venture, trust or other enterprise or entity, against any liability asserted against the person and incurred by the person in that capacity.  The Memorandum and Articles shall at all times provide that the Company shall indemnify the members of the Board to the maximum extent permitted by the Law of the jurisdiction in which the Company is organized.

2.6Board Meetings.  The Company shall hold no less than one (1) Board meeting during each fiscal quarter.  A quorum for a Board meeting shall consist of five (5) directors, including all Preferred Shareholder Directors.  If a quorum shall not be present at any meeting of the Board, the directors present thereat may adjourn the meeting, until a quorum shall be present, provided that, if notice of the Board meeting has been duly delivered to all directors in accordance with the applicable notice procedures in the Memorandum and Articles, and the quorum is not present within one half hour from the time appointed for the meeting solely because of the absence of any Preferred Shareholder Director(s), the meeting shall be adjourned to the third following Business Day at the same time and place (or to such other time or such other place as the directors may determine) with notice duly delivered to all directors one day prior to the adjourned meeting pursuant to the applicable notice procedures in the Memorandum and Articles and, if at the adjourned meeting, the quorum is not present within one half hour from the time appointed for the meeting solely because of the absence of any Preferred Shareholder Director(s), then any five or more directors present shall be a quorum.  Any resolution of the Board shall be passed with no less than a majority affirmative votes of directors present at the Board meeting. In the case of an equality of votes or a deadlock for whatever reason at a Board meeting, the Ordinary Director who is the Chief Executive Officer of the Company shall have an additional casting vote.  The Company shall promptly reimburse each member of the Board of Directors and each Observer that participates in or attends Board and/or committee meetings for all reasonable, out-of-pocket expenses incurred in connection with such participation or attendance, including without limitation round-trip travel (provided such traveling fee is no more than the market price of the economy class of the flight from the resident city of such Director or Observer to the city where the meeting is held) and lodging and/or long-distance telephone charges.  The Directors shall also be entitled to reimbursement from the Company for all other reasonable expenses incurred in their service as directors, but not more than RMB2,000 per day.

2.7Boards of Other Group Companies.  At the request of the Preferred Shareholder Majority, the number of directors on the board of the HK Holdco and WFOE shall be constituted in the same manner as the Board, and the provisions in this Section 2 shall apply mutatis mutandis to the board of directors of the HK Holdco and the WFOE.  The Covenantors and the Management Parties shall take all steps required to give effect to the first sentence of this Section 2.7.

2.8Additional Covenants.  Each Party shall ensure that the rights granted hereunder are effective and that the Parties hereto enjoy the benefits thereof.  Such actions include, without limitation, the use of the Company’s best efforts to cause the nomination and election of the

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directors as provided above.  Each Party shall not avoid or seek to avoid the observance or performance of any of the terms to be performed hereunder by the Parties, and each Party shall, at all times in good faith take action as appropriate in the carrying out of all of the provisions of this Agreement.  Each Party agrees that it shall not enter into any other agreements or arrangements of any kind with respect to the voting of any Shares or deposit any Shares in a voting trust or other similar arrangement.

3.Protective Provisions.

3.1Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote of Preferred Shareholder Majority in writing, voting as a single class:

(i)amend, alter, or repeal any provisions of the Charter Documents of any Group Company (including the Memorandum and Articles) or any Control Document (as defined in the Memorandum and Articles);

(ii)create, authorize or issue (including by reclassification or otherwise) any Equity Securities of any Group Company (other than pursuant to the ESOP);

(iii)alter, reorganize or otherwise recapitalize the Equity Securities of any Group Company, including, without limitation, any increase, reduction or cancellation of the Equity Securities of any Group Company or any consolidation, subdivision or conversion of, or any alteration of the rights in respect of, any Equity Securities of any Group Company;

(iv)effect any sale, liquidation, dissolution, winding up, or merger of any Group Company, or transfer of all or substantially all of its assets, or any other transaction in which Control of any Group Company is transferred;

(v)repurchase or redeem any Equity Securities of any Group Company, except for redemption or repurchase of shares at cost upon termination of services of an employee, consultant, or independent contractor or pursuant to the Company’s exercise of its rights of first refusal;

(vi)change the size or composition of the board of directors of any Group Company;

(vii)declare or pay any dividend or other distribution on any Equity Securities of any Group Company;

(viii)issue debt or guarantee, together with any other then outstanding debt owed by the Group Companies, in excess of US$1,000,000;

(ix)approve or amend any stock option plan or other employee incentive plan or increase the number of shares reserved for issuance to employees, directors or contractors;

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(x)change the principal business of any Group Company, enter a new line of business or exit the current line of business;

(xi)appoint any of the following the positions of any Group Company: Chairman, Chief Executive Officer, Chief Financial Officer, Chief Technology Officer, President, Managing Director, any other Vice President level or above position, Controller, or HR Director;

(xii)appoint or remove the Company’s auditor or make any material change in the accounting or financial policies of the Company;

(xiii)appoint or remove directors of Group Companies (other than the Company);

(xiv)approve the annual budget and business plans and any material deviations therefrom;

(xv)allocation of any Equity Securities of the Company to employees and consultants of the Group under the ESOP;

(xvi)enter into any transaction with any Related Party or Affiliate of any Group Company, or amend any existing agreement with such Person;

(xvii)sell, transfer, change, pledge or encumber the equity interests in any of the Group Company (other than the Company);

(xviii)sell, transfer, license, pledge or encumber any technology or intellectual property of any of the Group Companies, other than licenses granted in the ordinary course of business;

(xix)acquire a business or enter into a joint venture with a transaction value in excess of US$1,000,000;

(xx)incur any items of expenditure outside the duly approved annual budget in excess of US$500,000 per month, individually or in the aggregate; or

(xxi)provide any increase in compensation of any employee of any Group Company with monthly salary of at least RMB40,000 by more than fifteen percent (15%) in a twelve (12) month period.

Where any action listed in paragraphs (i) to (xxi) above requires a Special Resolution in accordance with the Statute, and if the Shareholders vote in favor of such act but the approval of the Preferred Shareholder Majority has not been obtained, then each holder of a Preferred Share who votes against the resolution at a meeting of the Shareholders shall be deemed to have ten (10) times the number of votes of its own actual Shares.

3.2Series A Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Series A Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of

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arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Series A Preferred Shares, voting as a separate class:

(i)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares;

(ii)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A-1 Preferred Shares, the Series B Preferred Shares, or the Series C Preferred Shares, which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series A Preferred Shareholders.

3.3Series A-1 Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Series A-1 Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Series A-1 Preferred Shares, voting as a separate class:

(i)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A-1 Preferred Shares; or

(ii)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares, the Series B Preferred Shares, or the Series C Preferred Shares, which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series A-1 Preferred Shareholders.

3.4Series B Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Series B Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Series B Preferred Shares, voting as a separate class:

(i)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series B Preferred Shares; or

(ii)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares, the Series A-1 Preferred Shares or

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the Series C Preferred Shares, which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series B Preferred Shareholders.

3.5Series C Preferred Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Series C Preferred Share remains outstanding, each Covenantor shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the Preferred Series C Majority, voting as a separate class:

(i)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise) the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series C Preferred Shares;

(ii)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Series A Preferred Shares, the Series A-1 Preferred Shares or the Series B Preferred Shares, which will or is reasonably expected to have an adverse impact on the rights and entitlements (economic or otherwise) of the Series C Preferred Shareholders.

3.6Class A Ordinary Shares Protective Provisions.  In addition to any other rights provided by law and the Memorandum and Articles, for so long as any Class A Ordinary Share remains outstanding, the Company shall cause each Group Company not to take any of the following actions (whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise) without an affirmative vote in writing of the holders of a majority of the then outstanding Class A Ordinary Shares, voting as a separate class:

(i)change, modify or amend (including by reclassification, by amendment to the Memorandum and Articles, or otherwise), the terms, conditions, rights, preferences, privileges, limitations, or restrictions of the Class A Ordinary Shares;

(ii)create, authorize or issue (including by reclassification or otherwise) any Class A Ordinary Share of any Group Company.

4.Information and Inspection Rights.

4.1Delivery of Financial Statements.  The Company shall, and each Covenantor shall cause the Company to, deliver to each Preferred Shareholder the following documents or reports:

(i)as soon as practicable, but in any event within ninety (90) days after the end of each fiscal year, the audited consolidated income statements and statements of cash flows of the Company for such fiscal year, and the audited consolidated balance sheet of the Company as of the end of such fiscal year, prepared in accordance with Applicable Accounting Principles and audited by a Big Four Accounting Firm;

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(ii)as soon as practicable, but in any event within thirty (30) days after the end of each calendar month, the unaudited and unconsolidated management accounts of each member of the Group for such calendar month, prepared in accordance with Applicable Accounting Principles and including information regarding headcount, comparisons to monthly budgets, information regarding the capitalization of the Company, and any other information reasonably requested by such Preferred Shareholder; and

(iii)as soon as practicable, but in any event no later than the beginning of each fiscal year, a comprehensive operating budget and business plan for the such fiscal year for the Group Companies, setting forth for each month during such fiscal year a projected balance sheet, cash flow statement and profit and loss statement.

4.2Inspection.  Each Covenantor shall cause each Group Company to, permit Series A Preferred Shareholders Majority, Series B Preferred Shareholders Majority and Series C Preferred Shareholders Majority or their duly designated representatives, during normal business hours following reasonable notice but no more than one (1) time per quarter and four (4) times per year, to visit and inspect the relevant Group Company, its Subsidiaries, any of the properties of the Group Company or its Subsidiaries, and to examine the books of account and records of the Group Company and its Subsidiaries, and to discuss the affairs, finances and accounts of the Group Company and its Subsidiaries with the directors, officers, management employees, accountants, legal counsel and investment bankers of such entities.

4.3Accounts Monitoring Access.  For so long as the Preferred Shareholders hold any Preferred Shares, the Company shall and each other Covenantor shall cause the Company to provide to each of Preferred Shareholders (or their respective representatives) monitoring access (including online access) to the Company’s offshore accounts with any banks, brokers or other financial institutions.

5.Preemptive Rights.

5.1General.  The Company hereby grants to each Preferred Shareholder a right (the “Preemptive Right”) to purchase up to its pro rata share of any New Securities that the Company may, from time to time, propose to sell or issue, in the proportions set forth in this Section 5.1.  Each Preferred Shareholder’s “pro rata share” for the purposes of this Section 5.1 shall be determined according to the aggregate number of Conversion Shares in respect of all Preferred Shares held by such Preferred Shareholder immediately prior to the issuance of the New Securities in relation to the aggregate number of Conversion Shares in respect of all Preferred Shares then outstanding immediately prior to the issuance of the New Securities.

5.2Issuance Notice.  In the event the Company proposes to undertake an issuance of New Securities, it shall give each Preferred Shareholder written notice (an “Issuance Notice”) of such intention, describing (i) the type of New Securities, (ii) the identity of the prospective subscriber, and (iii) the price and the general terms upon which the Company proposes to issue the same.  Each of the Preferred Shareholders shall have fifteen (15) days after the receipt of such notice to agree to purchase up to such Preferred Shareholder’s respective pro rata share of such New Securities (as determined in Section 5.1) for the price and upon the terms specified in

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the notice by giving written notice to the Company and stating therein the quantity of New Securities to be purchased.

5.3Sales by the Company.  For a period of one hundred and fifty (150) days following the expiration of the fifteen (15) day period as described in Section 5.2, the Company may sell any New Securities with respect to which the Preferred Shareholders’ rights under this Section 5 were not exercised, to the purchasers identified in the Issuance Notice and at a price and upon terms not more favorable to the purchasers thereof than specified in the Issuance Notice.  In the event the Company has not sold such New Securities within such one hundred and fifty (150) day period, the Company shall not and the other Covenantors shall cause the Company not to thereafter issue or sell any New Securities, without first again offering such securities to the Preferred Shareholders in the manner provided in this Section 5.

6.Share Transfer Rights and Restrictions

6.1Prohibition on Transfer of Shares.

(i)General.  Notwithstanding any other provision to the contrary herein and subject to Section 6.1(ii), none of the Parties shall directly or indirectly sell, assign, transfer, pledge, hypothecate, or otherwise encumber or dispose of in any way (“Transfer”) all or any part of any interest in any Shares except pursuant to this Section 6.  None of the Management Holdcos, the Tom Melcher Revocable Trust, and the Employee Holdco shall directly or indirectly Transfer in any way all or any part of any interest in any Shares without the prior written consent of the Preferred Shareholder Majority.

(ii)Permitted Transfers.  Any Transfer of Equity Securities of the Company by any Preferred Shareholder to its Permitted Transferee(s) may be made without compliance with Sections 6.2, 6.3, 6.4 and 6.5 hereof.

(iii)Prohibited Transfers Void.  Any Transfer of Equity Securities of the Company not made in compliance with this Agreement shall be null and void as against the Company, shall not be recorded on the books of the Company and shall not be recognized by the Company.

(iv)No Indirect Transfers.  Except for transfers by Preferred Shareholders to Permitted Transferees, each of the Parties shall not circumvent or otherwise avoid the rights of other Shareholders under Sections 6.2, 6.3, 6.4 and 6.5 hereof or intent thereof set forth in this Agreement, whether by holding the Equity Securities of the Company indirectly through another Person (including any Affiliates) or by causing or effecting, directly or indirectly, the Transfer or issuance of any Equity Securities by any such Person (including any Affiliates), or otherwise.  Each of the Parties furthermore agrees that, so long as such  Party is bound by this Agreement and subject to Section 6.1(ii), the Transfer, sale or issuance of any Equity Securities of any holding company of such Party (including without limitation the Management Holdcos) without the prior written consent of the Board of Director (including the consent of all Preferred Shareholder Directors) shall be prohibited, and each such Party agrees not to make, cause or permit any Transfer, sale or issuance of any Equity Securities of such holding company without the prior written consent of the Board of Director (including the consent of all Preferred Shareholder Directors).  Any purported Transfer, sale or issuance of any Equity Securities of any

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such holding company in contravention of this Agreement shall be void and ineffective for any and all purposes and shall not confer on any transferee or purported transferee any rights whatsoever, and no Party (including without limitation, any Management Party) shall recognize any such Transfer, sale or issuance.  The Management Parties shall cause the Employee Holdcos not to permit any Transfer of shares of the Employee Holdco and Tom Melcher Revocable Trust or any interest therein, directly or indirectly, by their shareholders.

6.2Rights of First Offer.

(i)Transfer Notice.  Except for a permitted Transfer made by any Preferred Shareholder pursuant to Section 6.1(ii), if any Shareholder  proposes to sell any Equity Securities of the Company (such holder, a “Transferor”), then the Transferor shall give the Company and other Shareholders a written notice of the Transferor’s intention to make the Transfer (the “Transfer Notice”), which shall include (a) a description of the Equity Securities of the Company to be Transferred (the “Offered Shares”) and (b) the proposed consideration and other material terms and conditions upon which the Offered Shares are offered.

(ii)Shareholders’ Option.

(a)Each Shareholder (other than the Transferor) shall have an option for a period of ten (10) days following receipt of the Transfer Notice (the “Option Period”) to elect to purchase all or any portion of its respective pro rata share of the Offered Shares set out in the Transfer Notice at the price and subject to the material terms and conditions as described in the Transfer Notice, by notifying the Transferor and the Company in writing before expiration of the Option Period as to the number of such Offered Shares that it wishes to purchase.

(b)For the purposes of this Section 6.2(ii), each such Shareholder’s “pro rata share” of the Offered Shares shall be equal to (A) the total number of Offered Shares, multiplied by (B) a fraction, the numerator of which shall be the aggregate number of Ordinary Shares held by such Shareholder (on as-converted basis assuming conversion of all Preferred Shares) on the date of the Transfer Notice and the denominator of which shall be the aggregate number of Ordinary Shares issued and outstanding on such date (on as-converted basis assuming conversion of all Preferred Shares).

(c)If any such Shareholder fails to exercise its right to purchase its full pro rata share of the available Offered Shares, the Transferor shall deliver a written notice (the “Second Notice”) within five (5) days after the expiration of the Option Period to the Company and each Shareholder that elected to purchase its entire pro rata share of the Offered Shares (an “Exercising Shareholder of Right of First Offer”).  The Exercising Shareholders of Right of First Offer shall have a right of re-allotment, and may exercise an additional right to purchase such unpurchased Offered Shares by notifying the Transferor and the Company in writing within ten (10) days after receipt of the Second Notice; provided, however, that if the Exercising Shareholders of Right of First Offer desire to purchase in aggregate more than the number of such unpurchased Offered Shares, then such unpurchased Offered Shares will be allocated to the extent necessary among the Exercising Shareholders of Right of First Offer in accordance with their relative pro rata shares based on the number of the unpurchased Offered Shares such

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Exercising Shareholders of Right of First Offer have elected to purchase pursuant to this Section 6.2(ii)(c).

(d)Subject to applicable securities Laws, each such Preferred Shareholder shall be entitled to apportion Offered Shares to be purchased among its Affiliates, provided that such Preferred Shareholder notifies the Company and the Transferor in writing.

(iii)Procedure.

(a)If any Shareholder gives the Transferor notice that it desires to purchase Offered Shares, and, as the case may be, its re-allotment, then payment for the Offered Shares to be purchased shall be made by wire transfer in immediately available funds of the appropriate currency, against delivery of such Offered Shares to be purchased with an executed instrument of transfer, at a place agreed to by the Transferor and all the participating Shareholders and at the time of the scheduled closing therefor, no later than sixty (60) days after the participating Shareholder’s receipt of the Transfer Notice.

(b)The exercise or non-exercise of the rights of the Shareholders under Section 6.2 to purchase Equity Securities of the Company from a Transferor shall not adversely affect their rights to make subsequent purchases from the Transferor of Equity Securities of the Company by the Transferor hereunder.

6.3Non-Exercise of Rights of First Offer and the Company’s Rights of First Refusal.

(i)To the extent that the Shareholders have not exercised their rights to purchase all Offered Shares within the time periods specified in Section 6.2, subject to the procedures set forth in this Section 6.3, the Transferor shall have a period of sixty (60) days from the expiration of such rights specified in Section 6.2 to offer the remaining Offered Shares (the “Company ROFR Shares”) to any third party purchaser (“Third Party Purchaser”) upon terms and conditions (including the purchase price) no more favorable to Third Party Purchaser than those specified in the Transfer Notice.

(ii)If the Transferor proposes to sell the Company ROFR Shares to a Third Party Purchaser, the Transferor shall give the Company a written notice (the “ROFR Notice”), which shall include (a) a description of the Company ROFR Shares, (b) the identity of the Third Party Purchaser(s) and (c) the consideration and other material terms and conditions upon which the proposed Transfer is to be made.  The RFOR Notice shall certify that the Transferor has received a definitive offer from the Third Party Purchaser and in good faith believes a binding agreement for the Transfer is obtainable on the terms set forth in the Transfer Notice. The RFOR Notice shall also include a copy of any written proposal, term sheet or letter of intent or other agreement relating to the proposed Transfer.

(iii)The Company shall have an option for a period of ten (10) days following receipt of the ROFR Notice (the “ROFR Option Period”) to elect to purchase all of the Company ROFR Shares set out in the ROFR Notice at the same price and subject to the same material

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terms and conditions as described in the ROFR Notice, by notifying the Transferor in writing before expiration of the ROFR Option Period.

(iv)If the Company gives the Transferor notice that it desires to purchase all of the Company ROFR Shares, then payment for the Company ROFR Shares to be purchased shall be made by wire transfer in immediately available funds of the appropriate currency, against delivery of such Company ROFR Shares to be purchased with an executed instrument of transfer, at a place agreed to by the Transferor and the Company and at the time of the scheduled closing therefor, no later than thirty (30) days after the Company’s receipt of the ROFR Notice.

(v)To the extent that the Company has not exercised its rights to purchase all Company ROFR Shares within the ROFR Option Period, the Transferor shall have a period of ninety (90) days from the expiration of the ROFR Option Period to sell all of the Company ROFR Shares to the Third Party Purchaser identified in the ROFR Notice upon terms and conditions (including the purchase price) no more favorable to such Third Party Purchaser than those specified in the ROFR Notice, so long as any such sale is effected in accordance with any applicable securities Laws.  The Parties agree that any such Third Party Purchaser, prior to and as a condition to the consummation of any sale, shall execute and deliver to the Parties documents and other instruments assuming the obligations of such Transferor under this Agreement with respect to the Company ROFR Shares, and the transfer shall not be effective and shall not be recognized by any Party until such documents and instruments are so executed and delivered.

(vi)In the event the Transferor does not consummate the sale or disposition of any Company ROFR Shares pursuant to the terms set forth in Section 6.3(v), Sections 6.2 and 6.3 shall be re-invoked, as the case may be, and shall be applicable to any subsequent disposition until such rights lapse in accordance with the terms of this Agreement.

(vii)The exercise or non-exercise of the rights of the Company under Section 6.3 to purchase Equity Securities of the Company from a Transferor shall not adversely affect its rights to make subsequent purchases from the Transferor of Equity Securities of the Company by the Transferor hereunder.

(viii)Valuation of Property.

(a)Should the purchase price specified in the ROFR Notice be payable in property other than cash or evidences of indebtedness, the Company shall have the right to pay the purchase price in the form of cash equal in amount to the fair market value of such property.

(b)If the Transferor and the Company cannot agree on such cash value within the ROFR Option Period, the valuation shall be made by an appraiser of internationally recognized standing jointly selected by the Transferor and the Company or, if they cannot agree on an appraiser within the ROFR Option Period, each shall select an appraiser of internationally recognized standing and the two appraisers shall designate a third appraiser of internationally recognized standing, whose appraisal shall be determinative of such value.

(c)The cost of such appraisal shall be shared equally by the Transferor, on the one hand, and the Company, on the other hand.

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(d)If the value of the purchase price in the ROFR Notice is not determined within ROFR Option Period, the closing of the purchase of Company ROFR Shares by the Company shall be held on or prior to the fifth (5th) Business Day after such valuation shall have been made pursuant to this Section 6.3(viii).

6.4Right of Co-Sale

(i)To the extent the Company does not exercise its rights of first refusal as to all of the Company ROFR Shares proposed to be sold by the Transferor to the third party transferee identified in the ROFR Notice, each Preferred Shareholder shall have the right to participate in such sale, to the third party transferee identified in the ROFR Notice, of the Company ROFR Shares not purchased pursuant to Section 6.3, on the same terms and conditions as specified in the ROFR Notice (but in no event less favorable to the Transferor) by notifying the Transferor in writing within the ROFR Option Period (such Preferred Shareholder a “Selling Shareholder”).  Such Selling Shareholder’s notice to the Transferor shall indicate the number of Equity Securities the Selling Shareholder wishes to sell under its right to participate.  To the extent one or more Preferred Shareholders exercise such right of participation in accordance with the terms and conditions set forth below, the number of Equity Securities of the Company that the Transferor may sell in the Transfer shall be correspondingly reduced proportionally.

(ii)The total number of Equity Securities of the Company that each Selling Shareholder may elect to sell shall be equal to the product of (a) the aggregate number of the ROFR Shares being transferred following the exercise or expiration of all rights of first refusal pursuant to Section 6.3 hereof, multiplied by (b) a fraction, the numerator of which is the number of Ordinary Shares (assuming the exercise, conversion and exchange of all Ordinary Shares Equivalents) owned by such Selling Shareholder on the date of the ROFR Notice and the denominator of which is the total number of Ordinary Shares (assuming the exercise, conversion and exchange of all Ordinary Shares Equivalents) owned by the Transferor and all Selling Shareholders on the date of the ROFR Notice (the “Co-Sale Shares”).

(iii)Each Selling Shareholder shall effect its participation in the sale by promptly delivering to the Transferor for transfer to the Third Party Purchaser one or more executed instruments of transfer and share certificates, which represent the type and number of Equity Securities of the Company which such Selling Shareholder elects to sell; provided, however that if the Third Party Purchaser objects to the delivery of Equity Securities in lieu of Ordinary Shares, such Selling Shareholder shall only deliver Ordinary Shares (and therefore shall convert any such Equity Securities into Ordinary Shares) and certificates and instruments of transfer corresponding to such Ordinary Shares.  The Company agrees to make any such conversion concurrent with the actual transfer of such shares to the purchaser and contingent on such transfer.

(iv)The share certificate or certificates that a Selling Shareholder delivers to the Transferor pursuant to Section 6.4(iii) shall be transferred to the Third Party Purchaser and the register of members of the Company updated in consummation of the sale of the Equity Securities pursuant to the terms and conditions specified in the ROFR Notice, and the Transferor shall concurrently therewith remit to such Selling Shareholder that portion of the sale proceeds to which such Selling Shareholder is entitled by reason of its participation in such sale.

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(v)To the extent that any Third Party Purchaser prohibits the participation of a Selling Shareholder exercising its co-sale rights hereunder in a proposed Transfer or otherwise refuses to purchase shares or other securities from a Selling Shareholder exercising its co-sale rights hereunder, the Transferor shall not sell to such Third Party Purchaser any Equity Securities unless and until, simultaneously with such sale, the Transferor shall purchase from such Selling Shareholder such shares or other securities that such Selling Shareholder would otherwise be entitled to sell to the Third Party Purchaser pursuant to its co-sale rights for the same consideration and on the same terms and conditions as the proposed transfer described in the ROFR Notice.

(vi)Regardless of the foregoing, if the ROFR Shares are Preferred Shares, then a Selling Shareholder may only exercise its right of co-sale under this Section 6.4 and participate in such sale with shares of the same class and series as the class and series of the Offered Shares.

(vii)The exercise or non-exercise of the rights of the Shareholders to participate in the sale of Equity Securities by a Transferor pursuant to this Section 6.4 shall not adversely affect their rights to subsequently participate in sales of Equity Securities by such Shareholder.

6.5Drag Along Right

(i)Prior to a Qualified IPO, if the Management Holdcos Majority and the Preferred Shareholder Majority (the “Accepting Shareholders”), approve and notify the Company in writing of a proposed Share Sale or Deemed Liquidation Event, whether by way of merger, consolidation, sale of assets, control share acquisition or other transaction in which Control of the Company is transferred, which values the Company at or above US$300 million (each such event, a “Drag Along Event”), then the Company shall promptly notify each other Shareholder in writing of such approval and the material terms and conditions of such proposed Drag Along Event, whereupon each such Shareholder shall, in accordance with instructions received from the Company, vote all of such Shareholder’s voting Equity Securities of the Company in favor of, otherwise consent in writing to, and/or otherwise sell or transfer all of its Equity Securities in such Drag Along Event (including without limitation tendering original share certificates for transfer, signing and delivering share transfer certificates, share sale or exchange agreements, and certificates of indemnity relating to any shares in the event that such Shareholder has lost or misplaced the relevant share certificate) on the same terms and conditions as were agreed to by the Accepting Shareholders.

(ii)Each Shareholder agrees to make representations and warranties in connection with such proposed Drag Along Event regarding (a) ownership and authorization to sell the shares to be sold by itself and (b) no existence of any material violation as a result of such sale under any material agreement to which such Shareholder is a party.

(iii)Each Shareholder agrees to obtain any consents or approvals in order to facilitate to transfer its Equity Securities of the Company pursuant to Section 6.5(i) without significant expenses and to pay its pro rata share of expenses incurred in connection with the transaction contemplated pursuant to this Section 6.5.

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(iv)In furtherance of the foregoing, each such Shareholder agrees to, and the Company is hereby expressly authorized by each such Shareholder to take on such Shareholder’s behalf (without receipt of any further consent by such Shareholder), any or all of the following actions: (a) vote all of the voting Equity Securities of the Company of such Shareholder in favor of any such proposed Drag Along Event; (b) otherwise consent on such Shareholder’s behalf to such proposed Drag Along Event; (c) sell all of such Shareholder’s Equity Securities of the Company in such proposed Drag Along Event, in accordance with the terms and conditions of this Section 6.5 and/or (d) act as such Shareholder’s attorney-in-fact in relation to any such proposed Drag Along Event and have the full authority to sign and deliver, on behalf such Shareholder, share transfer certificates, share sale or exchange agreements and certificates of indemnity relating to any Shares in the event that such Shareholder has lost or misplaced the relevant share certificate.  Each Shareholder furthermore agrees to take all necessary actions in connection with the consummation of such Drag Along Event as reasonably requested by the Accepting Shareholders, including without limitation entering into all customary agreements and other documents as may be requested by the Accepting Shareholders to close the Drag Along Event.

6.6Legend.  Each existing or replacement certificate for Equity Securities of the Company now owned or hereafter acquired by any Shareholder other than a Preferred Shareholder shall bear the following legend:

“THE SALE, PLEDGE, HYPOTHECATION, ASSIGNMENT OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A SECOND AMENDED AND RESTATED SHAREHOLDERS’ AGREEMENT BY AND AMONG THE COMPANY AND CERTAIN HOLDERS OF SHARES OF THE COMPANY.  COPIES OF SUCH AGREEMENTS MAY BE OBTAINED UPON WRITTEN REQUEST TO THE COMPANY.”

7.Additional Agreements; Other Covenants.

7.1Registration Rights.

The Company hereby grants to the Shareholders such registration rights as set forth on Schedule IV.  In addition, the Company’s insider trading policy will provide that directors may implement 10b5-01 trading plans on a basis approved by the Preferred Shareholders.

7.2Stock Option Plan

(i)The Company has duly reserved 2,500,000 Class B Ordinary Shares (as adjusted for share splits and similar events) for issuance to employees or consultants of the Group pursuant to the ESOP. Any grant of awards under the ESOP shall be subject to the approval of the Compensation Committee.  The number of Class B Ordinary Shares reserved for ESOP may be increased with the approval of the Preferred Shareholder Majority.

(ii)All shares, options or other securities granted or issued under the ESOP shall be subject to a vesting schedule pursuant to which twenty-five percent (25%) of such shares or options shall vest on the one (1) year anniversary of such grant, with the remaining seventy-five

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(75%) to vest in equal monthly installments over the next thirty-six (36) months, expect as approved in writing by the Board of Directors including affirmative consents from each of the Preferred Shareholder Directors.  All Persons receiving shares or exercising options or other securities awarded under the ESOP shall be required and agreed in writing to be bound by the terms of this Agreement as a Shareholder.

(iii)The Company shall not, and the other Covenantors shall cause the Company not to, grant any awards pursuant to the ESOP to any grantee in the PRC if any authorization, consent, order or approval of any Governmental Authority or official that is necessary to effectuate such ESOP in the PRC in accordance with PRC Law has not been obtained.

7.3Compliance.  Each Covenantor shall cause each Group Company to use its best efforts to cause any direct or indirect Subsidiary or entity Controlled by the Company, including without limitation the Group Companies, whether now in existence or formed in the future, to comply in all material respects with all applicable Laws.  Without limiting the generality of the foregoing, each Group Company shall not, and the Management Parties shall cause the Company not to, and the Covenantors shall cause their respective Affiliates, officers, directors, employees, agents, and representatives not to, directly or indirectly, (i) offer, give, promise to give, or authorize the giving of anything of value to any officer, employee or any other person acting in an official capacity for any Government Entity to any political party or official thereof or to any candidate for political office (individually and collectively, a “Government Official”) or to any person under circumstances where there is knowledge or awareness of a high probability that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to any Government Official, with the intent of obtaining any improper advantage, affecting or influencing any act, decision, or omission of any such Person, assisting any Group Company in obtaining or retaining business for, or with, or directing business to, any Person, or constituting a bribe, kickback or illegal or improper payment to assist any Group Company in obtaining or retaining business for or with, or directing business to the Group Company or any of its subsidiaries or in connection with receiving any approval of the transactions contemplated herein, (ii) take any other action, in each case, in violation of the Foreign Corrupt Practices Act of the United States of America, as amended (as if it were a U.S. Person), the United Kingdom Bribery Act, as amended, or any other applicable similar anti-corruption, anti-bribery, recordkeeping and internal controls Laws, including, without limitation, using any corporate funds for any unlawful contribution, gift, entertainment or other unlawful payments to any foreign or domestic Governmental Official or employee from corporate funds or (iii) establish or maintain any fund or assets in which any Group Company has proprietary rights that have not been recorded in the books and records of such Group Company.

7.4Compliance Program.

(i)The Covenantors shall and shall cause the Company to, as soon as practicable and in any event no later than one hundred and twenty (120) days following the date hereof, adopt and implement (a) an anti-corruption policy and (b) effective disclosure controls and procedures and an internal accounting controls system in each case in form and substance to the reasonable satisfaction of each of the Preferred Shareholders.  Following the adoption and implementation of the foregoing, the Covenantors shall conduct, or shall have conducted by a third party,

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periodic anti-corruption policy training for the employees of the Group Companies so as to the greatest extent possible detect and deter any violations of Anti-Corruption Laws.

(ii)The Covenators shall notify each of the Preferred Shareholders of any violation or potential violation of Anti-Corruption Laws, U.S. Economic Sanction, or Money Laundering Law by the Company or its Affiliates, or any of their agents.

7.5OFAC. The Company will not directly or indirectly use the proceeds of the transactions contemplated by the Transaction Documents, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other Person for the purpose of funding or facilitating any activities or business of or with any Person towards any sales or operations in Cuba, Iran, Libya, Syria, Sudan, the Democratic People’s Republic of Korea, Myanmar or any other country sanctioned by OFAC or for the purpose of funding any operations or financing any investments in, or make any payments to, any Person, entity, or government listed on the Office of Foreign Assets Control’s (“OFAC”) “Specially Designated National and Blocked Person List” (“SDN List”) or otherwise subject to any sanction administered by OFAC (“U.S. Economic Sanctions”).  The use of proceeds will be in compliance with and will not result in the breach by any Relevant Person of the U.S. Economic Sanctions; and the Company further covenants not to engage, directly or indirectly, in any other activities that would result in a violation of U.S. Economic Sanctions by any person, including any person participating in the transactions contemplated by the Transaction Documents.

7.6Money Laundering Laws.  The Company and Covenantors shall procure that the operations of the Company and its Subsidiaries shall be conducted at all times in compliance with applicable anti-money laundering statutes of all jurisdictions, including, without limitation, all PRC and U.S. anti-money laundering laws, the rule and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental or regulatory agency (collectively, the “Money Laundering Laws”).

7.7PRC Matters.

(i)The Covenantors shall ensure that all filings and registrations with the relevant PRC Governmental Authorities required in respect of the Group Companies and the Management Parties, including the registrations with the Ministry of Commerce (or any predecessors), the Ministry of Industry and Information Technology, the State Administration of Industry and Commerce, the State Administration of Foreign Exchange (“SAFE”), tax bureau, customs authorities, product registration authorities, health regulatory authorities and the local counter part of each of the aforementioned governmental authorities, as applicable, shall be duly completed in accordance with the relevant Laws.

(ii)If any Shareholder or beneficiary owner of shares of the Company, including, without limitation, Ordinary Shares and Preferred Shares, or any other Equity Securities (each, a “Company Security Holder”) is a “Domestic Resident” as defined in Circular 37 issued by SAFE on July 4, 2014 (“Circular 37”) and is subject to the SAFE registration or reporting requirements under Circular 37, in each case as determined by the Board of Directors or counsel to the Company, the Company shall and the Management Parties shall cause the Company to promptly obtain a power of attorney reasonably satisfactory to the Preferred Shareholder

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Majority from such Company Security Holder, and the Company shall and the Management Parties shall cause the Company to cause the designated representative under such power of attorney to take such actions and execute such instruments on behalf of such Company Security Holder to comply with the applicable SAFE registration or reporting requirements under Circular 37 as determined in the sole discretion of the Board of Directors or counsel to the Company.  The Group Companies and the Management Parties shall fully comply with all applicable PRC Laws relating to the filing, registration and reporting to SAFE or any of its local branches with respect to any foreign exchange transactions, investments, changes or occurrence of significant events.

(iii)The Parties hereby acknowledge and agree that, as part of the consideration for the Preferred Shareholders’ subscription of Preferred Shares and other valuable consideration, the Company and any of its current or future Subsidiaries have the option, exercisable by the Company or any of its current or future wholly-owned Subsidiaries, as the case may be, at any time (provided that such purchase by the Company or any of its current or future wholly-owned Subsidiaries is permitted under the then applicable Laws of the PRC) to purchase or transfer to the Company or any of its current or future wholly-owned Subsidiaries the entire equity interest of any Controlled Entity from the shareholders of such Controlled Entity at the lowest amount permitted under the then applicable Laws of the PRC.  The parties further agree to effect such transfer of equity interest in the Controlled Entity upon receipt of the written request of the Preferred Shareholder Majority, provided that such transfer shall at the time of such request be permissible under the then applicable Laws of the PRC.

7.8Memorandum and Articles.  In the event of any conflict or inconsistency between any of the terms of this Agreement and any of the terms of the Memorandum and Articles, the terms of this Agreement shall prevail in all respects, the Parties shall give full effect to and act in accordance with the provisions of this Agreement over the provisions of the Memorandum and Articles, and the Parties hereto shall exercise all voting and other rights and powers (including to procure any required alteration to the Memorandum and Articles to resolve such conflict or inconsistency) to make the provisions of this Agreement effective.

7.9Employment Matters.  As soon as reasonably practicable and unless otherwise determined by the Preferred Shareholder Majority, the Company shall, and the other Covenantors shall cause the Company to, require all employees and consultants now or hereafter employed or retained by any Group Company to enter into a confidential information, invention assignment, non-compete and non-solicitation agreement requiring such Persons to protect and keep confidential each Group Company’s confidential information, intellectual property and trade secrets, prohibiting such Persons from competing with the Group Companies during their tenure with any Group Company, prohibiting such employees from soliciting the employees and consultants of the Group Companies for a reasonable time after their tenure with any Group Company, and requiring such employees to assign all ownership rights in their work product to the Group Companies to the maximum extent permitted by applicable Law.

7.10Key Person Insurance.  The Board shall determine the appropriate level of key person life insurance, under which the Company shall be the sole beneficiary.

7.11        Non-compete.

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(i)Each of the Management Shareholders hereby undertakes, and the Covenantors shall cause each of the Key Employees to undertake, to the Company and the Preferred Shareholders that for as long as he is employed by any Group Company and a period of two (2) years thereafter (“Non-competition Period”), he will not, without the prior written consent of the Preferred Shareholder Majority, either on his own account or through any of his Affiliates or in conjunction with or on behalf of any other Person:

(a)Carry on or be engaged, concerned or interested directly or indirectly whether as shareholder (other than as a holder of less than 1% of the outstanding capital stock of a public traded company), director, employee, partner, agent or otherwise carry on any business in direct competition with the primary business then operated by the Company in the PRC and any other geographic territory in which the Company then actively operates;

(b)Solicit or entice away or attempt to solicit or entice away from any Group Company, the custom of any person, firm, company or organization who is or shall at any time within twelve (12) months prior to such cessation have been a customer, client, representative, agent or correspondent of such Group Company or in the habit of dealing with such Group Company; or

(c)Employ, solicit or entice away or attempt to employ, solicit or entice away from any Group Company any person who is or shall have been at the date of or within twelve (12) months prior to such cessation an officer, manager, consultant or employee of any such Group Company whether or not such person would commit a breach of contract by reason of leaving such employment (other than pursuant to advertisements of general circulation).

(ii)Each of the Management Shareholders hereby undertakes, and the Covenantors shall cause each of the Key Employees to undertake, to the Company and the Preferred Shareholders that neither he nor any of his Affiliates will at any time hereafter, in relation to any trade, business or company, use in contravention of Law any business or trade name or any permutation, combination, derivation or part thereof now or hereafter used by any Group Company in its name or in the name of any of its products, services or their derivative terms, or the Chinese or English equivalent or any similar word in such a way as is likely to be confused with the name of any Group Company or the product or services or any other products or services of any Group Company, and shall use all reasonable endeavors to procure that no such name shall be used by any of his Affiliates.

(iii)Each and every obligation under this Section 7.11 shall be treated as a separate obligation and shall be severally enforceable as such and in the event of any obligation or obligations being or becoming unenforceable in whole or in part, such part or parts which are unenforceable shall be deleted from such section and any such deletion shall not affect the enforceability of the remainder parts of such section.

(iv)If any restrictions in this Section 7.11 shall be adjudged to be invalid or unenforceable as being in excess of what is reasonably required for the protection of the Group or the Shareholders, but would be valid if parts of this Section 7.11 were deleted or the scope herein reduced, all restrictions in this Section 7.11 shall apply with such modifications as may be necessary to make them legally valid and effective.

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(v)The Management Shareholders hereby covenant that each of them shall continue to devote all of his working time to managing the business and operations of the Group, and shall not, without the prior written consent of the Preferred Shareholder Majority, either on his own account or through any of his Affiliates, or in conjunction with or on behalf of any other Person, (a) possess, directly or indirectly, the power to direct or cause the direction of the management and business operation of any other entity (A) through the ownership of any equity interest in such entity, (B) by occupying half or more of the board seats of such entity, or (C) by contract or otherwise; or (b) devote time to carry out the business operation of any other entity.

7.12Public Dissemination Right.  The Company shall keep the Preferred Shareholders informed, on a current basis, of any events, discussions, notices or changes with respect to any Tax (other than ordinary course communications which could not reasonably be expected to be material to the Group Company), criminal or regulatory investigation or action involving the Group Company, so that the Preferred Shareholders will have the opportunity to take appropriate steps to avoid or mitigate any regulatory consequences to them that might arise from such criminal or regulatory investigation or action and the Company shall reasonably cooperate with the Preferred Shareholders, their members and their respective Affiliates in an effort to avoid or mitigate any cost or regulatory consequences that might arise from such investigation or action (including by reviewing written submissions in advance, attending meetings with authorities, coordinating and providing assistance in meeting with regulators and, if requested by any of the Preferred Shareholder, making a public announcement of such matters).

7.13Confidentiality.

(i)Disclosure. The terms and conditions of the Transaction Documents (collectively, the “Financing Terms”), including their existence, shall be considered confidential information and shall not be disclosed by any of the Parties to any other Person except in accordance with the provisions set forth below.

(ii)Permitted Disclosures.  Notwithstanding the foregoing, (i) each member of the Group and each Preferred Shareholder, as appropriate, may disclose any of the Financing Terms to its current or bona fide prospective partners, investors or transferees, Affiliates and its and their respective, shareholders, business partners, investment advisers, employees, directors, officers, investment bankers, lenders, accountants, auditors, attorneys or representatives or advisors who need to know such information, and solely for their own use, in each case only where such Persons are under appropriate nondisclosure obligations; and (ii) each Preferred Shareholder may disclose any of the Financing Terms to its fund manager and the directors, officers and employees thereof so long as such Persons are under appropriate nondisclosure obligations.

(iii)Legally Compelled Disclosure.  In the event that any Party is requested or becomes legally compelled (including without limitation, pursuant to any legal process or a subpoena, civil investigation demand (or similar process), order, statute, rule, request or other legal or similar requirement made, promulgated or imposed by a court or by a judicial, regulatory, self-regulatory (including stock exchange) or legislative body, organization, commission, agency or committee or otherwise in connection with any judicial or administrative

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proceeding (including, in response to oral questions, interrogatories or requests for information or documents) to disclose the existence or content of any of the Financing Terms hereof in contravention of the provisions of this Section 7.13, such Party (the “Disclosing Party”) shall promptly provide the other Parties with written notice of that fact so that such other Parties may seek a protective order, confidential treatment or other appropriate remedy.  In such event, the Disclosing Party shall furnish only that portion of the information that is legally required and shall exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such information to the extent reasonably requested by the other Parties.

(iv)Other Exceptions.  Notwithstanding any other provision of this Section 7.13, the confidentiality obligations of the Parties shall not apply to: (i) information which a restricted Party learns from a third party having the right to make the disclosure, provided the restricted Party complies with any restrictions imposed by the third party; (ii) information which is in the restricted Party’s possession prior to the time of disclosure by the protected Party and not acquired by the restricted Party under a confidentiality obligation; (iii) information which enters the public domain without breach of confidentiality by the restricted Party; (iv) disclosures to a Party’s accountants and attorneys so long as they agree to keep such disclosures confidential or (v) information to any person to which disclosure is approved in writing by the party providing the information.

7.14Press Releases.  None of the Parties hereto shall issue a press release or make any public announcement or other public disclosure with respect to any of the transactions contemplated herein without obtaining the prior written consent of each Preferred Shareholder or use the name of the Preferred Shareholder (including but not limited to Goldman, Sachs & Co., or any Affiliate of GS) without obtaining in each instance the prior written consent of such Preferred Shareholder.

7.15No Promotion.  The Parties agree that it will not, without the prior written consent of the applicable Affiliate of GS, in each instance, (i) use in advertising, publicity, or otherwise the name of Goldman, Sachs & Co., or any Affiliate of GS, or any partner or employee of a Affiliate of GS, nor any trade name, trademark, trade device, service mark, symbol or any abbreviation, contraction or simulation thereof owned by Goldman, Sachs & Co. or its affiliates, or (ii) represent, directly or indirectly, that any product or any service provided by the Company has been approved or endorsed by Goldman, Sachs & Co. or an Affiliate of GS.  The Parties further agree that it shall obtain the written consent from the applicable Affiliate of GS prior to the issuance of any public statement detailing such Affiliate of GS’s purchase of shares pursuant to this Agreement.

7.16Use of Logo.  The Company shall grant the Preferred Shareholders and their respective Affiliates permission to use the Company’s name and logo in its or its Affiliate’s marketing materials and bid documentation in relation to potential transactions.  The Company shall not, and shall procure that none of its Subsidiaries or its or their respective directors, officers, employees, agents or other representatives will, directly or indirectly use or refer to any Preferred Shareholder’s name, or any derivation thereof, for any purpose whatsoever (including, without limitation, in filing with any governmental authority, any press release, any public announcement or statement or in any interview or other discussion with any reporter or other

31

member of the media) without the prior written consent of such Preferred Shareholder with respect to each such use or reference.

8.Tax Matters.

8.1Each Group Company shall not, and the Management Parties shall cause each Group Company not to, take any action inconsistent with the treatment of the relevant Group Company as a corporation for U.S. federal income tax purposes and each Group Company shall not, and the Management Parties shall cause each Group Company not to, elect to be treated as an entity other than a corporation for U.S. federal income tax purposes.  Upon notification by any Preferred Shareholder that any Group Company should elect to be classified as a partnership or disregarded entity for U.S. federal income tax purposes (the “Partnership Election”), and with the written consent of each other Preferred Shareholder that is either a United States Person or has owners who are Indirect US Investors (which consent may be withheld in each such Preferred Shareholder’s sole discretion), the Company shall make, or shall cause to be made, the “Partnership Election” by filing, or by causing to be filed, Internal Revenue Service Form 8832 (or any successor form), and the Company shall not permit the Partnership Election to be terminated or revoked without the written consent of each Preferred Shareholder.

8.2Each Group Company and Management Parties shall use their best efforts to arrange the management and business activities of each Group Company in such a way that none of the Group Companies is treated as a resident for tax purposes of or is subject to income tax in a jurisdiction other than the jurisdiction in which it has been organized.

8.3Each Group Company and Management Parties shall use their best efforts to avoid future status of any Group Company as a PFIC.  Within forty-five (45) days from the end of each taxable year of the Company, each Group Company shall, and the Management Parties shall cause each Group Company to determine, in consultation with a reputable accounting firm, whether any Group Company was a PFIC in such taxable year (including whether any exception to PFIC status may apply).  If any Group Company or Management Parties determines that any Group Company was a PFIC in such taxable year (or if a Government Authority or a Preferred Shareholder informs a Group Company that it has so determined), the Group Company or Management Parties, as relevant, shall, within sixty (60) days from the end of such taxable year, provide the following information to each Preferred Shareholder that is a United States Person and each United States Person that holds either direct or indirect interest in a Preferred Shareholder (“Indirect US Investor”) (hereinafter, collectively referred to as a “PFIC Shareholder”): (i) all information available to the relevant Group Company as a PFIC Shareholder may request to permit such PFIC Shareholder to (a) accurately and timely prepare its U.S. tax returns and comply with any other reporting requirements, if any, arising from its investment in the Group Company and relating to the relevant Group Company’s classification as a PFIC and (b) make any election (including, without limitation, a “qualified electing fund” election under Section 1295 of the Code), with respect to the relevant Group Company; and (ii) a completed “PFIC Annual Information Statement” as described in Treasury Regulation Section 1.1295-1(g) and attached hereto as Exhibit A.  A Group Company shall be required to provide the information described above to an Indirect US Investor only if a Preferred Shareholder requests in writing that the Group Company provide such information to such Indirect US

32

Investor and furnishes the Group Company with written identifying information (such as name, address, and other identifying information) about the Indirect US Investor.

8.4Each shareholder of each Group Company (except for the Preferred Shareholder) represents (i) that it is not a United States Person, and (ii) that it is not owned, wholly or in part, directly or indirectly, by any United States Person.  Each shareholder of each Group Company (other than the Preferred Shareholder) shall provide prompt written notice to the relevant Group Company, and the Group Company shall in turn provide prompt written notice to the Preferred Shareholder, of any subsequent change in United States Person status in their shareholders.  Each Group Company represents that, (i) other than the Preferred Shareholder, it does not have any direct or indirect shareholders that are United States Persons, and (ii) it is not currently a CFC and shall not be a CFC immediately following the transactions contemplated by the Transaction Documents and it shall use its best efforts to avoid future status of the Company or any of its subsidiaries as a CFC.  Within 45 days from the end of each taxable year, each Group Company shall determine, in consultation with a reputable accounting firm, whether it is a CFC.  Each Group Company shall provide to any Preferred Shareholder upon request (i) any information in its possession concerning its shareholders and, to the Group Company’s actual knowledge, the direct and indirect interest holders in each shareholder, sufficient for the Preferred Shareholder to determine whether or not such Group Company is a CFC; and (ii) in the event any Group Company is determined to be a CFC, any information reasonably requested by the Preferred Shareholder in connection with complying with applicable reporting requirements for U.S. tax purposes.  The Management Parties and all Group Companies shall use their best efforts to avoid generating for any taxable year in which any Group Company is a CFC, income that would be includible in the income of the Preferred Shareholder (or any Indirect US Investor) pursuant to Section 951 of the Code.

8.5The Company shall comply, and the Management Parties shall cause all Group Companies to comply, with all record-keeping, reporting, and other requirements that the Preferred Shareholders informs the Company are necessary to enable the Preferred Shareholders to comply with any applicable U.S. tax rules.  The Company shall, and the Management Parties shall cause all Group Companies to, also provide each Preferred Shareholder with any information reasonably requested by such Preferred Shareholder to enable the Preferred Shareholder to comply with any applicable U.S. tax rules.

8.6On or prior to the first (1st) anniversary of the date hereof (the “First Anniversary Date”), the Company shall retain an internationally recognized accounting firm acceptable to the Preferred Shareholders to review the adequacy of its transfer pricing policies and current allocation of assets and employees as among the Group Companies and to provide a report (the “Report”) with recommendations to implement with a view to (i) ensuring consolidation of the accounts of the Controlled Entities in the consolidated financials of the Company, and (ii) effecting an underwritten initial public offering of securities on a US stock exchange.  Following receipt of the Report and prior to the First Anniversary Date, the Company shall use its commercially reasonable best efforts to implement all of the recommendations therein.

8.7The cost incurred by any Group Company in providing the information that it is required to provide, or is required to cause to be provided, and the cost incurred by the Group

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Company in taking the action, or causing the action to be taken, as described in this Section 8 shall be borne by the relevant Group Company.

8.8The Company and each Management Parties agree to jointly and severally indemnify and hold harmless the Preferred Shareholders from and against any taxes imposed on the Preferred Shareholders by any PRC Government Authority in connection with its purchase of Shares of the Company.

9.Termination

This Agreement and all rights and covenants contained herein, including but not limited to those contained in Sections 2, 3, 4, 5, 6 and 8 (with the exception of the Registration Rights granted under Section 7.1), shall terminate on the earlier of (a) the closing of a Qualified IPO, (b) with respect to each Shareholder, the date on which such Shareholder no longer holds any Equity Securities in the Company and (c) any date agreed upon in writing by all of the Parties, in each case, provided that the termination shall be without prejudice to any accrued rights the Parties may have.

10.Miscellaneous.

10.1Further Assurances.  Upon the terms and subject to the conditions herein, each of the Parties hereto agrees to use its best efforts to take or cause to be taken all action, to do or cause to be done, to execute such further instruments, and to assist and cooperate with the other Parties hereto in doing, all things necessary, proper or advisable under applicable Laws or otherwise to consummate and make effective, in the most expeditious manner practicable, the transactions contemplated by this Agreement and, to the extent reasonably requested by another Party, to enforce rights and obligations pursuant hereto.

10.2Assignments and Transfers.  Except as otherwise provided herein, this Agreement and the rights and obligations of the Parties hereunder shall inure to the benefit of, and be binding upon, their respective successors, assigns and legal representatives.  The rights of any Preferred Shareholder hereunder (including, without limitation, registration rights) are assignable in connection with the transfer (subject to applicable securities Laws and other Laws) of Equity Securities of the Company held by such Preferred Shareholder but only to the extent of such transfer, and any such transferee shall execute and deliver to the Company and the other parties hereto a deed of adherence in the form attached hereto as Exhibit B becoming a party hereto as an “Preferred Shareholder” subject to the terms and conditions hereof.  This Agreement and the rights and obligations of any party hereunder shall not otherwise be assigned without the mutual written consent of the other Parties; provided that each Preferred Shareholder may assign any or all of its rights and obligations to an Affiliate of such Preferred Shareholder (including, without limitation, its Permitted Transferees) without consent of the other parties under this Agreement.

10.3Governing Law.  This Agreement shall be governed by and construed under the Laws of Hong Kong, without regard to principles of conflict of laws thereunder.

10.4Dispute Resolution.

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(i)Any dispute, controversy or claim arising out of, in connection with or relating to this Agreement, including the interpretation, validity, invalidity, breach or termination thereof, shall be settled by arbitration.

(ii)The arbitration shall be conducted in Hong Kong under the Hong Kong International Arbitration Centre Administered Arbitration Rules in force when the notice of arbitration is submitted in accordance with the said Rules.  The language of arbitration shall be English and the number of arbitrators shall be three.

(iii)Each party shall cooperate with the other in making full disclosure of and providing complete access to all information and documents requested by the other in connection with such arbitration proceedings, subject only to any doctrine of legal privilege or any confidentiality obligations binding on such party.

(iv)The costs of arbitration shall be borne by the losing party, unless otherwise determined by the arbitration tribunal.

(v)When any dispute occurs and when any dispute is under arbitration, except for the matters in dispute, the parties shall continue to fulfill their respective obligations and shall be entitled to exercise their rights under this Agreement.

(vi)The award of the arbitration tribunal shall be final and binding upon the parties, and the prevailing party may apply to a court of competent jurisdiction for enforcement of such award.

(vii)Regardless of anything else contained herein, either party shall be entitled to seek preliminary injunctive relief from any court of competent jurisdiction pending the conclusion of the arbitration.

10.5Notices.  Any notice required or permitted pursuant to this Agreement shall be given in writing and shall be given either personally or by sending it by next-day or second-day courier service, fax, electronic mail or similar means to the address as shown below the signature of such party on Schedule V (or at such other address as such party may designate by fifteen (15) days’ advance written notice to the other parties to this Agreement given in accordance with this Section 10.5).  Where a notice is given personally, delivery shall be deemed to have been effected on receipt (or when delivery is refused).  Where a notice is sent by next-day or second-day courier service, service of the notice shall be deemed to be effected by properly addressing, pre-paying and sending by next-day or second-day service through an internationally-recognized courier a letter containing the notice, with a confirmation of delivery, and to have been effected on receipt (or when delivery is refused).  Where a notice is sent by fax or electronic mail, service of the notice shall be deemed to be effected by properly addressing, and sending such notice through a transmitting organization, with a written confirmation of delivery, and to have been effected on the day the same is sent as aforesaid if sent during normal business hours of the recipient, otherwise on the next Business Day.

10.6Rights Cumulative.  Each and all of the various rights, powers and remedies of a Party hereto will be considered to be cumulative with and in addition to any other rights, powers and remedies which such Party may have at law or in equity in the event of the breach of any of

35

the terms of this Agreement.  The exercise or partial exercise of any right, power or remedy will neither constitute the exclusive election thereof nor the waiver of any other right, power or remedy available to such Party.

10.7Severability.  In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.  If, however, any provision of this Agreement shall be invalid, illegal, or unenforceable under any such applicable Law in any jurisdiction, it shall, as to such jurisdiction, be deemed modified to conform to the minimum requirements of such Law, or, if for any reason it is not deemed so modified, it shall be invalid, illegal, or unenforceable only to the extent of such invalidity, illegality, or limitation on enforceability without affecting the remaining provisions of this Agreement, or the validity, legality, or enforceability of such provision in any other jurisdiction.

10.8Amendments and Waivers.  Subject to Section 3 of this Agreement, any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of each of (i) the Company, (ii) the Management Holdcos Majority, and (iii) the Preferred Shareholder Majority, provided that, if any such amendment or waiver will, or is reasonably be expected to, have an adverse impact on the rights and entitlements of any particular class of the Preferred Shares, then the written consent of the majority in voting power of the then issued and outstanding Preferred Shares of that particular class shall also be obtained.  Any amendment or waiver effected in accordance with this paragraph shall be binding upon each of the Parties hereto.

10.9No Waiver.  Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof will not be deemed a waiver of such term, covenant, or condition, nor will any waiver or relinquishment of, or failure to insist upon strict compliance with, any right, power or remedy hereunder at any one or more times be deemed a waiver or relinquishment of such right, power or remedy at any other time or times.

10.10Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any Party under this Agreement, upon any breach or default of any other Party under this Agreement, shall impair any such right, power or remedy of such non-breaching or non-defaulting Party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring.  Any waiver, permit, consent or approval of any kind or character on the part of any Party of any breach or default under this Agreement, or any waiver on the part of any Party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing.  All remedies, either under this Agreement or by law or otherwise afforded to any Party, shall be cumulative and not alternative.

10.11No Fiduciary Duty. The Parties hereto acknowledge and agree that nothing in this Agreement or the Transaction Documents shall create a fiduciary duty of Goldman Sachs & Co. or any Affiliate of GS to the Company or its shareholders.

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10.12Investment Banking Services. Notwithstanding anything to the contrary herein or in the Transaction Documents or any actions or omissions by representatives of Goldman, Sachs & Co. or any of its Affiliates in whatever capacity, including as a director or observer to the Company’s Board of Directors, it is understood that neither Goldman, Sachs & Co. nor any of its Affiliates is acting as a financial advisor, agent or underwriter to the Company or any of its Affiliates or otherwise on behalf of the Company or any of its Affiliates unless retained to provide such services pursuant to a separate written agreement.

10.13Exculpation among Investors. Each Investor agrees that no Investor nor the respective controlling persons, officers, directors, partners, agents, or employees of any Investor shall be liable to any other Investor for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the purchase of the Series C Preferred Shares.

10.14Adequate Representation.  The Parties acknowledge that each Party has been adequately represented by counsel in connection with this Agreement.

10.15Headings and Subtitles; Interpretation.  The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.  Unless a provision hereof expressly provides otherwise:  (i) the term “or” is not exclusive; (ii) words in the singular include the plural, and words in the plural include the singular; (iii) the terms “herein”, “hereof”, and other similar words refer to this Agreement as a whole and not to any particular section, subsection, paragraph, clause, or other subdivision; (iv) the term “including” will be deemed to be followed by “, but not limited to,”; (v) the masculine, feminine, and neuter genders will each be deemed to include the others; (vi) the terms “shall”, “will”, and “agrees” are mandatory, and the term “may” is permissive; (vii) the term “day” means “calendar day”; (viii) all references to dollars or to “US$” are to currency of the United States of America (and shall be deemed to include reference to the equivalent amount in other currencies); and (ix) all references to Renminbi or to “RMB” are to currency of the PRC (and shall be deemed to include reference to the equivalent amount in other currencies).

10.16Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Facsimile and e-mailed copies of signatures shall be deemed to be originals for purposes of the effectiveness of this Agreement.

10.17Entire Agreement.  This Agreement (including the Exhibits and Schedules hereto) constitutes the full and entire understanding and agreement among the Parties with regard to the subjects hereof and thereof, and supersedes all other agreements between or among any of the Parties with respect to the subject matter hereof (including the Prior Agreement).  After the execution and delivery of this Agreement, to the extent that there is any conflict between this Agreement and any provision of any other agreement, arrangement or understanding between the Company and any holder of equity securities of the Company, the terms and conditions of this Agreement shall prevail.

10.18Aggregation of Stock.  All Shares held or acquired by any Affiliates shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

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10.19Future Shareholders.  The Covenantors and the Management Parties shall cause each of the officers, directors and Key Employees of the Company who holds any Equity Securities of the Company and each other holder of more than one percent (1%) of the Company’s Ordinary Shares (calculated on a fully-diluted and as converted basis) (other than any Preferred Shareholders in future financings of the Company) to enter into this Agreement and become subject to the terms and conditions hereof as Shareholder.  The Parties hereby agree that such Person shall become a party to this Agreement by executing a counterpart of this Agreement, without any amendment of this Agreement, or any consent or approval of any other party.

[The remainder of this page has been intentionally left blank.]

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IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

COMPANY:	GRIDSUM HOLDING INC.
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Director
HK HOLDCO:	GRIDSUM HOLDING (CHINA) LIMITED
	(國雙控股（中國）有限公司)
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Director
WFOE:	DISSECTOR (BEIJING) TECHNOLOGY CO. LTD.
	(迪塞克特（北京）科技有限公司)
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Legal Representative
BEIJING GRIDSUM:	BEIJING GRIDSUM CO., LTD.
	(北京国双科技有限公司)
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Legal Representative
BEIJING MOMENT:	BEIJING MOMENT EVERLASTING AD CO., LTD.
	(北京千里日成广告有限公司)
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Legal Representative

S-1

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

GUOXINJUNHE:	GUOXINJUNHE (BEIJING) TECHNOLOGY CO., LTD.
	(国信君和（北京）科技有限公司)
	By:	/s/Xu Yang
		Name: Xu Yang
		Title: Legal Representative
BEIJING YUNYANG:	BEIJING YUNYANG AD CO., LTD.
	(北京云洋广告有限公司)
	By:	/s/Li Feng
		Name: Li Feng
		Title: Legal Representative
GRIDSUM HOLDCO:	GRIDSUM HOLDING (BEIJING) CO., LTD.
	(国双控股（北京）有限公司)
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Legal Representative
EMPLOYEE HOLDCO:	FAIRY SPIRIT LIMITED
	By:	/s/Qi Guosheng
		Name: Qi Guosheng
		Title: Director

S-2

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

EMPLOYEE HOLDCO:

TOM MELCHER REVOCABLE TRUST
By:	/s/Tom Melcher
	Name: Tom Melcher
	Title:Trustee

S-3

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

MANAGEMENT SHAREHOLDERS:

QI GUOSHENG (祁国晟)

/s/Qi Guosheng

YU GUOFA (于国法)

/s/Yu Guofa

S-4

IN WITNESS WHEREOF, the Parties have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

MANAGEMENT HOLDCOS:

GENERATION GOSPEL LIMITED
By:	/s/Qi Guosheng
	Name: Qi Guosheng
	Title: Director
GARDEN ENTERPRISES LTD.
By:	/s/Yu Guofa
	Name: Yu Guofa
	Title: Director

S-5

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

STEAMBOAT VENTURES ASIA, L.P.
By: Steamboat Ventures Asia Manager, L.P.
Its: General Partner
By: Steamboat Ventures Asia GP, Ltd.
Its: General Partner
By:	/s/Liping Fan
	Name: Liping Fan
	Title: Director

S-6

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

NOKIA GROWTH PARTNERS II, L.P.
By:	/s/John Gardner
	Name: John Gardner
	Title: Managing Partner

S-7

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

QUANTUM STRATEGIC PARTNERS LTD.
By:	/s/ Maryann Canfield
	Name: Maryann Canfield
	Title:

S-8

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

RAINBOW CASTLE HOLDINGS LIMITED
By:	/s/Ning Cong
	Name: Ning Cong
	Title: Director

S-9

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

UVM 2 VENTURE INVESTMENTS LP ACTING THROUGH ITS GENERAL PARTNER UOB BIOVENTURES MANAGEMENT PTE LTD
By:	/s/ Mark Yeo Wee Tiong
	Name: Mark Yeo Wee Tiong
	Title: Executive Director

S-10

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

BROAD STREET INVESTMENTS HOLDING (SINGAPORE) PTE. LTD.
By:	/s/Ong Woon Sing
	Name: Ong Woon Sing as Alternate
	Title: Director to Hay Pung Chan Rithy

S-11

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

ASEAN China Investment Fund II L.P.
By:	/s/Mark Yeo Wee Tiong
	Name: Mark Yeo Wee Tiong
	Title: Executive Director

S-12

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

VLTCM Ltd.
By:	/s/Andrea D. Fesslek
	Name: Andrea D. Fesslek
	Title: Director

S-13

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

PA Venture Opportunity VII Limited
By:	/s/John Robert Lewis
	Name: John Robert Lewis
	Title:

S-14

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

Moon Capital Master Fund Ltd.
By:	/s/David Sobol
	Name: David Sobol
	Title: General Counsel
Moon Capital Partners Master Fund Ltd.
By:	/s/David Sobol
	Name: David Sobol
	Title: General Counsel

S-15

IN WITNESS WHEREOF, the parties hereto have executed this Second Amended and Restated Shareholders’ Agreement as of the date first written above.

PREFFERED SHAREHOLDER:

Bridge Street 2015, L.P.
By:	/s/Scott Kilpatrick
	Name: Scott Kilpatrick
	Title: Vice President
MBD 2015, L.P.
By:	/s/Scott Kilpatrick
	Name: Scott Kilpatrick
	Title: Vice President
Stone Street 2015, L.P.
By:	/s/Scott Kilpatrick
	Name: Scott Kilpatrick
	Title: Vice President
2015 Employee Offshore Aggregator, L.P.
By:	/s/Scott Kilpatrick
	Name: Scott Kilpatrick
	Title: Vice President

S-16

Exhibit A

PFIC ANNUAL INFORMATION STATEMENT

[Must be signed by an authorized representative of the Company]

PFIC Annual Information Statement pursuant to U.S. Treasury Regulation § 1.1295-1(g).

(the “Company”) hereby represents that:

1.This PFIC Annual Information Statement applies to the Company’s taxable year beginning on          and ending on          .

2.The pro rata shares of the Company’s ordinary earnings and net capital gain attributable to the PFIC Shareholder for the taxable year specified in paragraph (1) are:

Ordinary Earnings:  $

Net Capital Gain:  $

3.The amount of cash and the fair market value of other property distributed or deemed distributed by the Company to the PFIC.  Shareholder during the taxable year specified in paragraph (1) are as follows:

Cash:  $

Fair Market Value of Property:  $

4.The Company will permit the PFIC Shareholder to inspect the Company’s permanent books of account, records, and such other documents as may be maintained by the Company that are necessary to establish that the Company’s ordinary earnings and net capital gain are computed in accordance with U.S. Federal income tax principles, and to verify these amounts and the PFIC Shareholders direct or indirect pro rata shares thereof; provided, that (i) a Company representative shall, at the Company’s option, accompany the Preferred Shareholder on any such inspection, and (ii) the Company shall not be required to permit such inspection if such inspection would violate applicable Laws, regulations or policies of the PRC or [                                             ].

By:

Title:

Date:

Exhibit B

FORM DEED OF ADHERENCE

THIS DEED OF ADHERENCE is made the                         day of

by [    ], (“New Shareholder”)

RECITALS

A.On                                               ,                      , the shareholders of [                                ] (the “Company”) entered into a second amended and restated shareholders’ agreement, as amended from time to time (the “Shareholders’ Agreement”), to which the substantial form of this Deed of Adherence forms Exhibit B.

B.The New Shareholder is the acquiror/intended transferee of [              ] [Ordinary Shares] [Preferred Shares] of par value US$[        ] each (“Transferred Shares”) in the capital of the Company from [                              ] (“Transferor”) and [in accordance with Section 10.2 of the Shareholders’ Agreement] is executing this Deed.

THIS DEED WITNESSES as follows:

1.Interpretation.  Capitalized terms not otherwise defined in this Deed shall have the meanings given to then in the Shareholders’ Agreement.

2.Covenant; Enforceability.  The New Shareholder hereby ratifies and accedes to the terms of, agrees to be bound by, and assumes all rights and obligations under the terms and conditions of, the Shareholders’ Agreement, as if the New Shareholder had been an original party to the Shareholders’ Agreement in the same capacity as the Transferor.  The existing shareholders shall be entitled to enforce the Shareholders’ Agreement against the New Shareholder.

3.Representation and Warranty.  The New Shareholder hereby represents and warrants to the existing shareholders that:

(a)The New Shareholder is duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(b)The New Shareholder has all requisite power and authority to execute and deliver this Deed and to assume and perform all rights and obligations under the Shareholders’ Agreement. Upon their execution, this Deed and the Shareholders’ Agreement shall constitute valid and legally binding obligations thereof, enforceable against such party in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(a)The execution, delivery and performance by the New Shareholder of and compliance with the Deed and the Shareholders’ Agreement, and the consummation of the transactions contemplated thereby, will not result in any violation, breach or default, or be in conflict with or constitute, with or without the passage of time or the giving of notice or both, a default under (A) the articles of association or any other such constitutional documents of the

Exhibit B-1

New Shareholder, (B) any material contract to which the New Shareholder is a party, (C) any judgment, order, writ or decree or (D) any applicable law.

4.Governing Law.  This Adherence Deed shall be governed by and construed in all respects in accordance with the laws of Hong Kong.

IN WITNESS WHEREOF this Deed of Adherence has been executed [as a deed] by the New Shareholder on the date set forth above.

[NEW SHAREHOLDER]	)
in the presence of:	)

Exhibit B-2

Schedule I

LIST OF MANAGEMENT PARTIES

Management Shareholders	Management Holdcos
QI GUOSHENG (祁国晟)	GENERATION GOSPEL LIMITED
YU GUOFA (于国法)	GARDEN ENTERPRISES LTD.

Schedule II

SCHEDULE OF PREFERRED SHAREHOLDERS

Steamboat Ventures Asia, L.P.

Nokia Growth Partners II, L.P.

Quantum Strategic Partners Ltd.

Rainbow Castle Holdings Limited

UVM 2 Venture Investments LP acting through its general partner UOB Bioventures Management Pte Ltd

Broad Street Investments Holding (Singapore) Pte. Ltd.

ASEAN China Investment Fund II L.P.

VLTCM Ltd.

PA Venture Opportunity VII Limited

Moon Capital Master Fund Ltd.

Moon Capital Partners Master Fund Ltd.

Bridge Street 2015, L.P.

MBD 2015, L.P.

Stone Street 2015, L.P.

2015 Employee Offshore Aggregator, L.P.

Schedule III

LIST OF KEY EMPLOYEES

NAME	POSITIONS
QI GUOSHENG (祁国晟)	Chief Executive Officer
YU GUOFA (于国法)	Vice President in charge of Operation
LIU JOHN	Chief Technology Officer
ZHANG PENG (张鹏)	Chief Financial Officer
LI FENG (李峰)	Vice President in charge of Sales
XU YANG (续扬)	Vice President in charge of Business Development

Schedule IV

REGISTRATION RIGHTS

1.Definitions.  The following terms used in this Schedule IV shall have the meanings ascribed to the below:

“Commission” means (i) with respect to any offering of securities in the United States, the Securities and Exchange Commission of the United States or any other federal agency at the time administering the Securities Act and (ii) with respect to any offering of securities in a jurisdiction other than the United States, the regulatory body of the jurisdiction with authority to supervise and regulate the offering and sale of securities in that jurisdiction.

“Effective Date” means January 30, 2015.

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

“Form F-3” means Form F-3 promulgated by the Commission under the Securities Act or any successor form or substantially similar form then in effect.

“Form S-3” means Form S-3 promulgated by the Commission under the Securities Act or any successor form or substantially similar form then in effect.

“Holders” means the holders of Registrable Securities who are parties to this Agreement from time to time, and their transferees that become parties to this Agreement from time to time.

“Initiating Holders” means, with respect to a request duly made under Section 2.1 or Section 2.2 of this Schedule IV to Register any Registrable Securities, the Holders initiating such request.

“IPO” means the first firm underwritten registered public offering by the Company of its Ordinary Shares pursuant to a Registration Statement that is filed with and declared effective by either the Commission under the Securities Act or another Governmental Authority for a public offering in a jurisdiction other than the United States.

“Registrable Securities” means (i) the Ordinary Shares issued or issuable upon conversion of the Preferred Shares, (ii) any Ordinary Shares owned or hereafter acquired by the Preferred Shareholders, and (iii) any Ordinary Shares of the Company issued as a dividend or other distribution with respect to, in exchange for, or in replacement of, the shares referenced in (i) and (ii) herein, excluding in all cases, however, any of the foregoing sold by a Person in a transaction other than an assignment pursuant to Section 10.2 of the Second Amended and Restated Shareholders’ Agreement.

“Registration” means a registration effected by preparing and filing a Registration Statement and the declaration or ordering of the effectiveness of that Registration Statement; and the terms “Register” and “Registered” have meanings concomitant with the foregoing.

Schedule IV-1

“Registration Statement” means a registration statement prepared on Form F-1, F-3, S-1, or S-3 under the Securities Act (including, without limitation, Rule 415 under the Securities Act), or on any comparable form in connection with registration in a jurisdiction other than the United States.

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

“Violation” has the meaning set forth in Section 5.1(i) of this Schedule IV.

Except where the context requires otherwise, capitalized terms used herein without definition shall have the meanings set forth in the Section 1 of the Second Amended and Restated Shareholders’ Agreement.

2.Demand Registration.

2.1Registration Other Than on Form F-3 or Form S-3.  Subject to the terms of this Agreement, at any time or from time to time after the earlier of (i) the two (2) year anniversary of the Effective Date or (ii) the date that is six (6) months after the closing of the IPO, Holder(s) holding twenty-five percent (25%) or more of the outstanding Registrable Securities held by all Holders may request in writing that the Company effect a Registration on any internationally recognized exchange that is reasonably acceptable to such requesting Holder(s).  Upon receipt of such a request, the Company shall (x) promptly give written notice of the proposed Registration to all other Holders and (y) as soon as practicable, use its best efforts to cause the Registrable Securities specified in the request, together with any Registrable Securities of any Holder who requests in writing to join such Registration within fifteen (15) days after the Company’s delivery of written notice, to be Registered and/or qualified for sale and distribution in such jurisdiction as the Initiating Holders may request.  The Company shall be obligated to effect no more than two (2) Registrations pursuant to this Section 2.1 that have been declared and ordered effective; provided that if the sale of all of the Registrable Securities sought to be included pursuant to this Section 2.1 is not consummated for any reason other than due to the action or inaction of the Holders including Registrable Securities in such Registration, such Registration shall not be deemed to constitute one of the Registration rights granted pursuant to this Section 2.1.

2.2Registration on Form F-3 or Form S-3.  Subject to the terms of this Agreement, if the Company qualifies for registration on Form F-3 or Form S-3 (or any comparable form for Registration in a jurisdiction other than the United States), any Holder may request the Company to file, in any jurisdiction in which the Company has had a registered underwritten public offering, a Registration Statement on Form F-3 or Form S-3 (or any comparable form for Registration in a jurisdiction other than the United States), including without limitation any registration statement filed under the Securities Act providing for the registration of, and the sale on a continuous or a delayed basis by the Holders of, all of the Registrable Securities pursuant to Rule 415 under the Securities Act and/or any similar rule that may be adopted by the Commission.  Upon receipt of such a request, the Company shall (i) promptly give written notice of the proposed Registration to all other Holders and (ii) as soon as practicable, use its best efforts to cause the Registrable Securities specified in the request, together with any Registrable Securities of any Holder who requests in writing to join such Registration within fifteen (15)

Schedule IV-2

days after the Company’s delivery of written notice, to be Registered and qualified for sale and distribution in such jurisdiction.  The Company shall be obligated to effect no more than two (2) Registrations that have been declared and ordered effective within any twelve (12)-month period pursuant to this Section 2.2; provided that if the sale of all of the Registrable Securities sought to be included pursuant to this Section 2.2 is not consummated for any reason other than due to the action or inaction of the Holders including Registrable Securities in such Registration, such Registration shall not be deemed to constitute one of the Registration rights granted pursuant to this Section 2.2.

2.3Right of Deferral.

(i)The Company shall not be obligated to Register or qualify Registrable Securities pursuant to Section 2:

(a)if, within ten (10) days of the receipt of any request of the Holders to Register any Registrable Securities under Section 2.1 or Section 2.2, the Company gives notice to the Initiating Holders of its bona fide intention to effect the filing for its own account of a Registration Statement of Ordinary Shares within sixty (60) days of receipt of that request; provided, that the Company is actively employing in good faith its best efforts to cause that Registration Statement to become effective within sixty (60) days of receipt of that request; provided, further, that the Holders are entitled to join such Registration subject to Section 3 (other than a registration of securities in a transaction under Rule 145 of the Securities Act or with respect to an employee benefit plan;

(b)during the period starting with the date of filing by the Company of, and ending six (6) months following the effective date of any Registration Statement pertaining to Ordinary Shares of the Company; provided, that the Holders are entitled to join such Registration subject to Section 3 (other than a registration of securities in a transaction under Rule 145 of the Securities Act or with respect to an employee benefit plan); or

(c)in any jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such Registration or qualification, unless the Company is already subject to service of process in such jurisdiction.

(ii)If, after receiving a request from Holders pursuant to Section 2.1 or Section 2.2 hereof, the Company furnishes to the Holders a certificate signed by the chief executive officer of the Company stating that, in the good faith judgment of the Board, it would be materially detrimental to the Company or its members for a Registration Statement to be filed in the near future, then the Company shall have the right to defer such filing for a period during which such filing would be materially detrimental, provided, that that the Company may not utilize this right and/or the deferral right contained in clause (ii) for more than ninety (90) days on any one occasion or for more than once during any twelve (12) month period; provided, further, that the Company may not Register any other of its securities during such period (except for Registrations contemplated by Section 3.4).

Schedule IV-3

2.4Underwritten Offerings.  If, in connection with a request to Register Registrable Securities under Section 2.1 or Section 2.2, the Initiating Holders seek to distribute such Registrable Securities in an underwritten offering, they shall so advise the Company as a part of the request, and the Company shall include such information in the written notice to the other Holders described in Section 2.1 and Section 2.2.  In such event, the right of any Holder to include its Registrable Securities in such Registration shall be conditioned upon such Holder’s participation in such underwritten offering and the inclusion of such Holder’s Registrable Securities in the underwritten offering (unless otherwise mutually agreed by a majority-in-interest of the Initiating Holders and such Holder, taken together) to the extent provided herein. All Holders proposing to distribute their securities through such underwritten offering shall enter into an underwriting agreement in customary form with the underwriter or underwriters of internationally recognized standing selected for such underwritten offering by the Company and reasonably acceptable to the holders of a majority of the voting power of all Registrable Securities proposed to be included in such Registration.  Notwithstanding any other provision of this Agreement, if the managing underwriter advises the Company that marketing factors (including without limitation the aggregate number of securities requested to be Registered, the general condition of the market, and the status of the Persons proposing to sell securities pursuant to the Registration) require a limitation of the number of Registrable Securities to be underwritten in a Registration pursuant to Section 2.1 or Section 2.2, the underwriters may (i) in the event the offering is the Company’s IPO, exclude from the underwritten offering all of the Registrable Securities (so long as the only securities included in such offering are those sold for the account of the Company), or (ii) otherwise exclude up to seventy percent (70%) of the Registrable Securities requested to be Registered but only after first excluding all other Equity Securities from the Registration and underwritten offering and so long as the number of Registrable Securities to be included in the Registration is allocated among all Holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities requested by such Holders to be included.  Any Registrable Securities excluded or withdrawn from such underwritten offering shall be withdrawn from the Registration. To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to a Holder to the nearest one hundred (100) shares.

3.Piggyback Registrations.

3.1Registration of the Company’s Securities.  Subject to the terms of this Agreement, if the Company proposes to Register for its own account any of its Equity Securities, or for the account of any holder (other than a Holder) of Equity Securities any of such holder’s Equity Securities, in connection with the public offering of such securities (except as set forth in Section 3.4, the Company shall promptly give each Holder written notice of such Registration and, upon the written request of any Holder given within fifteen (15) days after delivery of such notice, the Company shall use its best efforts to include in such Registration any Registrable Securities thereby requested to be Registered by such Holder.  If a Holder decides not to include all or any of its Registrable Securities in such Registration by the Company, such Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent Registration Statement or Registration Statements as may be filed by the Company, all upon the terms and conditions set forth herein.

Schedule IV-4

3.2Right to Terminate Registration.  The Company shall have the right to terminate or withdraw any Registration initiated by it under Section 3.1prior to the effectiveness of such Registration, whether or not any Holder has elected to participate therein.  The expenses of such withdrawn Registration shall be borne by the Company in accordance with Section 4.3.

3.3Underwriting Requirements.

(i)In connection with any offering involving an underwriting of the Company’s Equity Securities, the Company shall not be required to Register the Registrable Securities of a Holder under this Section 3 unless such Holder’s Registrable Securities are included in the underwritten offering and such Holder enters into an underwriting agreement in customary form with the underwriter or underwriters of internationally recognized standing selected by the Company and setting forth such terms for the underwritten offering as have been agreed upon between the Company and the underwriters.  In the event the underwriters advise Holders seeking Registration of Registrable Securities pursuant to this Section 3 in writing that market factors (including the aggregate number of Registrable Securities requested to be Registered, the general condition of the market, and the status of the Persons proposing to sell securities pursuant to the Registration) require a limitation of the number of Registrable Securities to be underwritten, the underwriters may (i) in the event the offering is the Company’s IPO, exclude all of the Registrable Securities (so long as the only securities included in such offering are those sold for the account of the Company and no securities of other selling shareholders are included), or (ii) otherwise exclude up to seventy percent (70%) of the Registrable Securities requested to be Registered but only after first excluding all other Equity Securities (except for securities sold for the account of the Company) from the Registration and underwriting and so long as the number of Registrable Securities to be included in such Registration is allocated among all Holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities requested by such Holders to be included. To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to a Holder to the nearest one hundred (100) shares.

(ii)If any Holder disapproves the terms of any underwriting, the Holder may elect to withdraw therefrom by written notice to the Company and the underwriters delivered at least ten (10) days prior to the effective date of the Registration Statement.  Any Registrable Securities excluded or withdrawn from the underwritten offering shall be withdrawn from the Registration.  Notwithstanding the foregoing, the Company shall not be required to pay for any expenses of any Registration proceeding begun pursuant to Section 2.1 or Section 2.2 if the Registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all participating Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration), unless such withdrawal is due to an action or inaction of the Company or an event outside of the reasonable control of such Holders.

3.4Exempt Transactions.  The Company shall have no obligation to Register any Registrable Securities under this Section 3 in connection with a Registration by the Company (i) relating solely to the sale of securities to participants in a Company share plan, or (ii) relating to a corporate reorganization or other transaction under Rule 145 of the Securities Act (or comparable provision under the Laws of another jurisdiction, as applicable).

Schedule IV-5

4.Registration Procedures.

4.1Registration Procedures and Obligations.  Whenever required under this Agreement to effect the Registration of any Registrable Securities held by the Holders, the Company shall, as expeditiously as reasonably possible:

(i)Prepare and file with the Commission a Registration Statement with respect to those Registrable Securities and use its best efforts to cause that Registration Statement to become effective, and, upon the request of the Holders holding a majority of the Registrable Securities Registered thereunder, keep the Registration Statement effective for up to one hundred twenty (120) days or, if earlier, until the distribution thereunder has been completed; provided, however, that (a) such one hundred twenty (120) day period shall be extended for a period of time equal to the period any Holder refrains from selling any Registrable Securities included in such Registration at the written request of the underwriter(s) for such Registration, and (b) in the case of any Registration of Registrable Securities on Form F-3 or Form S-3 that are intended to be offered on a continuous or delayed basis, subject to compliance with applicable rules promulgated by the Securities and Exchange Commission, such one hundred twenty (120) day period shall be extended, if necessary, to keep the Registration Statement or such comparable form, as the case may be, effective until all such Registrable Securities are sold;

(ii)Prepare and file with the Commission amendments and supplements to that Registration Statement and the prospectus used in connection with the Registration Statement as may be necessary to comply with the provisions of applicable securities Laws with respect to the disposition of all securities covered by the Registration Statement;

(ii)Furnish to the Holders the number of copies of a prospectus, including a preliminary prospectus, required by applicable securities Laws, and any other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them;

(iii)Use its best efforts to Register and qualify the securities covered by the Registration Statement under the securities Laws of any jurisdiction, as reasonably requested by the Holders, provided, that the Company shall not be required to qualify to do business or file a general consent to service of process in any such jurisdictions;

(iv)In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in customary form, with the managing underwriter(s) of the offering;

(iii)Promptly notify each Holder of Registrable Securities covered by the Registration Statement at any time when a prospectus relating thereto is required to be delivered under applicable securities Laws of (a) the issuance of any stop order by the Commission, or (b) the happening of any event or the existence of any condition as a result of which any prospectus included in the Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances under which they were made, or if in the opinion of counsel for the Company it is necessary to supplement or amend

Schedule IV-6

such prospectus to comply with law, and at the request of any such Holder promptly prepare and furnish to such Holder a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances under which they were made or such prospectus, as supplemented or amended, shall comply with law;

(v)Furnish, at the request of any Holder requesting Registration of Registrable Securities pursuant to this Agreement, on the date that such Registrable Securities are delivered for sale in connection with a Registration pursuant to this Agreement, (i) an opinion, dated the date of the sale, of the counsel representing the Company for the purposes of the Registration, in form and substance as is customarily given to underwriters in an underwritten public offering; and (ii) a comfort letter dated the date of the sale, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters;

(iv)Otherwise comply with all applicable rules and regulations of the Commission to the extent applicable to the applicable registration statement and use its best efforts to make generally available to its security holders (or otherwise provide in accordance with Section 11(a) of the Securities Act) an earnings statement satisfying the provisions of Section 11(a) of the Securities Act, no later than forty-five (45) days after the end of a twelve (12) month period (or ninety (90) days, if such period is a fiscal year) beginning with the first month of the Company’s first fiscal quarter commencing after the effective date of such registration statement, which statement shall cover such twelve (12) month period, subject to any proper and necessary extensions;

(vi)Not, without the prior consent of the holders of at least a majority of voting power of the then outstanding Registrable Securities, make any offer relating to the Securities that would constitute a “free writing prospectus,” as defined in Rule 405 promulgated under the Securities Act;

(vii)Provide a transfer agent and registrar for all Registrable Securities Registered pursuant to the Registration Statement and, where applicable, a number assigned by the Committee on Uniform Securities Identification Procedures for all those Registrable Securities, in each case not later than the effective date of the Registration; and

(v)Take all reasonable action necessary to list the Registrable Securities on the primary exchange on which the Company’s securities are then traded or, in connection with an IPO, the primary exchange on which the Company’s securities will be traded.

4.2Information from Holder.  It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Agreement with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of

Schedule IV-7

such securities as shall be required to effect the Registration of such Holder’s Registrable Securities.

4.3Expenses of Registration.  All expenses, other than the underwriting discounts and selling commissions applicable to the sale of Registrable Securities pursuant to this Agreement (which shall be borne by the Holders requesting Registration on a pro rata basis in proportion to their respective numbers of Registrable Securities sold in such Registration), incurred in connection with Registrations, filings or qualifications pursuant to this Agreement, including (without limitation) all Registration, filing and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Company and reasonable fees and disbursement of one counsel for all selling Holders, shall be borne by the Company. The Company shall not, however, be required to pay for any expenses of any Registration proceeding begun pursuant to this Agreement if the Registration request is subsequently withdrawn at the request of a majority-in-interest of the Holders requesting such Registration (in which case all participating Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be thereby Registered in the withdrawn Registration).

5.Registration-Related Indemnification.

5.1Company Indemnity.

(i)To the maximum extent permitted by Law, the Company will indemnify and hold harmless each Holder, such Holder’s partners, officers, directors, shareholders and legal counsel, any underwriter (as defined in the Securities Act) and each Person, if any, who controls (as defined in the Securities Act) such Holder or underwriter, against any losses, claims, damages or liabilities (joint or several) to which they may become subject under Laws which are applicable to the Company and relate to action or inaction required of the Company in connection with any Registration, qualification, or compliance, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (each a “Violation”):  (a) any untrue statement or alleged untrue statement of a material fact contained in such Registration Statement, on the effective date thereof (including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto), (b) the omission or alleged omission to state in the Registration Statement, on the effective date thereof (including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto), a material fact required to be stated therein or necessary to make the statements therein not misleading, or (c) any violation or alleged violation by the Company of applicable securities Laws, or any rule or regulation promulgated under applicable securities Laws.  The Company will reimburse each such Holder, underwriter or controlling person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action.

(ii)The indemnity agreement contained in this Section 5.1 shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld or delayed), nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it arises solely out of or is solely based upon a Violation that

Schedule IV-8

occurs in reliance upon and in conformity with written information furnished in a certificate expressly for use in connection with such Registration by any such Holder, such Holder’s partners, officers, directors, and legal counsel, any underwriter (as defined in the Securities Act) and each Person, if any, who controls (as defined in the Securities Act) such Holder or underwriter.  Further, the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Holder or other aforementioned person, or any person controlling such Holder, from whom the person asserting any such losses, claims, damages or liabilities purchased shares in the offering, if a copy of the most current prospectus was not sent or given by or on behalf of such Holder or other aforementioned person to such person, if required by law to have been so delivered, at or prior to the written confirmation of the sale of the shares to such person, and if the prospectus (as so amended or supplemented) would have cured the defect giving rise to such loss, claim, damage or liability.

5.2Holder Indemnity.

(i)To the maximum extent permitted by Law, each selling Holder that has included Registrable Securities in a Registration will, severally and not jointly, indemnify and hold harmless the Company, its directors, officers, legal counsel and accountants, any underwriter, any other Holder selling securities in connection with such Registration and each Person, if any, who controls (within the meaning of the Securities Act) the Company, such underwriter or other Holder, against any losses, claims, damages or liabilities (joint or several) to which any of the foregoing persons may become subject, under applicable securities Laws, or any rule or regulation promulgated under applicable securities Laws, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder in a certificate expressly for use in connection with such Registration; and each such Holder will reimburse any Person intended to be indemnified pursuant to this Section 5.2, for any legal or other expenses reasonably incurred by such Person in connection with investigating or defending any such loss, claim, damage, liability or action.  No Holder’s liability under this Section 5.2 shall exceed the net proceeds (less underwriting discounts and selling commissions) received by such Holder from the offering of securities made in connection with that Registration.

(ii)The indemnity contained in this Section 5.2 shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder (which consent shall not be unreasonably withheld or delayed).

5.3Notice of Indemnification Claim.  Promptly after receipt by an indemnified party under Section 5.1 or Section 5.2 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under Section 5.1 or Section 5.2, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the indemnifying parties.  An indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the reasonably incurred fees and expenses to be paid by the

Schedule IV-9

indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party, to the extent so prejudiced, of any liability to the indemnified party under this Section 5, but the omission to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 5.

5.4Contribution.  If any indemnification provided for in Section 5.1 or Section 5.2 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to herein, the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and of the indemnified party, on the other, in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense, as well as any other relevant equitable considerations.  The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission. No Holder’s liability under this Section 5.4, when combined with such Holder’s liability under Section 5.2, shall exceed the net proceeds (less underwriting discounts and selling commissions) received by such Holder from the offering of securities made in connection with that Registration.

5.5Underwriting Agreement.  To the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

5.6Survival.  The obligations of the Company and Holders under this Section 5 shall survive the completion of any offering of Registrable Securities in a Registration Statement under this Agreement.

6.Additional Registration-Related Undertakings.

6.1Reports under the Exchange Act.  With a view to making available to the Holders the benefits of Rule 144 promulgated under the Securities Act and any comparable provision of any applicable securities Laws that may at any time permit a Holder to sell securities of the Company to the public without Registration or pursuant to a Registration on Form F-3 or Form S-3 (or any comparable form in a jurisdiction other than the United States), the Company agrees to:

Schedule IV-10

(i)make and keep public information available, as those terms are understood and defined in Rule 144 (or comparable provision, if any, under applicable securities Laws in any jurisdiction where the Company’s securities are listed), at all times following ninety (90) days after the effective date of the first Registration under the Securities Act filed by the Company for an offering of its securities to the general public;

(ii)file with the Commission in a timely manner all reports and other documents required of the Company under all applicable securities Laws; and

(iii)at any time following ninety (90) days after the effective date of the first Registration under the Securities Act filed by the Company for an offering of its securities to the general public by the Company, promptly furnish to any Holder holding Registrable Securities, upon request (a) a written statement by the Company that it has complied with the reporting requirements of all applicable securities Laws at any time after it has become subject to such reporting requirements or, at any time after so qualified, that it qualifies as a registrant whose securities may be resold pursuant to Form F-3 or Form S-3 (or any form comparable thereto under applicable securities Laws of any jurisdiction where the Company’s securities are listed), (b) a copy of the most recent annual or quarterly report of the Company and such other reports and documents as filed by the Company with the Commission, and (c) such other information as may be reasonably requested in availing any Holder of any rule or regulation of the Commission, that permits the selling of any such securities without Registration or pursuant to Form F-3 or Form S-3 (or any form comparable thereto under applicable securities Laws of any jurisdiction where the Company’s Securities are listed).

6.2Limitations on Subsequent Registration Rights.  From and after the date of this Agreement, the Company shall not, without the prior written consent of holders of at least a majority of the then outstanding Registrable Securities held by all Holders, enter into any agreement with any holder or prospective holder of any Equity Securities of the Company that would allow such holder or prospective holder (i) to include such Equity Securities in any Registration filed under Section 2 or Section 3, unless under the terms of such agreement such holder or prospective holder may include such Equity Securities in any such Registration only to the extent that the inclusion of such Equity Securities will not reduce the amount of the Registrable Securities of the Holders that are included, (ii) to demand Registration of their Equity Securities, or (iii) cause the Company to include such Equity Securities in any Registration filed under Section 2 or Section 3 hereof on a basis pari passu with or more favorable to such holder or prospective holder than is provided to the Holders of Registrable Securities.

6.3“Market Stand-Off” Agreement.  Each Shareholder agrees, if so required by the managing underwriter(s), that it will not during the period commencing on the date of the final prospectus relating to the Company’s IPO and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days from the date of such final prospectus) (i) lend, offer, pledge, hypothecate, hedge, sell, make any short sale of, loan, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any Equity Securities of the Company (other than those included in such offering) or (ii) enter into any swap or other arrangement that transfers to another, in whole or in

Schedule IV-11

part, any of the economic consequences of ownership of the Equity Securities of the Company, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Equity Securities of the Company or such other securities, in cash or otherwise; provided, that (x) all directors, officers and all other holders of at least one percent (1%) of the outstanding share capital of the Company must be bound by restrictions at least as restrictive as those applicable to any such holder pursuant to this Section 6.3, (y) this Section 6.3 shall not apply to the extent that any other members subject to substantially similar restrictions are released, and (z) the lockup agreements shall permit such holders to transfer their Registrable Securities to their respective Affiliates so long as the transferees enters into the same lockup agreement.  The underwriters in connection with the Company’s IPO are intended third party beneficiaries of this Section 6.3 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto.  In order to enforce the foregoing covenant, the Company may place restrictive legends on the certificates and impose stop-transfer instructions with respect to the Registrable Securities of each shareholder (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period.

6.4Termination of Registration Rights.  The registration rights set forth in Section 2 and Section 3 above shall terminate on the earlier of (i) the date that is five (5) years after the date of closing of an IPO and (ii) with respect to any Holder, the date on which such Holder may sell all of such Holder’s Registrable Securities under Rule 144 of the Securities Act in any ninety (90)-day period.

6.5Exercise of Preferred Shares.  Notwithstanding anything to the contrary provided in this Agreement, the Company shall have no obligation to register Registrable Securities which, if constituting Ordinary Share Equivalents, have not been exercised, converted or exchanged, as applicable, for Ordinary Shares.

7.Jurisdiction.  The terms of this Schedule IV are drafted primarily in contemplation of an offering of securities in the United States of America.  The Parties recognize, however, the possibility that securities may be qualified or registered for offering to the public in a jurisdiction other than the United States of America where registration rights have significance or that the Company might effect an offering in the United States of America in the form of American depositary receipts or American depositary shares.  Accordingly:

(i)It is their intention that, whenever this Schedule IV or any portion of the Second Amended and Restated Shareholders’ Agreement refers to a Law, form, process or institution of the United States of America but the parties wish to effectuate qualification or registration in a different jurisdiction where registration rights have significance, such references to the Laws or institutions of the United States shall be read as referring, mutatis mutandis, to the comparable Laws or institutions of the jurisdiction in question; and

(ii)It is agreed that the Company will not undertake any listing of American depositary receipts, American depositary shares or any other security derivative of the Company’s Ordinary Shares unless arrangements have been made reasonably satisfactory to a majority-in-interest of the Shareholders to ensure that the spirit and intent of the Second Amended and Restated Shareholders’ Agreement will be realized and that the Company is committed to take such actions as are necessary such that the Shareholders will enjoy rights

Schedule IV-12

corresponding to the rights hereunder to sell their Registrable Securities in a public offering in the United States of America as if the Company had listed Ordinary Shares in lieu of such derivative securities.

Schedule IV-13

Schedule V

NOTICE ADDRESSES

For the purpose of the notice provisions contained in this Second Amended and Restated Shareholders’ Agreement, the following are the initial addresses of each party:

If to the Company, the HK Holdco, the WFOE, Gridsum Holdco, Beijing Gridsum, Beijing Moment, Guoxinjunhe, Beijing Yunyang, Tom Melcher Revocable Trust, Employee Holdco or the Management Parties:

Attention:	Guosheng Qi
Address:	[Address]
Fax:	[Fax]

With an email copy to:  [Email address]

If to the Preferred Shareholders:

Steamboat Ventures Asia, L.P.

Attn:	Liping Fan
	[Address]
Phone:	[Telephone]
Fax:	[fax]
Email:

Nokia Growth Partners II, L.P.

Address:	[Address]
Attention:	Paul Asel
Phone:	[Telephone]
Fax:	[Fax]
Email:

Quantum Strategic Partners Ltd.

Address:	[Address]
Attention:	David Taylor
Phone:	[Telephone]
Fax:	[Fax]
Email:	[Email address]

with a copy to:

Address:	Paul, Weiss, Rifkind, Wharton & Garrison
	[Address]
Attention:	Ms. Jeanette K. Chan
Phone:	[Telephone]

Fax:	[Fax]
Email:	[Email address]

Rainbow Castle Holdings Limited

Address:	[Address]
Attention:	Ning Cong
Phone:	[Telephone]
Fax:	[Fax]
Email:	[Email address]

UVM 2 Venture Investments LP acting through its general partner UOB Bioventures Management Pte Ltd and ASEAN China Investment Fund II L.P.

Address:	[Address]
Attention:	Jean Thoh / Kuah Cheng Ooi
Phone:	[Telephone]
Fax:	[Fax]
Email:	[Email address]

Broad Street Investments Holding (Singapore) Pte. Ltd.

Address:	[Address]
Attention:	Joanne Xu, Executive Director
Phone:	[Telephone]
Fax:	[Fax]
Email:	[Email address]

If to PA Venture Opportunity VII Limited

Address: [Address]

With a copy to: [Address]

Attention:  Herman Fong / Jon Lewis

Phone: [Telephone]

Fax: [Fax]

Emails:  [Email address]

If to VLTCM Ltd.

Address:	[Address]
Attention:	Juliana Wong
Phone:	[Telephone]
Email:	[Email address]

If to Moon Capital Master Fund Ltd. and Moon Capital Partners Master Fund Ltd.

Address: [Address]
Attention:[Address]
Phone: [Telephone]

Fax: [Fax]
Email: [Email address]

EX-5.1

Exhibit 5.1

Direct:	+852 2801 6066
Cell:	+852 9162 1971
E-mail:	harriet.unger@traversthorpalberga.com

Gridsum Holding Inc.
[Harbour Place 2nd Floor
103 South Church Street
P.O. Box 472, George Town
Grand Cayman KY1-1106
Cayman Islands]

[          ]

Dear Sirs

Gridsum Holding Inc.

We have acted as Cayman Islands legal advisers to Gridsum Holding Inc. (the “Company”) in connection with the Company’s registration statement on Form F-1, including all amendments or supplements thereto, filed with the United States Securities and Exchange Commission (the “Commission”) under the United States Securities Act of 1933 (the “Act”), as amended (the “Registration Statement”), related to the offering by the Company of American Depositary Shares representing certain ordinary shares, par value [US$0.001] per share (the “Shares”).  This opinion is given in accordance with the terms of the Legal Matters section of the Registration Statement.

1Documents Reviewed

For the purposes of this opinion we have reviewed originals, copies, drafts or conformed copies of the documents listed in Schedule 1 to this opinion, being all of the documents necessary to form our opinion.  Defined terms shall have the meanings set out in Schedule 1 or in the Registration Statement.

2Assumptions

The following opinions are given only as to and based on circumstances and matters of fact existing at the date hereof and as to the laws of the Cayman Islands as the same are in force at the date hereof.  In giving this opinion, we have relied upon the completeness and accuracy (and assumed the continuing completeness and accuracy as at the date hereof) of the Director’s Certificate, as to matters of fact, without further verification and have assumed that copy documents or drafts of documents provided to us are true and complete copies of, or in the final forms of, the originals.

3Opinions

Based upon, and subject to, the foregoing assumptions, and having regard to such legal considerations as we deem relevant, we are of the opinion that:

3.1the Company has been duly incorporated and is validly existing and in good standing under the laws of the Cayman Islands;

3.2the issue and allotment of the Shares have been duly authorised and when allotted, issued and paid for as contemplated in the Registration Statement, the Shares will be legally issued and allotted, fully paid and non-assessable.  In this opinion the phrase “non-assessable” means, with respect to Shares in the Company, that a shareholder shall not, solely by virtue of its status as a shareholder, be liable for additional assessments or calls on the Shares by the Company or its creditors (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which a court may be prepared to pierce or lift the corporate veil). As a matter of Cayman law, a share is only issued when it has been entered in the register of members (shareholders); and

3.3the statements under the caption “Taxation” in the prospectus forming part of the Registration Statement, to the extent that they constitute statements of Cayman Islands law, are accurate in all material respects and such statements constitute our opinion.

We hereby consent to the prospectus discussion of this opinion, to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the headings “Enforceability of Civil Liabilities” and “Legal Matters” and elsewhere in the prospectus included in the Registration Statement. In providing our consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission thereunder.

This opinion is limited to the matters detailed herein and is not to be read as an opinion with respect to any other matter.

Yours faithfully

TRAVERS THORP ALBERGA

SCHEDULE 1

List of Documents Reviewed

1the Certificate of Incorporation dated 21 July 2014;

2the register of members of the Company certified by [           ] on [         ] 2015;

3the register of directors of the Company certified by [           ] on [         ] 2015;

4the Fourth Amended and Restated Memorandum and Articles of Association of the Company as adopted by special resolution on 30 June 2015 (the “Pre-IPO M&A”);

5the written resolutions of the Board of Directors dated [         ] 2015 (the “IPO Board Resolutions”);

6the written resolutions of the shareholders of the Company dated [         ] 2015 (the “Shareholders’ Resolutions”, together with the IPO Board Resolutions are referred to as the “Resolutions”);

7a certificate from a Director of the Company addressed to this firm, a copy of which is attached hereto (the “Director’s Certificate”); and

8the Registration Statement.

EX-8.2

Exhibit 8.2

             , 2016

Gridsum Holding Inc.

Jade Palace Hotel Office Building, 8th Floor

76 Zhichun Road

Haidian District, Beijing 100086

People’s Republic of China

(86-10) 8261-9988

Re:  Gridsum Holding Inc.

In connection with the public offering of Ordinary Shares, par value US$0.001 per share, of Gridsum Holding Inc., a Cayman Islands company (the “Company”), pursuant to the registration statement on Form F-1 under the Securities Act of 1933, as amended (the “Securities Act”), originally filed by the Company with the Securities and Exchange Commission on                         (Registration No. 333-                 ) (as so filed and as amended, the “Registration Statement”), you have requested our opinion concerning the accuracy of certain statements set forth under the heading, “Taxation — Material United States Federal Income Tax Considerations,” in the prospectus (the “Prospectus”) included in the Registration Statement.

In connection with rendering the opinion set forth herein, we have examined and relied on the factual statements and representations of the Company concerning its business, properties and governing documents as set forth in the Registration Statement. We also have made such legal and factual examinations and inquiries as we have deemed necessary or appropriate for purposes of this opinion.

In our examination, we have assumed the authenticity of all documents submitted to us as originals, the genuineness of all signatures thereon, the legal capacity of natural persons executing such documents and the conformity to authentic original documents of all documents submitted to us as copies. For the purpose of our opinion, we have not made an independent investigation or audit of the facts set forth in the above-referenced documents. In addition, in rendering this opinion we have assumed the truth, completeness and accuracy of all representations and statements made to us which are qualified as to knowledge or belief, without regard to such qualification.

Based on the facts, assumptions and representations described above and subject to the limitations set forth herein and in the Registration Statement, the statements set forth under the heading “Taxation — Material United States Federal Income Tax Considerations” in the Prospectus, insofar as such statements constitute matters of law or legal conclusions with respect thereto, constitute the opinion of Fenwick & West LLP as of the date hereof as to the material U.S. federal income tax consequences to U.S. Holders (as defined therein) of the ownership and disposition of the Company’s Ordinary Shares.

We express no opinion other than the opinion expressly set forth herein.

Our opinion is not binding on the Internal Revenue Service (the “IRS”). There can be no assurance that our opinion will be accepted by the IRS or, if challenged, by a court. Our opinion is based upon the U.S. Internal Revenue Code of 1986, as amended (the “Code”), the U.S. Treasury Regulations promulgated thereunder, and administrative and judicial interpretations of the Code and the U.S. Treasury Regulations, all as currently in effect as of the date of this opinion letter, and all subject to differing interpretations or change, possibly on a retroactive basis. Changes in applicable law could cause the U.S. federal income tax consequences of owning and disposing of the Company’s Ordinary Shares to differ materially and adversely from the consequences described in the Prospectus and could render the tax discussion in the Prospectus incorrect or incomplete. Also, any variation or difference in the facts from those set forth in the representations described above, including in the Registration Statement, could affect our opinion set forth herein.

This opinion is furnished solely in connection with the Registration Statement and may not be relied on or used for any other purpose without our prior written consent, provided, however, that it may be relied on by persons entitled to rely on it pursuant to applicable provisions of federal securities laws. This opinion letter presents our opinion only as of the date hereof, and we undertake no obligation to update this opinion letter or to notify any person of any changes in facts, circumstances or applicable law.

We hereby consent to the inclusion of this opinion as Exhibit 8.2 to the Registration Statement and to the references to our firm under the captions “Legal Matters” in the Registration Statement. In giving our consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations promulgated thereunder, nor do we thereby admit that we are experts with respect to any part of the Registration Statement within the meaning of the term “experts” as used in the Securities Act or the rules and regulations promulgated thereunder.

Very truly yours,

FENWICK & WEST LLP

EX-10.1

Exhibit 10.1

GRIDSUM HOLDING INC.

2014 STOCK OPTION PLAN

1.Purposes of the Plan.  The purposes of this Plan are to attract and retain the best available personnel, to provide additional incentives to Employees, Directors and Consultants and to promote the success of the Company’s business.

2.Definitions.  The following definitions shall apply as used herein and in the individual Share Option Agreements except as defined otherwise in an individual Share Option Agreement.  In the event a term is separately defined in an individual Share Option Agreement, such definition shall supersede the definition contained in this Section.

(a)“Administrator” means the Board or any of the Committees appointed to administer the Plan.

(b)“Affiliate” and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 promulgated under the Exchange Act.

(c)“Applicable Laws” means the legal requirements relating to the Plan and the Options under applicable provisions of the corporate and securities laws of any jurisdiction, the Code, the rules of any applicable stock exchange or national market system, and the rules of any jurisdiction applicable to Option granted to residents therein.

(d)“Board” means the Board of Directors of the Company.

(e)“Change in Control” means a change in ownership or control of the Company effected through either of the following transactions:

(i)the direct or indirect acquisition by any person or related group of persons (other than an acquisition from or by the Company or by a Company-sponsored employee benefit plan or by a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial ownership (within the meaning of Rule13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s shareholders which a majority of the Continuing Directors who are not Affiliates or Associates of the offeror do not recommend such shareholders accept, or

1

(ii)a change in the composition of the Board over a period of thirty-six (36) months or less such that a majority of the Board members (rounded up to the next whole number) ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who are Continuing Directors.

(f)“Code” means the Internal Revenue Code of 1986, as amended.

(g)“Committee” means any committee composed of members of the Board appointed by the Board to administer the Plan.

(h)“Common shares” means the voting common shares of the Company.

(i)“Company” means GRIDSUM HOLDING INC., a company incorporated in Cayman Islands.

(j)“Consultant” means any person (other than an Employee or a Director, solely with respect to rendering services in such person’s capacity as a Director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity.

(k)“Continuing Directors” means members of the Board who either (i) have been Board members continuously for a period of at least thirty-six (36) months or (ii) have been Board members for less than thirty-six (36) months and were elected or nominated for election as Board members by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was approved by the Board.

(l)“Continuous Service” means that the provision of services to the Company or a Related Entity in any capacity of Employee, Director or Consultant (collectively, “Service Provider”) is not interrupted or terminated.  In jurisdictions requiring notice in advance of an effective termination as an Employee, Director or Consultant, Continuous Service shall be deemed terminated upon the actual cessation of providing services to the Company or a Related Entity notwithstanding any required notice period that must be fulfilled before a termination as an Employee, Director or Consultant can be effective under Applicable Laws.  An Optionee’s Continuous Service shall be deemed to have terminated either upon an actual termination of Continuous Service or upon the entity for which the

2

Optionee provides services ceasing to be a Related Entity.  Continuous Service shall not be considered interrupted in the case of (i) any approved leave of absence, (ii) transfers among the Company, any Related Entity, or any successor, in any capacity of Employee, Director or Consultant, or (iii) any change in status as long as the individual remains in the service of the Company or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided in the Option Agreement).  An approved leave of absence shall include sick leave, military leave, or any other authorized personal leave.

(m)“Corporate Transaction” means any of the following transactions, provided, however, that the Administrator shall determine under parts (iv) and (v) whether multiple transactions are related, and its determination shall be final, binding and conclusive:

(i)a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in which the Company is incorporated;

(ii)the sale, transfer or other disposition of all or substantially all of the assets of the Company;

(iii)the complete liquidation or dissolution of the Company;

(iv)any reverse merger or series of related transactions culminating in a reverse merger (including, but not limited to, a tender offer followed by a reverse merger) in which the Company is the surviving entity but (A) the Common shares outstanding immediately prior to such merger are converted or exchanged by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than forty percent (40%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such merger or the initial transaction culminating in such merger, but excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction; or

(v)acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined

3

voting power of the Company’s outstanding securities but excluding any such transaction or series of related transactions that the Administrator determines shall not be a Corporate Transaction.

(n)“Director” means a member of the Board or the board of directors of any Related Entity.

(o)“Disability” means as defined under the long-term disability policy of the Company or the Related Entity to which the Optionee provides services regardless of whether the Optionee is covered by such policy.  If the Company or the Related Entity to which the Optionee provides service does not have a long-term disability plan in place, “Disability” means that an Optionee is unable to carry out the responsibilities and functions of the position held by the Optionee by reason of any medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days.  An Optionee will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Administrator in its discretion.

(p)“Employee” means any person, including an Officer or Director, who is in the employment of the Company or any Related Entity, subject to the control and direction of the Company or any Related Entity as to both the work to be performed and the manner and method of performance.  The payment of a director’s fee by the Company or a Related Entity shall not be sufficient to constitute “employment” by the Company.

(q)“Exchange Act” means the Securities Exchange Act of 1934, as amended.

(r)“Fair Market Value” means, as of any date, the value of Common shares determined as follows:

(i)If the Common shares are listed on one or more established stock exchanges or national market systems, including without limitation the American Stock Exchange or The Nasdaq Global Market, its Fair Market Value shall be the closing sales price for such shares (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Common shares are listed (as determined by the Administrator) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

4

(ii)If the Common shares are regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such shares as quoted on such system on the date of determination, but if selling prices are not reported, the Fair Market Value of the Common shares shall be the mean between the high bid and low asked prices for the Common shares on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or

(iii)In the absence of an established market for the Common shares of the type described in (i) and (ii), above, the Fair Market Value thereof shall be determined by the Administrator in good faith.

(s)“Officer” means a person who is an officer of the Company or a Related Entity within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(t)“Option” means an option to purchase Shares pursuant to an Option Agreement granted under the Plan.

(u)“Option Agreement” means the written agreement evidencing the grant of an Option executed by the Company and the Optionee, including any amendments thereto.

(v)“Optionee” means an Employee, Director or Consultant who receives an Option under the Plan.

(w)“Plan” means this 2014 Stock Option Plan.

(x)“Related Entity” means any Parent or Subsidiary of the Company and any business, corporation, partnership, limited liability company or other entity in which the Company or a Parent or a Subsidiary of the Company holds a substantial ownership interest, directly or indirectly.

(y)“Replaced” means that pursuant to a Corporate Transaction the Option is replaced with a comparable share or stock Option or a cash incentive program of the Company, the successor entity (if applicable) or Parent of either of them which preserves the compensation element of such Option existing at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same (or a more favorable) vesting

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schedule applicable to such Option.  The determination of Option comparability shall be made by the Administrator and its determination shall be final, binding and conclusive.

(z)“Share” means Common shares of the Company.

(aa)“Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f) of the Code.

3.Shares Subject to the Plan.

(a)Subject to the provisions of Section 10, below, the maximum aggregate number of Shares which may be issued pursuant to Option is 2,500,000 Shares.

(b)Any Shares covered by an Option (or portion of an Option) which is forfeited, canceled or expires (whether voluntarily or involuntarily) shall be deemed not to have been issued for purposes of determining the maximum aggregate number of Shares which may be issued under the Plan.  Shares that actually have been issued under the Plan pursuant to an Option shall not be returned to the Plan and shall not become available for future issuance under the Plan, except that if unvested Shares are forfeited, or repurchased by the Company at the lower of their original purchase price or their Fair Market Value at the time of repurchase, such Shares shall become available for future grant under the Plan.  To the extent not prohibited by the listing requirements of the American Stock Exchange, The Nasdaq Global Market (or other established stock exchange or national market system on which the Common shares are traded) and Applicable Law, any Shares covered by an Option which are surrendered (i) in payment of the Option exercise or purchase price or (ii) in satisfaction of tax withholding obligations incident to the exercise of an Option shall be deemed not to have been issued for purposes of determining the maximum number of Shares which may be issued pursuant to all Options under the Plan, unless otherwise determined by the Administrator.

4.Administration of the Plan.

(a)Plan Administrator.

(i)Administration with Respect to Directors and Officers.  With respect to grants of Options to Directors or Employees who are also Officers or Directors of the Company, the Plan shall be administered by (A) the Board or (B) a Committee

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designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws.  Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.

(ii)Administration With Respect to Consultants and Other Employees.  With respect to grants of Options to Employees or Consultants who are neither Directors nor Officers of the Company, the Plan shall be administered by (A) the Board or (B) a Committee designated by the Board, which Committee shall be constituted in such a manner as to satisfy the Applicable Laws.  Once appointed, such Committee shall continue to serve in its designated capacity until otherwise directed by the Board.  The Board may authorize one or more Officers to grant such Options and may limit such authority as the Board determines from time to time.

(iii)Administration Errors.  In the event an Option is granted in a manner inconsistent with the provisions of this subsection (a), such Option shall be presumptively valid as of its grant date to the extent permitted by the Applicable Laws.

(b)Powers of the Administrator.  Subject to Applicable Laws and the provisions of the Plan (including any other powers given to the Administrator hereunder), and except as otherwise provided by the Board, the Administrator shall have the authority, in its discretion:

(i)to select the Employees, Directors and Consultants to whom Options may be granted;

(ii)to determine whether and to what extent Options are granted hereunder;

(iii)to determine the number of Shares or the amount of other consideration to be covered by each Option granted hereunder;

(iv)to approve forms of Option Agreements for use under the Plan;

(v)to determine the terms and conditions of any Option granted hereunder;

(vi)to amend the terms of any outstanding Option granted under the Plan, provided that (A) any amendment that would adversely affect the Optionee’s rights under an outstanding Option shall not be made without the Optionee’s written

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consent, (B) the reduction of the exercise price of any Option Optioned under the Plan shall be subject to shareholder approval and (C) canceling an Option at a time when its exercise price exceeds the Fair Market Value of the underlying Shares, in exchange for another Option shall be subject to stockholder approval, unless the cancellation and exchange occurs in connection with a Corporate Transaction.  Notwithstanding the foregoing, canceling an Option in exchange for another Option with an exercise price, purchase price that is equal to or greater than the exercise price of the original Option shall not be subject to shareholder approval;

(vii)to construe and interpret the terms of the Plan and Options, including without limitation, any notice of Option or Option Agreement, granted pursuant to the Plan;

(viii)to take such other action, not inconsistent with the terms of the Plan, as the Administrator deems appropriate.

(c)Indemnification. In addition to such other rights of indemnification as they may have as members of the Board or as Officers or Employees of the Company or a Related Entity, members of the Board and any Officers or Employees of the Company or a Related Entity to whom authority to act for the Board, the Administrator or the Company is delegated shall be defended and indemnified by the Company to the extent permitted by law on an after-tax basis against all reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with the defense of any claim, investigation, action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan, or any Option granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by the Company) or paid by them in satisfaction of a judgment in any such claim, investigation, action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such claim, investigation, action, suit or proceeding that such person is liable for gross negligence, bad faith or intentional misconduct; provided, however, that within thirty (30) days after the institution of such claim, investigation, action, suit or proceeding, such person shall offer to the Company, in writing, the opportunity at the Company’s expense to defend the same.

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5.Eligibility.  The Optionees shall be such persons as the Administrator may select from among the Employee and Consultants.

6.Terms and Conditions of Options.

(a)Designation of Option.  Each Option shall be designated in the Option Agreement.

(b)Conditions of Option.  Subject to the terms of the Plan, the Administrator shall determine the provisions, terms, and conditions of each Option including, but not limited to, the Option vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, Shares, or other consideration) upon settlement of the Option, payment contingencies.

(c)Deferral of Option Payment.  The Administrator may establish one or more programs under the Plan to permit selected Optionees the opportunity to elect to defer receipt of consideration upon exercise of an Option, or other event that absent the election would entitle the Optionee to payment or receipt of Shares or other consideration under an Option.  The Administrator may establish the election procedures, the timing of such elections, the mechanisms for payments of, and accrual of interest or other earnings, if any, on amounts, Shares or other consideration so deferred, and such other terms, conditions, rules and procedures that the Administrator deems advisable for the administration of any such deferral program.

(d)Early Exercise.  The Option Agreement may, but need not, include a provision whereby the Optionee may elect at any time while an Employee, Director or Consultant to exercise any part or all of the Option prior to full vesting of the Option.  Any unvested Shares received pursuant to such exercise may be subject to a repurchase right in favor of the Company or a Related Entity or to any other restriction the Administrator determines to be appropriate.

(e)Term of Option.  The term of each Option shall be the term stated in the Option Agreement.

(f)Transferability of Options Options shall be transferable (i) by will and by the laws of descent and distribution and (ii) during the lifetime of the Optionee, to the extent and in the manner authorized by the Administrator.  Notwithstanding the foregoing,

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the Optionee may designate one or more beneficiaries of the Optionee’s Option in the event of the Optionee’s death on a beneficiary designation form provided by the Administrator.

(g)Termination of Employment Other than by Death or Disability.

(i)If an Optionee ceases to be an Employee for any reason other than his or her death or disability, the Optionee shall have the right, subject to the provisions of this Section 6, to exercise any option held by the Optionee at any time within ninety (90) days after his or her termination of employment, but not beyond the otherwise applicable term of the Option and only to the extent that on such date of termination of employment the Optionee’s right to exercise such Option had vested.

(ii)For purposes of this Section 6(g), the employment relationship shall be treated as continuing intact while the Optionee is an active employee of the Company or any Affiliate, or is on military leave, sick leave, or other bona fide leave of absence to be determined in the sole discretion of the Administrator.

(h)Death of Optionee.

If an Optionee dies while an Employee, or after ceasing to be an Employee but during the period while he or she could have exercised an Option under Section 6(h), any Option granted to the Optionee may be exercised, to the extent it had vested at the time of death and subject to the Plan, at any time within twelve (12) months after the Optionee’s death, by the executors or administrators of his or her estate or by any person or persons who acquire the option by will or the laws of descent and distribution, but not beyond the otherwise applicable term of the Option.

(i)Disability of Optionee.

If an Optionee ceases to be an Employee due to becoming totally and permanently disabled within the meaning of Section 22(e)(3) of the Code, any Option granted to the Optionee may be exercised to the extent it had vested at the time of cessation and, subject to the Plan, at any time within twelve (12) months after the Optionee’s termination of employment, but not beyond the otherwise applicable term of the option.

(j)Time of Granting Options.  The date of grant of an Option shall for all purposes be on the date which the Administrator makes the determination to grant such Option, or such other date as is determined by the Administrator.

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7.Option Exercise or Purchase Price, Consideration and Taxes.

(a)Exercise or Purchase Price.  The Administrator shall determine the exercise or purchase price pursuant to the Security Purchase Agreement dated as of September 6, 2010 between the Company and investors.

(b)Consideration.  Subject to Applicable Laws, the consideration to be paid for the Shares to be issued upon exercise or purchase of an Option including the method of payment shall be determined by the Administrator. In addition to any other types of consideration the Administrator may determine, the Administrator is authorized to accept as consideration for Shares issued under the Plan the following:

(i)cash;

(ii)check;

(iii)with respect to Options, payment through a broker-dealer sale and remittance procedure pursuant to which the Optionee (A) shall provide written instructions to a Company designated brokerage firm to effect the immediate sale of some or all of the purchased Shares and remit to the Company sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (B) shall provide written directives to the Company to deliver the certificates for the purchased Shares directly to such brokerage firm in order to complete the sale transaction; or

(iv)any combination of the foregoing methods of payment.

(c)Taxes.  No Shares shall be delivered under the Plan to any Optionee or other person until such Optionee or other person has made arrangements acceptable to the Administrator for the satisfaction of any national, provincial or local income and employment tax withholding obligations.  Upon exercise of an Option the Company shall withhold or collect from Optionee an amount sufficient to satisfy such tax obligations.

8.Exercise of Option.

(a)Procedure for Exercise; Rights as a Shareholder.

(i)Any Option granted hereunder shall be exercisable at such times and under such conditions as determined by the Administrator under the terms of the Plan and specified in the Option Agreement.

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(ii)An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Option by the person entitled to exercise the Option and full payment for the Shares with respect to which the Option is exercised, including, to the extent selected, use of the broker-dealer sale and remittance procedure to pay the purchase price as provided in Section 7(b)(iii).

9.Conditions Upon Issuance of Shares.

(a)Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all Applicable Laws, and shall be further subject to the approval of counsel for the Company with respect to such compliance.

(b)As a condition to the exercise of an Option, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any Applicable Laws.

10.Adjustments Upon Changes in Capitalization.

Subject to any required action by the shareholders of the Company, the number of Shares covered by each outstanding Option, and the number of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan, the exercise or purchase price of each such outstanding Option, the maximum number of Shares with respect to which Options may be granted to any Optionee in any fiscal year of the Company, as well as any other terms that the Administrator determines require adjustment shall be proportionately adjusted for (i) any increase or decrease in the number of issued Shares resulting from a share split, reverse share split, share dividend, combination or reclassification of the Shares, or similar transaction affecting the Shares, (ii) any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company, or (iii) as the Administrator may determine in its discretion, any other transaction with respect to

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Common shares including a corporate merger, consolidation, acquisition of property or equity, separation (including a spin-off or other distribution of shares or property), reorganization, liquidation (whether partial or complete) or any similar transaction; provided, however that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.”  Such adjustment shall be made by the Administrator and its determination shall be final, binding and conclusive.  Except as the Administrator determines, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason hereof shall be made with respect to, the number or price of Shares subject to an Option.  In the event of a Spin-off Transaction, the Administrator may in its discretion make such adjustments and take such other action as it deems appropriate with respect to outstanding Options under the Plan, including but not limited to: (i) adjustments to the number and kind of shares, the exercise or purchase price per share and the vesting periods of outstanding Options, (ii) prohibit the exercise of Options during certain periods of time prior to the consummation of the Spin-off Transaction, or (iii) the substitution, exchange or grant of Options to purchase securities of the Subsidiary; provided that the Administrator shall not be obligated to make any such adjustments or take any such action hereunder.

11.Corporate Transactions and Changes in Control.

(a)Termination of Option to Extent Not Assumed in Corporate Transaction. Effective upon the consummation of a Corporate Transaction, all outstanding Options under the Plan shall terminate.  However, all such Options shall not terminate to the extent they are Assumed in connection with the Corporate Transaction.

(b)Acceleration of Option Upon Corporate Transaction or Change in Control.

(i)Corporate Transaction.  The Administrator may determine, in the event of a Corporate Transaction, for the portion of each Option that is neither Assumed nor Replaced, such portion of the Option shall automatically become fully vested and exercisable and be released from any repurchase or forfeiture rights (other than repurchase rights exercisable at Fair Market Value) for all of the Shares (or other consideration) at the time represented by such portion of the Option, immediately prior to the specified effective

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date of such Corporate Transaction, provided that the Optionee’s Continuous Service has not terminated prior to such date.

(ii)Change in Control.  The Administrator may determine, in the event of a Change in Control (other than a Change in Control which also is a Corporate Transaction), each Option which is at the time outstanding under the Plan automatically shall become fully vested and exercisable and be released from any repurchase or forfeiture rights (other than repurchase rights exercisable at Fair Market Value), immediately prior to the specified effective date of such Change in Control, for all of the Shares (or other consideration) at the time represented by such Option, provided that the Optionee’s Continuous Service has not terminated prior to such date.

12.Effective Date and Term of Plan.  The Plan shall become effective upon the earlier to occur of its adoption by the Board or its approval by the shareholders of the Company.  It shall continue in effect for a term of five (5) years unless sooner terminated.  Subject to Section 17, below, and Applicable Laws, Options may be granted under the Plan upon its becoming effective.

13.Amendment, Suspension or Termination of the Plan.

(a)The Board may at any time amend, suspend or terminate the Plan; provided, however, that no such amendment shall be made without the approval of the Company’s shareholders to the extent such approval is required by Applicable Laws, or if such amendment would change any of the provisions of Section 3(a), Section 4(b)(vi) or this Section 13(a).

(b)No Option may be granted during any suspension of the Plan or after termination of the Plan.

(c)No suspension or termination of the Plan (including termination of the Plan under Section 12, above) shall adversely affect any rights under Options already granted to an Optionee.

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14.Reservation of Shares.

(a)The Company, during the term of the Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.

(b)The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

15.No Effect on Terms of Employment/Consulting Relationship.  The Plan shall not confer upon any Optionee any right with respect to the Optionee’s Continuous Service, nor shall it interfere in any way with his or her right or the right of the Company or any Related Entity to terminate the Optionee’s Continuous Service at any time, with or without Cause, and with or without notice.  The ability of the Company or any Related Entity to terminate the employment of an Optionee who is employed at will is in no way affected by its determination that the Optionee’s Continuous Service has been terminated for Cause for the purposes of this Plan.

16.No Effect on Retirement and Other Benefit Plans.  Except as specifically provided in a retirement or other benefit plan of the Company or a Related Entity, Options shall not be deemed compensation for purposes of computing benefits or contributions under any retirement plan of the Company or a Related Entity, and shall not affect any benefits under any other benefit plan of any kind or any benefit plan subsequently instituted under which the availability or amount of benefits is related to level of compensation.  The Plan is not a “Retirement Plan” or “Welfare Plan” under the Employee Retirement Income Security Act of 1974, as amended.

17.Shareholder Approval.  The grant of Options under the Plan shall be subject to approval by the shareholders of the Company.  Such shareholder approval shall be obtained in the degree and manner required under Applicable Laws.  The Administrator

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may grant Options under the Plan prior to approval by the shareholders, but until such approval is obtained, no such Option shall be exercisable.

18.Unfunded Obligation.  Optionees shall have the status of general unsecured creditors of the Company.  Any amounts payable to Optionees pursuant to the Plan shall be unfunded and unsecured obligations for all purposes, including, without limitation, Title I of the Employee Retirement Income Security Act of 1974, as amended.  Neither the Company nor any Related Entity shall be required to segregate any monies from its general funds, or to create any trusts, or establish any special accounts with respect to such obligations.  The Company shall retain at all times beneficial ownership of any investments, including trust investments, which the Company may make to fulfill its payment obligations hereunder.  Any investments or the creation or maintenance of any trust or any Optionee account shall not create or constitute a trust or fiduciary relationship between the Administrator, the Company or any Related Entity and an Optionee, or otherwise create any vested or beneficial interest in any Optionee or the Optionee’s creditors in any assets of the Company or a Related Entity. The Optionees shall have no claim against the Company or any Related Entity for any changes in the value of any assets that may be invested or reinvested by the Company with respect to the Plan.

19.Construction.  Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of the Plan.  Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular.  Use of the term “or” is not intended to be exclusive, unless the context clearly requires otherwise.

20.Information to Optionees. Each Optionee shall be provided with such information regarding the Company as the Board or the Committee from time to time deems necessary or appropriate; provided, however, that each Optionee shall at all times be provided with such information as is required to be provided from time to time pursuant to applicable regulatory requirements.

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EX-10.2

Exhibit 10.2

GRIDSUM HOLDING INC.

2016 EQUITY INCENTIVE PLAN

1.PURPOSE.  The purpose of this Plan is to provide incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of the Company, and any Parents, Subsidiaries and Affiliates that exist now or in the future, by offering them an opportunity to participate in the Company’s future performance through the grant of Awards.  Capitalized terms not defined elsewhere in the text are defined in Section 27.

2.SHARES SUBJECT TO THE PLAN.

2.1.Number of Shares Available.  Subject to Sections 2.7 and 21 and any other applicable provisions hereof, the maximum aggregate number of Shares reserved and available for grant and issuance pursuant to this Plan as of the date of adoption of the Plan by the Board, is (a) 2,500,000 Shares, plus (b) shares that are subject to share options or other awards granted under the Company’s 2014 Stock Option Plan (the “Prior Plan”) that cease to be subject to such share options or other awards by forfeiture or otherwise after the Effective Date, (c) shares issued under the Prior Plan that are repurchased by the Company and (d) unissued shares that are subject to share options or other awards under the Prior Plan that are used to pay the exercise price of an option or withheld to satisfy the tax withholding obligations related to any Award.

2.2.Lapsed, Returned Awards.  Shares subject to Awards, and Shares issued under the Plan under any Award, will again be available for grant and issuance in connection with subsequent Awards under this Plan to the extent such Shares:  (a) are subject to issuance upon exercise of an Option or SAR granted under this Plan but which cease to be subject to the Option or SAR for any reason other than exercise of the Option or SAR; (b) are subject to Awards granted under this Plan that are forfeited or are repurchased by the Company; (c) are subject to Awards granted under this Plan that otherwise terminate without such Shares being issued; or (d) are surrendered pursuant to an Exchange Program.  To the extent an Award under the Plan is paid out in cash or other property rather than Shares, such cash payment will not result in reducing the number of Shares available for issuance under the Plan.  Unissued Shares used to pay the exercise price of an Award or withheld to satisfy the tax withholding obligations related to an Award will become available for future grant or sale under the Plan.  For the avoidance of doubt, Shares that otherwise become available for grant and issuance because of the provisions of this Section 2.2 shall not include Shares subject to Awards that initially became available because of the substitution clause in Section 21.2 hereof.

2.3.Minimum Share Reserve.  At all times the Company shall reserve and keep available a sufficient number of Shares as shall be required to satisfy the requirements of all outstanding Awards granted under this Plan.

2.4.Automatic Share Reserve Increase.  The number of Shares available for grant and issuance under the Plan shall be increased on January 1, of each of the calendar years 2017 through 2026, by the lesser of (a) two and one-half percent (2.5%) of the number of Shares issued and outstanding on each December 31 immediately prior to the date of increase or (b) such number of Shares determined by the Board.

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2.5.Limitations.  No more than 5,000,000 Shares shall be issued pursuant to the exercise of ISOs.

2.6.Application to ADS.  For purposes of calculating the number of Shares issued under this Plan (and for purposes of calculating any other Share limit set forth herein), the issuance of an ADS shall be deemed to equal one Share, provided, however, that if the number of Shares represented by an ADS is other than on a one-to-one basis, the number of Shares issued under this Plan (and any other Share limit set forth herein) shall be adjusted to reflect such issuance of ADS.

2.7.Adjustment of Shares.  If the number of outstanding Shares is changed by a share dividend, recapitalization, share split, reverse share split, subdivision, combination, reclassification or similar change in the capital structure of the Company, without consideration, then (a) the number of Shares reserved for issuance and future grant under the Plan set forth in Section 2.1, (b) the Exercise Prices of and number of Shares subject to outstanding Options and SARs, (c) the number of Shares subject to other outstanding Awards, and (d) the maximum number of Shares that may be issued pursuant to the exercise of ISOs set forth in Section 2.5, shall be proportionately adjusted, subject to any required action by the Board or the shareholders of the Company and in compliance with applicable securities laws; provided that fractions of a Share will not be issued.

3.ELIGIBILITY.  ISOs may be granted only to Employees.  All other Awards may be granted to Employees, Consultants and Directors; provided that such Consultants and Directors render bona fide services not in connection with the offer and sale of securities in a capital-raising transaction.

4.ADMINISTRATION.

4.1.Committee Composition; Authority.  This Plan will be administered by the Committee or by the Board acting as the Committee.  Subject to the general purposes, terms and conditions of this Plan, and to the direction of the Board, the Committee will have full power to implement and carry out this Plan.  The Committee will have the authority to:

(a)construe and interpret this Plan, any Award Agreement and any other agreement or document executed pursuant to this Plan;

(b)prescribe, amend and rescind rules and regulations relating to this Plan or any Award;

(c)select persons to receive Awards;

(d)determine the form and terms and conditions, not inconsistent with the terms of the Plan, of any Award granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Awards may vest and be exercised (which may be based on performance criteria) or settled, any vesting acceleration or waiver of forfeiture restrictions, the method to satisfy tax withholding obligations or any other tax liability legally due and any restriction or limitation regarding any Award or the Shares relating thereto, based in each case on such factors as the Committee will determine;

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(e)determine the number of Shares or other consideration subject to Awards;

(f)determine the Fair Market Value in good faith and interpret the applicable provisions of this Plan and the definition of Fair Market Value in connection with circumstances that impact the Fair Market Value, if necessary;

(g)determine whether Awards will be granted singly, in combination with, in tandem with, in replacement of, or as alternatives to, other Awards under this Plan or any other incentive or compensation plan of the Company or any Parent, Subsidiary, Related Entity or Affiliate;

(h)grant waivers of Plan or Award conditions;

(i)determine the vesting, exercisability and payment of Awards;

(j)correct any defect, supply any omission or reconcile any inconsistency in this Plan, any Award or any Award Agreement;

(k)determine whether an Award has been earned;

(l)determine the terms and conditions of any, and to institute any Exchange Program;

(m)reduce or waive any criteria with respect to Performance Factors;

(n)adjust Performance Factors to take into account changes in law and accounting or tax rules as the Committee deems necessary or appropriate to reflect the impact of extraordinary or unusual items, events or circumstances to avoid windfalls or hardships;

(o)adopt rules and/or procedures (including the adoption of any subplan under this Plan) relating to the operation and administration of the Plan to accommodate requirements of local law and procedures outside of the United States;

(p)make all other determinations necessary or advisable for the administration of this Plan;

(q)delegate any of the foregoing to a subcommittee consisting of one or more executive officers pursuant to a specific delegation as permitted by Applicable Law; and

(r)exercise negative discretion on Performance Awards, reducing or eliminating the amount to be paid to Participants.

4.2.Committee Interpretation and Discretion.  Any determination made by the Committee with respect to any Award shall be made in its sole discretion at the time of grant of the Award or, unless in contravention of any express term of the Plan or Award, at any later time, and such determination shall be final and binding on the Company and all persons having an interest in any Award under the Plan.  Any dispute regarding the interpretation of the Plan or any Award Agreement shall be submitted by the Participant or Company to the Committee for

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review.  The resolution of such a dispute by the Committee shall be final and binding on the Company and the Participant.  The Committee may delegate to one or more executive officers the authority to review and resolve disputes with respect to any Awards, and such resolution shall be final and binding on the Company and the Participant.

4.3.Documentation.  The Award Agreement for a given Award, the Plan and any other documents may be delivered to, and accepted by, a Participant or any other person in any manner (including electronic distribution or posting) that meets applicable legal requirements.

4.4.Jurisdictions.  Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in countries in which the Company and its Subsidiaries, Related Entities and Affiliates operate or have employees or other individuals eligible for Awards, the Committee, in its sole discretion, shall have the power and authority to:  (a) determine which Subsidiaries, Related Entities and Affiliates shall be covered by the Plan; (b) determine which individuals are eligible to participate in the Plan; (c) modify the terms and conditions of any Award granted to individuals to comply with Applicable Laws; (d) establish subplans and modify exercise procedures and other terms and procedures, to the extent the Committee determines such actions to be necessary or advisable (and such subplans and/or modifications shall be attached to this Plan as appendices); provided, however, that no such subplans and/or modifications shall increase the share limitations contained in Section 2.1 hereof; and (e) take any action, before or after an Award is made, that the Committee determines to be necessary or advisable to obtain approval or comply with any local governmental regulatory exemptions or approvals.  Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate the Exchange Act or any other applicable United States securities law, the Code, or any other applicable governing statute or law.

5.OPTIONS.  An Option is the right but not the obligation to purchase a Share, subject to certain conditions, if applicable.  The Committee may grant Options to eligible Employees, Consultants and Directors and will determine whether such Options will be incentive stock options within the meaning of the Code (“ISOs”) or Nonqualified Share options (“NSOs”), the number of Shares subject to the Option, the Exercise Price of the Option, the period during which the Option may vest and be exercised, and all other terms and conditions of the Option, subject to the following terms of this section.

5.1.Option Grant.  Each Option granted under this Plan will identify the Option as an ISO or an NSO.  An Option may be, but need not be, awarded upon satisfaction of such Performance Factors during any Performance Period as are set out in advance in the Participant’s individual Award Agreement.  If the Option is being earned upon the satisfaction of Performance Factors, then the Committee will: (a) determine the nature, length and starting date of any Performance Period for each Option; and (b) select from among the Performance Factors to be used to measure the performance, if any.  Performance Periods may overlap and Participants may participate simultaneously with respect to Options that are subject to different performance goals and other criteria.

5.2.Date of Grant.  The date of grant of an Option will be the date on which the Committee makes the determination to grant such Option, or a specified future date.  The Award

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Agreement and a copy of this Plan will be delivered to the Participant within a reasonable time after the granting of the Option.

5.3.Exercise Period.  Options may be vested and exercisable within the times or upon the conditions as set forth in the Award Agreement governing such Option; provided, however, that no Option will be exercisable after the expiration of ten (10) years from the date the Option is granted; provided, further, that no ISO granted to a person who, at the time the ISO is granted, directly or by attribution owns more than ten percent (10%) of the total combined voting power of all classes of shares of the Company or of any Parent or Subsidiary (“Ten Percent Shareholder”) will be exercisable after the expiration of five (5) years from the date the ISO is granted.  The Committee also may provide for Options to become exercisable at one time or from time to time, periodically or otherwise, in such number of Shares or percentage of Shares as the Committee determines.

5.4.Exercise Price.  The Exercise Price per Share subject to an Option will be determined by the Committee when the Option is granted and set forth in the Award Agreement and may be a fixed or variable price related to the Fair Market Value of the Shares; provided that the Exercise Price of any ISO granted to a Ten Percent Shareholder will not be less than one hundred ten percent (110%) of the Fair Market Value of the Shares on the date of grant.  Payment for the Shares purchased may be made in accordance with Section 11 and the Award Agreement and in accordance with any procedures established by the Company. The exercise price per Share subject to an Option may be amended or adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive. For the avoidance of doubt, to the extent not prohibited by Applicable Laws, a downward adjustment of the exercise prices of Options mentioned in the preceding sentence shall be effective without the approval of the Company’s shareholders or the approval of the affected Participants.

5.5.Method of Exercise.  Any Option granted hereunder will be vested and exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Committee and set forth in the Award Agreement. An Option may not be exercised for a fraction of a Share.  An Option will be deemed exercised when the Company receives: (a) notice of exercise (in such form as the Committee may specify from time to time) from the person entitled to exercise the Option, and (b) full payment for the Shares with respect to which the Option is exercised (together with applicable withholding taxes). Full payment may consist of any consideration and method of payment authorized by the Committee and permitted by the Award Agreement and the Plan. Shares issued upon exercise of an Option will be issued in the name of the Participant. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder will exist with respect to the Shares, notwithstanding the exercise of the Option. The Company will issue (or cause to be issued) such Shares promptly after the Option is exercised.  No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 2.7 of the Plan. Exercising an Option in any manner will decrease the number of Shares thereafter available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised.

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5.6.Termination of Service.  If the Participant’s Service terminates for any reason except for Cause or the Participant’s death or Disability, then the Participant may exercise such Participant’s Options only to the extent that such Options would have been exercisable by the Participant on the date Participant’s Service terminates no later than three (3) months after the date Participant’s Service terminates (or such shorter or longer time period as may be determined by the Committee, with any exercise beyond three (3) months after the date Participant’s Service terminates deemed to be the exercise of an NSO), but in any event no later than the expiration date of the Options.

(a)Death.  If the Participant’s Service terminates because of the Participant’s death (or the Participant dies within three (3) months after the Participant’s Service terminates other than for Cause or because of the Participant’s Disability), then the Participant’s Options may be exercised only to the extent that such Options would have been exercisable by the Participant on the date Participant’s Service terminates, and must be exercised by the Participant’s legal representative or authorized assignee, no later than twelve (12) months after the date the Participant’s Service terminates (or such shorter time period not less than six (6) months or longer time period as may be determined by the Committee), but in any event no later than the expiration date of the Options.

(b)Disability.  If the Participant’s Service terminates because of the Participant’s Disability, then the Participant’s Options may be exercised only to the extent that such Options would have been exercisable by the Participant on the date Participant’s Service terminates and must be exercised by the Participant (or the Participant’s legal representative or authorized assignee) no later than twelve (12) months after the date the Participant’s Service terminates, but in any event no later than the expiration date of the Options.

(c)Cause.  If the Participant is terminated for Cause, then the Participant’s Options shall expire on such Participant’s date of termination of Service, or at such later time and on such conditions as are determined by the Committee, but in no event later than the expiration date of the Options.  Unless otherwise provided in the Award Agreement, Cause shall have the meaning set forth in the Plan.

5.7.Limitations on Exercise.  The Committee may specify a minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent any Participant from exercising the Option for the full number of Shares for which it is then exercisable.

5.8.Limitations on ISOs.  ISOs may only be granted to employees of the Company or to employees of a “parent corporation” or a “subsidiary corporation” of the Company as those terms are defined in Section 424 of the Code.  With respect to Awards granted as ISOs, to the extent that the aggregate Fair Market Value of the Shares with respect to which such ISOs are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds one hundred thousand dollars (US$100,000), such Options will be treated as NSOs.  For purposes of this Section 5.8, ISOs will be taken into account in the order in which they were granted.  The Fair Market Value of the Shares will be determined as of the time the Option with respect to such Shares is granted.  In the event that the Code or the regulations promulgated thereunder are amended after the Effective Date to provide

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for a different limit on the Fair Market Value of Shares permitted to be subject to ISOs, such different limit will be automatically incorporated herein and will apply to any Options granted after the effective date of such amendment.

5.9.Modification, Extension or Renewal.  The Committee may modify, extend or renew outstanding Options and authorize the grant of new Options in substitution therefor, provided that any such action may not, without the written consent of a Participant, impair any of such Participant’s rights under any Option previously granted.  Any outstanding ISO that is modified, extended, renewed or otherwise altered will be treated in accordance with Section 424(h) of the Code.  Subject to Section 18 of this Plan, by written notice to affected Participants, the Committee may reduce the Exercise Price of outstanding Options without the consent of such Participants; provided, however, that the Exercise Price may not be reduced below the Fair Market Value of the Shares on the date the action is taken to reduce the Exercise Price.

5.10.No Disqualification.  Notwithstanding any other provision in this Plan, no term of this Plan relating to ISOs will be interpreted, amended or altered, nor will any discretion or authority granted under this Plan be exercised, so as to disqualify this Plan under Section 422 of the Code or, without the consent of the Participant affected, to disqualify any ISO under Section 422 of the Code.

6.RESTRICTED SHARE AWARDS.  A Restricted Share Award is an offer by the Company to sell to an eligible Employee, Consultant or Director Shares that are subject to restrictions (“Restricted Share”).  The Committee will determine to whom an offer will be made, the number of Shares the Participant may purchase, the Purchase Price, the restrictions under which the Shares will be subject and all other terms and conditions of the Restricted Share Award, subject to the Plan.

6.1.Restricted Share Purchase Agreement.  All purchases under a Restricted Share Award will be evidenced by an Award Agreement.  Except as may otherwise be provided in an Award Agreement, a Participant accepts a Restricted Share Award by signing and delivering to the Company an Award Agreement with full payment of the Purchase Price, within thirty (30) days from the date the Award Agreement was delivered to the Participant.  If the Participant does not accept such Award within thirty (30) days, then the offer of such Restricted Share Award will terminate, unless the Committee determines otherwise.

6.2.Purchase Price.  The Purchase Price for a Restricted Share Award will be determined by the Committee and may be less than Fair Market Value of a Share on the date the Restricted Share Award is granted.  Payment of the Purchase Price must be made in accordance with Section 11 of the Plan, and the Award Agreement and in accordance with any procedures established by the Company.

6.3.Terms of Restricted Share Awards.  Restricted Share Awards will be subject to such restrictions as the Committee may impose or are required by law.  These restrictions may be based on completion of a specified number of years of service with the Company or upon completion of Performance Factors, if any, during any Performance Period as set out in advance in the Participant’s Award Agreement.  Prior to the grant of a Restricted Share Award, the Committee shall: (a) determine the nature, length and starting date of any Performance Period for

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the Restricted Share Award; (b) select from among the Performance Factors to be used to measure performance goals, if any; and (c) determine the number of Shares that may be awarded to the Participant.  Performance Periods may overlap and a Participant may participate simultaneously with respect to Restricted Share Awards that are subject to different Performance Periods and having different performance goals and other criteria.

6.4.Termination of Service.  Except as may be set forth in the Participant’s Award Agreement, vesting ceases on such date Participant’s Service terminates (unless determined otherwise by the Committee).

7.SHARE BONUS AWARDS.  A Share Bonus Award is an Award to an eligible Employee, Consultant or Director of Shares for Services to be rendered or for past Services already rendered to the Company or any Parent, Subsidiary, Related Entity or Affiliate.  All Share Bonus Awards shall be made pursuant to an Award Agreement.  No payment from the Participant will be required for Shares awarded pursuant to a Share Bonus Award.

7.1.Terms of Share Bonus Awards.  The Committee will determine the number of Shares to be awarded to the Participant under a Share Bonus Award and any restrictions thereon.  These restrictions may be based upon completion of a specified number of years of service with the Company or upon satisfaction of performance goals based on Performance Factors during any Performance Period as set out in advance in the Participant’s Share Bonus Agreement.  Prior to the grant of any Share Bonus Award, the Committee shall: (a) determine the nature, length and starting date of any Performance Period for the Share Bonus Award; (b) select from among the Performance Factors to be used to measure performance goals; and (c) determine the number of Shares that may be awarded to the Participant.  Performance Periods may overlap and a Participant may participate simultaneously with respect to Share Bonus Awards that are subject to different Performance Periods and different performance goals and other criteria.

7.2.Form of Payment to Participant.  Payment may be made in the form of cash, whole Shares, or a combination thereof, based on the Fair Market Value of the Shares earned under a Share Bonus Award on the date of payment, as determined in the sole discretion of the Committee.

7.3.Termination of Service.  Except as may be set forth in the Participant’s Award Agreement, vesting ceases on such date Participant’s Service terminates (unless determined otherwise by the Committee).

8.SHARE APPRECIATION RIGHTS.  A Share Appreciation Right (“SAR”) is an Award to an eligible Employee, Consultant or Director that may be settled in cash or Shares (which may consist of Restricted Share), having a value equal to (a) the difference between the Fair Market Value of a Share on the date of exercise over the Exercise Price multiplied by (b) the number of Shares with respect to which the SAR is being settled (subject to any maximum number of Shares that may be issuable as specified in an Award Agreement).  All SARs shall be made pursuant to an Award Agreement.

8.1.Terms of SARs.  The Committee will determine the terms of each SAR including, without limitation: (a) the number of Shares subject to the SAR; (b) the Exercise Price and the

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time or times during which the SAR may be settled; (c) the consideration to be distributed on settlement of the SAR; and (d) the effect of the Participant’s termination of Service on each SAR.  The Exercise Price of the SAR will be determined by the Committee when the SAR is granted, and may not be less than Fair Market Value of a Share.  A SAR may be awarded upon satisfaction of Performance Factors, if any, during any Performance Period as are set out in advance in the Participant’s individual Award Agreement.  If the SAR is being earned upon the satisfaction of Performance Factors, then the Committee will: (x) determine the nature, length and starting date of any Performance Period for each SAR; and (y) select from among the Performance Factors to be used to measure the performance, if any.  Performance Periods may overlap and Participants may participate simultaneously with respect to SARs that are subject to different Performance Factors and other criteria.

8.2.         Exercise Period and Expiration Date.  A SAR will be exercisable within the times or upon the occurrence of events determined by the Committee and set forth in the Award Agreement governing such SAR.  The SAR Agreement shall set forth the expiration date; provided that no SAR will be exercisable after the expiration of ten (10) years from the date the SAR is granted.  The Committee may also provide for SARs to become exercisable at one time or from time to time, periodically or otherwise (including, without limitation, upon the attainment during a Performance Period of performance goals based on Performance Factors), in such number of Shares or percentage of the Shares subject to the SAR as the Committee determines.  Notwithstanding the foregoing, the rules of Section 5.6 also will apply to SARs.

8.3.         Form of Settlement.  Upon exercise of a SAR, a Participant will be entitled to receive payment from the Company in an amount determined by multiplying (a) the difference between the Fair Market Value of a Share on the date of exercise over the Exercise Price; times (b) the number of Shares with respect to which the SAR is exercised. At the discretion of the Committee, the payment from the Company for the SAR exercise may be in cash, in Shares of equivalent value, or in some combination thereof.  The portion of a SAR being settled may be paid currently or on a deferred basis with such interest or dividend equivalent, if any, as the Committee determines, provided that the terms of the SAR and any deferral satisfy the requirements of Section 409A of the Code, to the extent a Participant is subject to Section 409A of the Code.

8.4.         Termination of Service.  Except as may be set forth in the Participant’s Award Agreement, vesting ceases on such date Participant’s Service terminates (unless determined otherwise by the Committee).

9.             RESTRICTED SHARE UNITS.  A Restricted Share Unit (“RSU”) is an Award to an eligible Employee, Consultant or Director covering a number of Shares that may be settled in cash, or by issuance of those Shares (which may consist of Restricted Share).  All RSUs shall be made pursuant to an Award Agreement.

9.1.         Terms of RSUs.  The Committee will determine the terms of an RSU including, without limitation: (a) the number of Shares subject to the RSU; (b) the time or times during which the RSU may be settled; (c) the consideration to be distributed on settlement; and (d) the effect of the Participant’s termination of Service on each RSU; provided that no RSU shall have a term longer than ten (10) years.  An RSU may be awarded upon satisfaction of such

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performance goals based on Performance Factors during any Performance Period as are set out in advance in the Participant’s Award Agreement.  If the RSU is being earned upon satisfaction of Performance Factors, then the Committee will: (x) determine the nature, length and starting date of any Performance Period for the RSU; (y) select from among the Performance Factors to be used to measure the performance, if any; and (z) determine the number of Shares deemed subject to the RSU.  Performance Periods may overlap and participants may participate simultaneously with respect to RSUs that are subject to different Performance Periods and different performance goals and other criteria.

9.2.         Form and Timing of Settlement.  Payment of earned RSUs shall be made as soon as practicable after the date(s) determined by the Committee and set forth in the Award Agreement. The Committee, in its sole discretion, may settle earned RSUs in cash, Shares, or a combination of both.  The Committee may also permit a Participant to defer payment under a RSU to a date or dates after the RSU is earned, provided that, to the extent a Participant is subject to Section 409A of the Code, the terms of the RSU and any deferral shall satisfy the requirements of Section 409A of the Code.

9.3.         Termination of Service.  Except as may be set forth in the Participant’s Award Agreement, vesting ceases on such date Participant’s Service terminates (unless determined otherwise by the Committee).

10.          PERFORMANCE AWARDS.  A Performance Award is an Award to an eligible Employee, Consultant or Director of an award of Performance Shares or Performance Units.  Grants of Performance Awards shall be made pursuant to an Award Agreement.

10.1.       Types of Performance Awards. Performance Awards shall include Performance Shares and Performance Units as set forth in Sections 10.1(a) and 10.1(b) below.

(a)           Performance Shares.  The Committee may grant Awards of Performance Shares, designate the Participants to whom Performance Shares are to be awarded and determine the number of Performance Shares and the terms and conditions of each such Award. Performance Shares shall consist of a unit valued by reference to a designated number of Shares, the value of which may be paid to the Participant by delivery of Shares or, if set forth in the instrument evidencing the Award, of such property as the Committee shall determine, including, without limitation, cash, Shares, other property, or any combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee. The amount to be paid under an Award of Performance Shares may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion.

(b)           Performance Units.  The Committee may grant Awards of Performance Units, designate the Participants to whom Performance Units are to be awarded and determine the number of Performance Units and the terms and conditions of each such Award. Performance Units shall consist of a unit valued by reference to a designated amount of property other than Shares, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including, without limitation, cash, Shares, other property, or any

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combination thereof, upon the attainment of performance goals, as established by the Committee, and other terms and conditions specified by the Committee.

10.2.       Terms of Performance Awards.  The Committee will determine, and each Award Agreement shall set forth, the terms of each Performance Award including, without limitation: (a) the number of Shares deemed subject to an award of Performance Shares; (b) the Performance Factors and Performance Period that shall determine the time and extent to which each award of Performance Shares shall be settled; (c) the consideration to be distributed on settlement; and (d) the effect of the Participant’s termination of Service on each Performance Award.  In establishing Performance Factors and the Performance Period the Committee will: (x) determine the nature, length and starting date of any Performance Period; (y) select from among the Performance Factors to be used; and (z) determine the number of Shares deemed subject to the award of Performance Shares.  Prior to settlement the Committee shall determine the extent to which Performance Awards have been earned.  Performance Periods may overlap and Participants may participate simultaneously with respect to Performance Awards that are subject to different Performance Periods and different performance goals and other criteria.

10.3.       Termination of Service.  Except as may be set forth in the Participant’s Award Agreement, vesting ceases on the date Participant’s Service terminates (unless determined otherwise by the Committee).

11.          PAYMENT FOR SHARE PURCHASES.  Payment from a Participant for Shares purchased pursuant to this Plan may be made in cash or by check or, where approved for the Participant by the Committee and where permitted by law (and to the extent not otherwise set forth in the applicable Award Agreement):

(a)           by cancellation of indebtedness of the Company to the Participant;

(b)           by surrender of Shares by the Participant that have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Award will be exercised or settled;

(c)           by waiver of compensation due or accrued to the Participant for services rendered or to be rendered to the Company or a Parent or Subsidiary;

(d)           by consideration received by the Company pursuant to a broker-assisted or other form of cashless exercise program implemented by the Company in connection with the Plan;

(e)           by any combination of the foregoing; or

(f)            by any other method of payment as is permitted by Applicable Law.

For avoidance of doubt, cash or check payment by a Participant for Shares may include (i) cash or check denominated in U.S. Dollars, (ii) to the extent permissible under Applicable Laws, cash or check denominated in Chinese Renminbi, or (iii) cash or check denominated in any other local currency as approved by the Committee.  In the event the exercise price for an Award is paid in Renminbi or other foreign currency, as permitted by the Committee, the amount

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payable will be determined by conversion from U.S. dollars at the official rate promulgated by the People’s Bank of China for Renminbi, or for any other foreign currency, the exchange rate as selected by the Committee on the date of exercise.

Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member of the Board or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to pay the exercise price in any method that would violate Section 13(k) of the Exchange Act.

12.          SHARES DISTRIBUTED.  Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares, treasury shares (subject to Applicable Laws) or Shares purchased on the open market.  Additionally, in the discretion of the Committee, ADS representing the corresponding number of Shares that otherwise would be distributed pursuant to an Award may be distributed in lieu of Shares in settlement of any Award.

13.          WITHHOLDING TAXES.

13.1.       Withholding Generally.  Whenever Shares are to be issued in satisfaction of Awards granted under this Plan or a tax event occurs, the Company may require the Participant to remit to the Company, or to the Parent, applicable Subsidiary or Related Entity or Affiliate employing the Participant, an amount sufficient to satisfy applicable U.S. federal, state, local and international withholding tax or social insurance requirements or any other tax liability legally due from the Participant prior to the delivery of Shares pursuant to exercise or settlement of any Award.  Whenever payments in satisfaction of Awards granted under this Plan are to be made in cash, such payment will be net of an amount sufficient to satisfy applicable U.S. federal, state, local and international withholding tax or social insurance requirements or any other tax liability legally due from the Participant.  The Fair Market Value of the Shares will be determined as of the date that the taxes are required to be withheld and such Shares shall be valued based on the value of the actual trade of Shares, the per-Share value of the actual trade of ADS, or, if neither of the foregoing are applicable, the Fair Market Value of the Shares as of the previous trading day.

13.2.       Share Withholding.  The Committee, or its delegate(s), as permitted by Applicable Law, in its sole discretion and pursuant to such procedures as it may specify from time to time and to limitations of local law, may require or permit a Participant to satisfy such tax withholding obligation or any other tax liability legally due from the Participant, in whole or in part by (without limitation) (a) paying cash, (b) electing to have the Company withhold otherwise deliverable cash, ADS, or Shares having a Fair Market Value equal to the minimum statutory amount required to be withheld, (c) delivering to the Company already-owned Shares or ADS having an aggregate Fair Market Value equal to the minimum amount required to be withheld or (d) withholding from the proceeds of the sale of otherwise deliverable Shares or ADS acquired pursuant to an Award either through a voluntary sale or through a mandatory sale arranged by the Company for the minimum amount required to be withheld.

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14.          TRANSFERABILITY.

14.1.       Transfer Generally.  Unless determined otherwise by the Committee or pursuant to Section 14.2, an Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution.  If the Committee makes an Award transferable, including, without limitation, by instrument to an inter vivos or testamentary trust in which the Awards are to be passed to beneficiaries upon the death of the trustor (settlor) or by gift or by domestic relations order to a Permitted Transferee, such Award will contain such additional terms and conditions as the Committee deems appropriate.  All Awards shall be exercisable: (a) during the Participant’s lifetime only by (i) the Participant, or (ii) the Participant’s guardian or legal representative; (b) after the Participant’s death, by the legal representative of the Participant’s heirs or legatees; and (c) in the case of all Awards except ISOs, by a Permitted Transferee.

14.2.       Award Transfer Program.  Notwithstanding any contrary provision of the Plan, the Committee shall have all discretion and authority to determine and implement the terms and conditions of any Award Transfer Program instituted pursuant to this Section 14.2 and shall have the authority to amend the terms of any Award participating in, or otherwise eligible to participate in, the Award Transfer Program, including (but not limited to) the authority to (a) amend (including to extend) the expiration date, post-termination exercise period and/or forfeiture conditions of any such Award, (b) amend or remove any provisions of the Award relating to the Award holder’s continued service to the Company or its Parent, Subsidiary, Related Entity or Affiliate, (c) amend the permissible payment methods with respect to the exercise or purchase of any such Award, (d) amend the adjustments to be implemented in the event of changes in the capitalization and other similar events with respect to such Award, and (e) make such other changes to the terms of such Award as the Committee deems necessary or appropriate in its sole discretion.

15.          PRIVILEGES OF SHARE OWNERSHIP; RESTRICTIONS ON SHARES.

15.1.       Voting and Dividends.  No Participant will have any of the rights of a shareholder with respect to any Shares until the Shares are issued to the Participant, except for any dividend equivalent rights permitted by an applicable Award Agreement (“Dividend Equivalent Rights”).  After Shares are issued to the Participant, the Participant will be a shareholder and have all the rights of a shareholder with respect to such Shares, including the right to vote and receive all dividends or other distributions made or paid with respect to such Shares; provided that if such Shares are Restricted Shares, then any new, additional or different securities the Participant may become entitled to receive with respect to such Shares by virtue of a share dividend, share split or any other change in the corporate or capital structure of the Company will be subject to the same restrictions as the Restricted Shares; provided, further, that the Participant will have no right to retain such share dividends or share distributions with respect to Shares that are repurchased pursuant to Section 15.2.  However, the Committee, in its discretion, may provide in the Award Agreement evidencing any Award that the Participant shall be entitled to Dividend Equivalent Rights with respect to the payment of cash dividends on Shares underlying an Award during the period beginning on the date the Award is granted and ending, with respect to each Share subject to the Award, on the earlier of the date on which the Award is exercised or settled or the date on which it is forfeited.  Such Dividend Equivalent Rights, if any, shall be credited to

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the Participant in the form of additional whole Shares as of the date of payment of such cash dividends on Shares.

15.2.       Restrictions on Shares.  At the discretion of the Committee, the Company may reserve to itself and/or its assignee(s) a right to repurchase any or all Unvested Shares (other than Unvested Shares that forfeit on termination of Service) held by a Participant following such Participant’s termination of Service at any time within ninety (90) days (or such longer or shorter time determined by the Committee) after the later of the date the Participant’s Service terminates and the date the Participant purchases Shares under this Plan, for cash and/or cancellation of purchase money indebtedness, at the Participant’s Purchase Price.

16.          CERTIFICATES.  All Shares or other securities whether or not certificated, delivered under this Plan will be subject to such share transfer orders, legends and other restrictions as the Committee may deem necessary or advisable, including restrictions under any applicable U.S. federal, state or other securities law, or any rules, regulations and other requirements of the SEC or any stock exchange or automated quotation system upon which the Shares may be listed or quoted and any non-U.S. exchange controls or securities law restrictions to which the Shares are subject.

17.          ESCROW; PLEDGE OF SHARES.  To enforce any restrictions on a Participant’s Shares, the Committee may require the Participant to deposit all certificates representing Shares, together with share powers or other instruments of transfer approved by the Committee, appropriately endorsed in blank, with the Company or an agent designated by the Company to hold in escrow until such restrictions have lapsed or terminated, and the Committee may cause a legend or legends referencing such restrictions to be placed on the certificates.  Any Participant who is permitted to execute a promissory note as partial or full consideration for the purchase of Shares under this Plan will be required to pledge and deposit with the Company all or part of the Shares so purchased as collateral to secure the payment of the Participant’s obligation to the Company under the promissory note; provided, however, that the Committee may require or accept other or additional forms of collateral to secure the payment of such obligation and, in any event, the Company will have full recourse against the Participant under the promissory note notwithstanding any pledge of the Participant’s Shares or other collateral.  In connection with any pledge of the Shares, the Participant will be required to execute and deliver a written pledge agreement in such form as the Committee will from time to time approve.  The Shares purchased with the promissory note may be released from the pledge on a pro rata basis as the promissory note is paid.

18.          REPRICING; EXCHANGE AND BUYOUT OF AWARDS.  Without prior shareholder approval, the Committee may (a) reprice Options or SARs (and where such repricing is a reduction in the Exercise Price of outstanding Options or SARs, the consent of the affected Participants is not required provided written notice is provided to them, notwithstanding any adverse tax consequences to them arising from the repricing), and (b) with the consent of the respective Participants (unless not required pursuant to Section 5.9 of the Plan), pay cash or issue new Awards in exchange for the surrender and cancellation of any, or all, outstanding Awards.

19.          SECURITIES LAW AND OTHER REGULATORY COMPLIANCE.  An Award will not be effective unless such Award is in compliance with all applicable U.S. federal and

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state securities and exchange control laws, all Applicable Laws of any other country or jurisdiction, rules and regulations of any governmental body, and the requirements of any stock exchange or automated quotation system upon which the Shares may then be listed or quoted, as they are in effect on the date of grant of the Award and also on the date of exercise or other issuance.  Notwithstanding any other provision in this Plan, the Company will have no obligation to issue or deliver certificates for Shares under this Plan prior to: (a) obtaining any approvals from governmental agencies that the Company determines are necessary or advisable; and/or (b) completion of any registration or other qualification of such Shares under any Applicable Law or ruling of any governmental body that the Company determines to be necessary or advisable.  The Company will be under no obligation to register the Shares with the SEC or to effect compliance with the registration, qualification or listing requirements of any applicable securities laws, exchange control laws, stock exchange or automated quotation system, and the Company will have no liability for any inability or failure to do so.

20.          NO OBLIGATION TO EMPLOY.  Nothing in this Plan or any Award granted under this Plan will confer or be deemed to confer on any Participant any right to continue in the employment of, or to continue any other relationship with, the Company or any Parent, Subsidiary, Related Entity or Affiliate or limit in any way the right of the Company or any Parent, Subsidiary, Related Entity or Affiliate to terminate Participant’s employment or other relationship at any time.

21.          CORPORATE TRANSACTIONS.

21.1.       Assumption or Replacement of Awards by Successor.  In the event that the Company is subject to a Corporate Transaction, outstanding Awards acquired under the Plan shall be subject to the agreement evidencing the Corporate Transaction, which need not treat all outstanding Awards in an identical manner.  Such agreement, without the Participant’s consent, shall provide for one or more of the following with respect to all outstanding Awards as of the effective date of such Corporate Transaction:

(a)           The continuation of an outstanding Award by the Company (if the Company is the successor entity).

(b)           The assumption of an outstanding Award by the successor or acquiring entity (if any) of such Corporate Transaction (or by its parents, if any), which assumption will be binding on all selected Participants; provided that the exercise price and the number and nature of shares issuable upon exercise of any such Option or Share Appreciation Right, or any Award that is subject to Section 409A of the Code by a Participant who is subject to Section 409A, will be adjusted appropriately pursuant to Section 424(a) of the Code.

(c)           The substitution by the successor or acquiring entity in such Corporate Transaction (or by its parents, if any) of equivalent awards with substantially the same terms for such outstanding Awards (except that the exercise price and the number and nature of shares issuable upon exercise of any such Option or Share Appreciation Right, or any Award that is subject to Section 409A of the Code by a Participant who is subject to Section 409A, will be adjusted appropriately pursuant to Section 424(a) of the Code).

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(d)The full or partial acceleration of exercisability or vesting and accelerated expiration of an outstanding Award and lapse of the Company’s right to repurchase or re-acquire shares acquired under an Award or lapse of forfeiture rights with respect to shares acquired under an Award.

(e)The settlement of the full value of such outstanding Award (whether or not then vested or exercisable) in cash, cash equivalents, or securities of the successor entity (or its parent, if any) with a Fair Market Value equal to the required amount, followed by the cancellation of such Awards; provided, however, that such Award may be cancelled if such Award has no value, as determined by the Committee, in its discretion. Subject to Section 409A of the Code, to the extent applicable, such payment may be made in installments and may be deferred until the date or dates the Award would have become exercisable or vested. Such payment may be subject to vesting based on the Participant’s continued service, provided that the vesting schedule shall not be less favorable to the Participant than the schedule under which the Award would have become vested or exercisable. For purposes of this Section 21.1(e), the Fair Market Value of any security shall be determined without regard to any vesting conditions that may apply to such security.

(f)The cancellation of outstanding Awards in exchange for no consideration.

The Board shall have full power and authority to assign the Company’s right to repurchase or re-acquire or forfeiture rights to such successor or acquiring corporation. In addition, in the event such successor or acquiring corporation refuses to assume, convert, replace or substitute Awards, as provided above, pursuant to a Corporate Transaction, the Committee will notify the Participant in writing or electronically that such Award will be exercisable for a period of time determined by the Committee in its sole discretion, and such Award will terminate upon the expiration of such period. Awards need not be treated similarly in a Corporate Transaction.

21.2.Assumption of Awards by the Company.  The Company, from time to time, also may substitute or assume outstanding awards granted by another company, whether in connection with an acquisition of such other company or otherwise, by either (a) granting an Award under this Plan in substitution of such other company’s award; or (b) assuming such Award as if it had been granted under this Plan if the terms of such assumed award could be applied to an Award granted under this Plan. Such substitution or assumption will be permissible if the holder of the substituted or assumed award would have been eligible to be granted an Award under this Plan if the other company had applied the rules of this Plan to such grant. In the event the Company assumes an award granted by another company, the terms and conditions of such award will remain unchanged (except that the Purchase Price or the Exercise Price, as the case may be, and the number and nature of Shares issuable upon exercise or settlement of any such award will be adjusted appropriately pursuant to Section 424(a) of the Code). In the event the Company elects to grant a new Option in substitution rather than assuming an existing Option, such new Option may be granted with a similarly adjusted Exercise Price. Substitute Awards shall not be credited toward the number of Shares authorized for grant under the Plan or authorized for grant to a Participant in a calendar year.

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22.ADOPTION AND SHAREHOLDER APPROVAL.  This Plan shall be submitted for the approval of the Company’s shareholders, consistent with Applicable Laws, within twelve (12) months before or after the date this Plan is adopted by the Board.

23.TERM OF PLAN/GOVERNING LAW.  Unless earlier terminated as provided herein, this Plan will become effective on the Effective Date and will terminate ten (10) years from the date this Plan is adopted by the Board. This Plan and all Awards granted hereunder shall be governed by and construed in accordance with the laws of the Cayman Islands (excluding its conflict of law rules).

24.AMENDMENT OR TERMINATION OF PLAN.  The Board may at any time terminate or amend this Plan in any respect, including, without limitation, amendment of any form of Award Agreement or instrument to be executed pursuant to this Plan; provided, however, that to the extent necessary to comply with Applicable Laws, the Board will not, without the approval of the shareholders of the Company, amend this Plan in any manner that requires such shareholder approval; provided, further, that a Participant’s Award shall be governed by the version of this Plan then in effect at the time such Award was granted.

25.NONEXCLUSIVITY OF THE PLAN.  Neither the adoption of this Plan by the Board, the submission of this Plan to the shareholders of the Company for approval, nor any provision of this Plan will be construed as creating any limitations on the power of the Board to adopt such additional compensation arrangements as it may deem desirable, including, without limitation, the granting of share Awards and bonuses otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases.

26.INSIDER TRADING POLICY.  Each Participant who receives an Award shall comply with any policy adopted by the Company from time to time covering transactions in the Company’s securities by Employees, officers and/or Directors of the Company.

27.DEFINITIONS.  As used in this Plan, and except as elsewhere defined herein, the following terms will have the following meanings:

27.1.“ADS” means an American depositary share representing Class B ordinary shares of the Company. The term shall refer to the singular or plural as appropriate in the context as used in this document.

27.2.“Affiliate” means any person or entity that directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, the Company, including any general partner, managing member, officer or Director of the Company, in each case as of the date on which, or at any time during the period for which, the determination of affiliation is being made. For purposes of this definition, the term “control” (including the correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any person or entity, means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of such person or entity, whether through the ownership of voting securities or by contract or otherwise.

27.3.“Applicable Laws” means the requirements relating to the administration of equity-based awards under U.S. state corporate laws, U.S. federal and state securities laws, the

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Code, any stock exchange or quotation system on which the Shares are listed or quoted, and the applicable laws of any other country or jurisdiction where Awards are, or will be, granted under the Plan.

27.4.“Award” means any award under the Plan, including any Option, Restricted Share Award, Share Bonus Award, Share Appreciation Right, Restricted Share Unit or Performance Award.

27.5.“Award Agreement” means, with respect to each Award, the written or electronic agreement between the Company and the Participant setting forth the terms and conditions of the Award, which shall be in substantially a form (which need not be the same for each Participant) that the Committee has from time to time approved, and will comply with and be subject to the terms and conditions of this Plan.

27.6.“Award Transfer Program” means any program instituted by the Committee which would permit Participants the opportunity to transfer any outstanding Awards to a financial institution or other person or entity approved by the Committee.

27.7.“Board” means the board of Directors of the Company.

27.8.“Cause” means (a) Participant’s willful failure substantially to perform his or her duties and responsibilities to the Company or deliberate violation of a Company policy; (b) Participant’s commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in material injury to the Company; (c) unauthorized use or disclosure by Participant of any proprietary information or trade secrets of the Company or any other party to whom the Participant owes an obligation of nondisclosure as a result of his or her relationship with the Company; or (d) Participant’s willful breach of any of his or her obligations under any written agreement or covenant with the Company. The determination as to whether a Participant is being terminated for Cause shall be made in good faith by the Company and shall be final and binding on the Participant. The foregoing definition does not in any way limit the Company’s ability to terminate a Participant’s employment or consulting relationship at any time as provided in Section 20 above, and the term “Company” will be interpreted to include any Parent, Subsidiary, Related Entity or Affiliate, as appropriate. Notwithstanding the foregoing, the foregoing definition of “Cause” may, in part or in whole, be modified or replaced in each individual employment agreement or Award Agreement with any Participant, provided that such document supersedes the definition provided in this Section 27.8.

27.9.“Code” means the United States Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.

27.10.“Committee” means the Compensation Committee of the Board or those persons to whom administration of the Plan, or part of the Plan, has been delegated as permitted by law.

27.11.“Company” means Gridsum Holding Inc., or any successor company.

27.12.“Consultant” means any person, including an advisor or independent contractor, engaged by the Company or a Parent, Subsidiary, Related Entity or Affiliate to render bona fide services to such entity, provided that such rendered services are not in connection with the offer

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or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company’s securities.

27.13.“Corporate Transaction” means the occurrence of any of the following events: (a) any “Person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total voting power represented by the Company’s then-outstanding voting securities; provided, however, that for purposes of this subclause (a), the acquisition of additional securities by any one Person who is considered to own more than fifty percent (50%) of the total voting power of the securities of the Company will not be considered a Corporate Transaction; provided, further, that the following acquisitions shall not constitute a Corporate Transaction:  (I) any acquisition by the Company or any Affiliate, (II) any acquisition by any employee benefit plan sponsored or maintained by the Company or any Affiliate, or (III) any acquisition pursuant to a merger or consolidation that would not otherwise constitute a Corporate Transaction by reason of the exception set forth in subclause (c) below; (b) the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; (c) the consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation; (d) any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code wherein the shareholders of the Company give up all of their equity interest in the Company (except for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the Company); or (e) a change in the effective control of the Company that occurs on the date that a majority of members of the Board is replaced during any twelve (12) month period by members of the Board whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election; provided, however, that for purpose of this subclause (e), if any Person is considered to be in effective control of the Company, the acquisition of additional control of the Company by the same Person will not be considered a Corporate Transaction. For purposes of this definition, Persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of shares, or similar business transaction with the Company. Notwithstanding the foregoing, to the extent that any amount constituting deferred compensation (as defined in Section 409A of the Code) would become payable under this Plan by reason of a Corporate Transaction, such amount shall become payable only if the event constituting a Corporate Transaction would also qualify as a change in ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company, each as defined within the meaning of Code Section 409A, as it has been and may be amended from time to time, and any proposed or final Treasury Regulations and IRS guidance that has been promulgated or may be promulgated thereunder from time to time.

27.14.“Director” means a member of the Board.

27.15.“Disability” means, unless otherwise required by the Applicable Law or expressly set forth in the applicable employment agreement, Award Agreement or other applicable contract with the Participant, (a) in the case of incentive stock options, total and permanent disability as defined in Section 22(e)(3) of the Code, or (b) in the case of other Awards, that the Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last

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for a continuous period of not less than 12 months. A Participant will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Committee in its discretion.

27.16.“Effective Date” means the  day immediately prior to the date of the underwritten initial public offering of the ADS representing Shares pursuant to a registration statement under Applicable Laws.

27.17.“Employee” means any person, including officers and Directors, employed by the Company or any Parent, Subsidiary, Related Entity or Affiliate. Neither service as a Director nor payment of a Director’s fee by the Company will be sufficient to constitute “employment” by the Company.

27.18.“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

27.19.“Exchange Program” means a program pursuant to which (a) outstanding Awards are surrendered, cancelled or exchanged for cash, the same type of Award or a different Award (or combination thereof), or (b) the exercise price of an outstanding Award is increased or reduced.

27.20.“Exercise Price” means, with respect to an Option, the price at which a holder may purchase the Shares issuable upon exercise of an Option and with respect to a SAR, the price at which the SAR is granted to the holder thereof.

27.21.“Fair Market Value” means, as of any date, the value of a Share or ADS, as follows:

(a)(i) If ADS representing Shares are listed on one or more established stock exchanges or traded on one or more automated quotation systems, the Fair Market Value of an ADS (or, as applicable, of a Share on a per-Share proportionate basis based on the value of the Fair Market Value of an ADS) shall be the closing sales price for such ADS as quoted on the principal exchange or system on the date of determination, as reported in Bloomberg or such other source as the Committee deems reliable, or (ii) if the date of determination is not a date  when ADS are publicly listed or traded on one or more established stock exchanges or an automated quotation system or otherwise quoted by a recognized securities dealer, the Fair Market Value shall be the closing sales price of an ADS (or, as applicable, of a Share on a per-Share proportionate basis based on the value of the Fair Market Value of an ADS), as quoted on the principal exchange or system on which the securities are listed or traded on the trading date immediately preceding the date of determination;

(b)in the case of an Option or SAR grant made on the Effective Date, the Fair Market Value of a Share will be the price per ADS (or, as applicable, of a Share on a per-Share proportionate basis based on the value of the Fair Market Value of an ADS) that is initially offered for sale to the public by the Company’s underwriters in the initial public offering of the Company’s securities pursuant to a registration statement filed with the SEC under the Securities Act; or

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(c)if none of the foregoing is applicable, by the Board or the Committee in good faith.

27.22.“IRS” means the United States Internal Revenue Service.

27.23.“Option” means an award of an option to purchase Shares pursuant to Section 5.

27.24.“Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if each of such corporations other than the Company owns shares possessing fifty percent (50%) or more of the total combined voting power of all classes of shares in one of the other corporations in such chain.

27.25.“Participant” means a person who holds an Award under this Plan.

27.26.“Performance Award” means an award granted pursuant to Section 10 of the Plan.

27.27.“Performance Factors” means any of the factors selected by the Committee and specified in an Award Agreement, from among the following objective measures, either individually, alternatively or in any combination, applied to the Company as a whole or any business unit or Subsidiary, either individually, alternatively, or in any combination, on a GAAP or non-GAAP basis, and measured, to the extent applicable on an absolute basis or relative to a pre-established target, to determine whether the performance goals established by the Committee with respect to applicable Awards have been satisfied.

(a)Backlog, Bookings, or Billings, or Book-to-Bill Ratio

(b)Sales, Revenue, Net Sales, or Net Revenue

(c)Profit Before Tax;

(d)Earnings (which may include earnings before interest, taxes, depreciation and/or amortization, or such measures adjusted for the impact of stock-based compensation expenses or other items removed from the Company’s net earnings or adjusted EBITDA or similar measures in its periodic announcements of financial results, and any per share equivalent of any such measure);

(e)Operating income;

(f)Operating profit or loss;

(g)Gross profit or gross margin;

(h)Any one or more operating expenses as a percentage of revenue or otherwise;

(i)Net income or loss;

(j)Earnings or loss per share;

(k)Total stockholder return;

(l)Market share;

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(m)Return on assets or return on net assets;

(n)Public trading price of the Company’s stock;

(o)Change in stockholder value relative to a pre-determined index;

(p)Return on equity or Return on invested capital;

(q)Cash Flow (including free cash flow or operating cash flows)

(r)Balance of cash, cash equivalents and marketable securities;

(s)Cash conversion cycle;

(t)Economic value added;

(u)Individual business objectives, which may be confidential;

(v)Contract awards;

(w)Expense reduction;

(x)Credit rating;

(y)Completion of specifically identified projects, joint venture or other corporate transaction;

(z)Development and implementation of a strategic plan, diversity plan or succession plan;

(aa)Employee satisfaction;

(bb)Employee retention;

(cc)Customer satisfaction;

(dd)New product invention or innovation;

(ee)Attainment of research and development milestones;

(ff)Improvements in productivity;

(gg)Achievement of working-capital targets and changes in working capital; and

(hh)Attainment of objective operating goals and employee metrics.

The Committee may, in recognition of unusual or non-recurring items such as acquisition-related activities or changes in applicable accounting rules, provide for one or more equitable adjustments (based on objective standards) to the Performance Factors to preserve the Committee’s original intent regarding the Performance Factors at the time of

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the initial award grant. It is within the sole discretion of the Committee to make or not make any such equitable adjustments.

27.28.“Performance Period” means one or more periods of time, which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Factors will be measured for the purpose of determining a Participant’s right to, and the payment of, a Performance Award.

27.29.“Performance Share” means an Award granted pursuant to Section 10 of the Plan, the payment of which is contingent upon achieving certain performance goals established by the Committee.

27.30.“Performance Unit” means a right granted to a Participant pursuant to Section 10 to receive a designated amount of property other than Shares, the payment of which is contingent upon achieving certain performance goals established by the Committee.

27.31.“Permitted Transferee” means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law (including adoptive relationships) of the Employee, any person sharing the Employee’s household (other than a tenant or employee), a trust in which these persons (or the Employee) have more than 50% of the beneficial interest, a foundation in which these persons (or the Employee) control the management of assets, and any other entity in which these persons (or the Employee) own more than 50% of the voting interests.

27.32.“Plan” means this Gridsum Holding Inc. 2016 Equity Incentive Plan.

27.33.“Purchase Price” means the price to be paid for Shares acquired under the Plan, other than Shares acquired upon exercise of an Option or SAR.

27.34.“Related Entity” means any person or entity (including any subsidiary thereof) in or of which the Company or a Subsidiary holds a substantial economic interest, or possesses the power to direct or cause the direction of the management policies, directly or indirectly, through the ownership of voting securities, by contract, or other arrangements as trustee, executor or otherwise, but which, for purposes of the Plan, is not a Subsidiary and which the Board designates as a Related Entity in a matter consistent with Applicable Law, including without limitation any Variable Interest Entity of the Company or any of its Subsidiaries.

27.35.“Restricted Share Award” means an award of Shares pursuant to Section 6 of the Plan, or issued pursuant to the early exercise of an Option.

27.36.“Restricted Share Unit” means an award granted pursuant to Section 9 of the Plan.

27.37.“SEC” means the United States Securities and Exchange Commission.

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

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27.39.“Service” shall mean service as an Employee, Consultant and Director, to the Company or a Parent, Subsidiary, Related Entity or Affiliate, subject to such further limitations as may be set forth in the Plan or the applicable Award Agreement. An Employee will not be deemed to have ceased to provide Service in the case of sick leave or any other leave of absence approved by the Company, if (a) such leave is for a period of not more than 90 days, or (b) reemployment upon the expiration of such leave is guaranteed by contract or statute, or (c) formal policy adopted from time to time by the Company’s Board and issued and promulgated to employees in writing provides otherwise. In the case of any Employee on an approved leave of absence or a reduction in hours worked (for illustrative purposes only, a change in schedule from that of full-time to part-time), the Committee may make such provisions respecting suspension of or modification to vesting of the Award while on leave from the employ of the Company or a Parent, Subsidiary, Related Entity or Affiliate or during such change in working hours as it may deem appropriate, except that in no event may an Award be exercised after the expiration of the term set forth in the applicable Award Agreement. An employee shall have terminated employment as of the date he or she ceases to provide Service (regardless of whether the termination is in breach of local employment laws or is later found to be invalid) and employment shall not be extended by any notice period or garden leave mandated by local law, provided however, that a change in status from an employee to a consultant or advisor shall not terminate the service provider’s Service, unless determined by the Committee, in its discretion. The Committee will have sole discretion to determine whether a Participant has ceased to provide Service and the effective date on which the Participant ceased to provide Service.

27.40.“Shares” means shares of Class B ordinary shares of the Company, par value US$0.001, and the shares of any successor entity.

27.41.“Share Appreciation Right” means an award granted pursuant to Section 8 of the Plan.

27.42.“Share Bonus Award” means an award granted pursuant to Section 7 of the Plan.

27.43.“Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

27.44.“Treasury Regulations” means regulations promulgated by the United States Treasury Department.

27.45.“Unvested Shares” means Shares that have not yet vested or are subject to a right of repurchase in favor of the Company (or any successor thereto).

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EX-10.3

Exhibit 10.3

FORM OF INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made as of          , by and between Gridsum Holding Inc., an exempted company duly incorporated and validly existing under the law of the Cayman Islands (the “Company”), and                     (the “Indemnitee”), a director/an executive officer of the Company.

WHEREAS, the Indemnitee has agreed to serve as a director/an executive officer of the Company and in such capacity will render valuable services to the Company; and

WHEREAS, in order to induce and encourage highly experienced and capable persons such as the Indemnitee to serve as directors/executive officers of the Company, the board of directors of the Company (the “Board of Directors”) has determined that this Agreement is not only reasonable and prudent, but necessary to promote and ensure the best interests of the Company and its shareholders;

NOW, THEREFORE, in consideration of the premises and mutual agreements hereinafter set forth, and other good and valuable consideration, including, without limitation, the service of the Indemnitee, the receipt of which hereby is acknowledged, and in order to induce the Indemnitee to serve as a director/an executive officer of the Company, the Company and the Indemnitee hereby agree as follows:

1.Definitions. As used in this Agreement:

(a) “Change in Control” shall mean a change in control of the Company of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar or successor schedule or form) promulgated under the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred (irrespective of the applicability of the initial clause of this definition) if (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Act, but excluding any trustee or other fiduciary holding securities pursuant to an employee benefit or welfare plan or employee share plan of the Company or any subsidiary of the Company, or any entity organized, appointed, established or holding securities of the Company with voting power for or pursuant to the terms of any such plan) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Act), directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the Company’s then outstanding securities without the prior approval of at least two-thirds of the Continuing Directors (as defined below) in office immediately prior to such person’s attaining such interest; (ii) the Company is a party to a merger, consolidation, scheme of arrangement, sale of assets or other reorganization, or a proxy contest, as a consequence of which Continuing Directors in office immediately prior to such transaction or event constitute less than a majority of the Board of Directors of the Company (or any successor entity) thereafter; or (iii) during any period of two (2) consecutive years, individuals who at the beginning of such period constituted the Board of Directors of the Company (including for this purpose any new director whose election or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of such period) (such directors being referred to herein as “Continuing Directors”) cease for any reason to constitute at least a majority of the Board of Directors of the Company.

(b) “Disinterested Director” with respect to any request by the Indemnitee for indemnification or advancement of expenses hereunder shall mean a director of the Company

who neither is nor was a party to the Proceeding (as defined below) in respect of which indemnification or advancement is being sought by the Indemnitee.

(c) The term “Expenses” shall mean, without limitation, expenses of Proceedings, including attorneys’ fees, disbursements and retainers, accounting and witness fees, expenses related to the preparation or service as a witness, travel and deposition costs, expenses of investigations, judicial or administrative proceedings and appeals, amounts paid in settlement of a Proceeding by or on behalf of the Indemnitee, costs of attachment or similar bonds, any expenses of attempting to establish or establishing a right to indemnification or advancement of expenses, under this Agreement, the Company’s Memorandum of Association and Articles of Association as currently in effect (the “Articles”), applicable law or otherwise, and reasonable compensation for time spent by the Indemnitee in connection with the investigation, defense or appeal of a Proceeding or action for indemnification for which the Indemnitee is not otherwise compensated by the Company or any third party. The term “Expenses” shall not include the amount of judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, which are actually levied against or sustained by the Indemnitee to the extent sustained after final adjudication.

(d) The term “Proceeding” shall mean any threatened, pending or completed action, suit, arbitration, alternate dispute resolution mechanism, or any other proceeding (including, without limitation, an appeal therefrom), formal or informal, whether brought in the name of the Company or otherwise, whether of a civil, criminal, administrative or investigative nature, and whether by, in or involving a court or an administrative, other governmental or private entity or body (including, without limitation, an investigation by the Company or its Board of Directors), by reason of (i) the fact that the Indemnitee is or was a director/an executive officer of the Company, or is or was serving at the request of the Company as an agent of another enterprise, whether or not the Indemnitee is serving in such capacity at the time any liability or expense is incurred for which indemnification or reimbursement is to be provided under this Agreement, (ii) any actual or alleged act or omission or neglect or breach of duty, including, without limitation, any actual or alleged error or misstatement or misleading statement, which the Indemnitee commits or suffers while acting in any such capacity, or (iii) the Indemnitee attempting to establish or establishing a right to indemnification or advancement of expenses pursuant to this Agreement, the Company’s Articles, applicable law or otherwise.

(e) The phrase “serving at the request of the Company as an agent of another enterprise” or any similar terminology shall mean, unless the context otherwise requires, serving at the request of the Company as a director/an executive officer, officer, employee or agent of another corporation, partnership, joint venture, limited liability company, trust, employee benefit or welfare plan or other enterprise, foreign or domestic. The phrase “serving at the request of the Company” shall include, without limitation, any service as a director/an executive officer of the Company which imposes duties on, or involves services by, such director/executive officer with respect to the Company or any of the Company’s subsidiaries, affiliates, employee benefit or welfare plans, such plan’s participants or beneficiaries or any other enterprise, foreign or domestic. In the event that the Indemnitee shall be a director/an executive officer, officer, employee or agent of another corporation, partnership, joint venture, limited liability company, trust, employee benefit or welfare plan or other enterprise, foreign or domestic, 50% or more of the ordinary shares, combined voting power or total equity interest of which is owned by the Company or any subsidiary or affiliate thereof, then it shall be presumed conclusively that the Indemnitee is so acting at the request of the Company.

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2.Services by the Indemnitee. [For a director] [The Indemnitee agrees to serve as a director of the Company under the terms of the Indemnitee’s agreement with the Company for so long as the Indemnitee is duly elected and qualified, appointed or until such time as the Indemnitee tenders a resignation in writing or is removed as a director; provided, however, that the Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or other obligation imposed by operation of law)]./[For an executive officer] [The Indemnitee agrees to serve as an executive officer of the Company under the terms of the Indemnitee’s agreement with the Company until such time as the Indemnitee’s employment is terminated for any reason.]

3.Proceeding Other Than a Proceeding By or In the Right of the Company. The Company shall indemnify the Indemnitee if the Indemnitee is a party to or threatened to be made a party to or is otherwise involved in any Proceeding (other than a Proceeding by or in the right of the Company), by reason of the fact that the Indemnitee is or was a director/an executive officer of the Company, or is or was serving at the request of the Company as an agent of another enterprise, against all Expenses, judgments, fines, interest or penalties, and excise taxes assessed with respect to any employee benefit or welfare plan, which are actually and reasonably incurred by the Indemnitee in connection with such a Proceeding, to the fullest extent permitted by applicable law; provided, however, that any settlement of a Proceeding must be approved in advance in writing by the Company (which approval shall not be unreasonably withheld).

4.Proceedings By or In the Right of the Company. The Company shall indemnify the Indemnitee if the Indemnitee is a party to or threatened to be made a party to or is otherwise involved in any Proceeding by or in the right of the Company to procure a judgment in its favor by reason of the fact that the Indemnitee is or was a director/an executive officer of the Company, or is or was serving at the request of the Company as an agent of another enterprise, against all Expenses, judgments, fines, interest or penalties, and excise taxes assessed with respect to any employee benefit or welfare plan, which are actually and reasonably incurred by the Indemnitee in connection with the defense or settlement of such a Proceeding, to the fullest extent permitted by applicable law.

5.Indemnification for Costs, Charges and Expenses of Witness or Successful Party. Notwithstanding any other provision of this Agreement (except as set forth in subparagraph 9(a) hereof), and without a requirement for determination as required by Paragraph 8 hereof, to the extent that the Indemnitee (a) has prepared to serve or has served as a witness in any Proceeding in any way relating to (i) the Company or any of the Company’s subsidiaries, affiliates, employee benefit or welfare plans or such plan’s participants or beneficiaries or (ii) anything done or not done by the Indemnitee as a director/an executive officer of the Company or in connection with serving at the request of the Company as an agent of another enterprise, or (b) has been successful in defense of any Proceeding or in defense of any claim, issue or matter therein, on the merits or otherwise, including the dismissal of a Proceeding without prejudice or the settlement of a Proceeding without an admission of liability, the Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by the Indemnitee in connection therewith to the fullest extent permitted by applicable law.

6.Partial Indemnification. If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of the Expenses, judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, which are actually and reasonably incurred by the Indemnitee in the investigation, defense, appeal or settlement of any Proceeding, but not, however, for the total

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amount of the Indemnitee’s Expenses, judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, then the Company shall nevertheless indemnify the Indemnitee for the portion of such Expenses, judgments, fines, interest penalties or excise taxes to which the Indemnitee is entitled.

7.Advancement of Expenses. The Expenses incurred by the Indemnitee in any Proceeding shall be paid promptly by the Company in advance of the final disposition of the Proceeding at the written request of the Indemnitee to the fullest extent permitted by applicable law; provided, however, that the Indemnitee shall set forth in such request reasonable evidence that such Expenses have been incurred by the Indemnitee in connection with such Proceeding, a statement that such Expenses do not relate to any matter described in subparagraph 9(a) of this Agreement, and an undertaking in writing to repay any advances if it is ultimately determined as provided in subparagraph 8(b) of this Agreement that the Indemnitee is not entitled to indemnification under this Agreement.

8.Indemnification Procedure; Determination of Right to Indemnification.

(a) Promptly after receipt by the Indemnitee of notice of the commencement of any Proceeding, the Indemnitee shall, if a claim for indemnification or advancement of Expenses in respect thereof is to be made against the Company under this Agreement, notify the Company of the commencement thereof in writing. The omission to so notify the Company will not relieve the Company from any liability which the Company may have to the Indemnitee under this Agreement unless the Company shall have lost significant substantive or procedural rights with respect to the defense of any Proceeding as a result of such omission to so notify.

(b) The Indemnitee shall be conclusively presumed to have met the relevant standards of conduct, if any, as defined by applicable law, for indemnification pursuant to this Agreement and shall be absolutely entitled to such indemnification, unless a determination by clear and convincing evidence is made that the Indemnitee has not met such standards by a court of competent jurisdiction.

(c) If a claim for indemnification or advancement of Expenses under this Agreement is not paid by the Company within thirty (30) days after receipt by the Company of written notice thereof, the rights provided by this Agreement shall be enforceable by the Indemnitee in any court of competent jurisdiction. Such judicial proceeding shall be made de novo. The burden of proving by clear and convincing evidence that indemnification or advances are not appropriate shall be on the Company. The termination of any Proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself (i) create a presumption that the Indemnitee did not act in good faith and in a manner which he reasonably believed to be in the best interests of the Company and/or its shareholders, and, with respect to any criminal Proceeding, that the Indemnitee had reasonable cause to believe that his conduct was unlawful or (ii) otherwise adversely affect the rights of the Indemnitee to indemnification or advancement of Expenses under this Agreement, except as may be provided herein. The Company further agrees to stipulate in any such judicial proceeding that the Company is bound by all the provisions of this Agreement and is precluded from making any assertion to the contrary.

(d) If a court of competent jurisdiction shall determine that the Indemnitee is entitled to any indemnification or advancement of Expenses hereunder, the Company shall pay all Expenses actually and reasonably incurred by the Indemnitee in connection with such adjudication (including, but not limited to, any appellate proceedings). The Indemnitee’s Expenses incurred in connection with any Proceeding concerning the Indemnitee’s right to

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indemnification or advancement of Expenses in whole or in part pursuant to this Agreement shall also be indemnified by the Company, regardless of the outcome of such a Proceeding, to the fullest extent permitted by applicable law and the Company’s Articles.

(e) With respect to any Proceeding for which indemnification or advancement of Expenses is requested, the Company will be entitled to participate therein at its own expense and, except as otherwise provided below, to the extent that it may wish, the Company may assume the defense thereof, with counsel reasonably satisfactory to the Indemnitee. After notice from the Company to the Indemnitee of its election to assume the defense of a Proceeding, the Company will not be liable to the Indemnitee under this Agreement for any Expenses subsequently incurred by the Indemnitee in connection with the defense thereof, other than as provided below. The Company shall not settle any Proceeding in any manner which would impose any penalty or limitation on the Indemnitee without the Indemnitee’s written consent. The Indemnitee shall have the right to employ his own counsel in any Proceeding, but the fees and expenses of such counsel incurred after notice from the Company of its assumption of the defense of the Proceeding shall be at the expense of the Indemnitee, unless (i) the employment of counsel by the Indemnitee has been authorized by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of the defense of a Proceeding, or (iii) the Company shall not in fact have employed counsel to assume the defense of a proceeding, in each of which cases the fees and expenses of the Indemnitee’s counsel shall be advanced by the Company. The Company shall not be entitled to assume the defense of any Proceeding brought by or on behalf of the Company or as to which the Indemnitee has reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee.

9.Limitations on Indemnification.

No payments pursuant to this Agreement shall be made by the Company:

(a) To indemnify or advance funds to the Indemnitee for Expenses with respect to (i) Proceedings initiated or brought voluntarily by the Indemnitee and not by way of defense, except with respect to Proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise as required under applicable law or (ii) Expenses incurred by the Indemnitee in connection with preparing to voluntarily serve or serving, prior to a Change in Control, as a witness in cooperation with any party or entity who or which has threatened or commenced any action or proceeding against the Company, or any director, officer, employee, trustee, agent, representative, subsidiary, parent corporation or affiliate of the Company, but such indemnification or advancement of Expenses in each such case may be provided by the Company if the Board of Directors finds it to be appropriate;

(b) To indemnify the Indemnitee for any Expenses, judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, and sustained in any Proceeding for which payment is actually made to the Indemnitee under a valid and collectible insurance policy, except in respect of any excess beyond the amount of payment under such insurance;

(c) To indemnify the Indemnitee for any Expenses, judgments, fines, expenses or penalties sustained in any Proceeding for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Act or similar provisions of any foreign or United States federal, state or local statute or regulation;

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(d) To indemnify the Indemnitee for any Expenses, judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, for which the Indemnitee is indemnified by the Company otherwise than pursuant to this Agreement;

(e) To indemnify the Indemnitee for any Expenses (including without limitation any Expenses relating to a Proceeding attempting to enforce this Agreement), judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, on account of the Indemnitee’s conduct if such conduct shall be finally adjudged by a court of competent jurisdiction to have been knowingly fraudulent, deliberately dishonest or willful misconduct, including, without limitation, breach of the duty of loyalty; or

(f) If a court of competent jurisdiction finally determines that any indemnification hereunder is unlawful.

10.Continuation of Indemnification. All agreements and obligations of the Company contained herein shall continue during the period that the Indemnitee is a director/an executive officer of the Company (or is or was serving at the request of the Company as an agent of another enterprise, foreign or domestic) and shall continue thereafter so long as the Indemnitee shall be subject to any possible Proceeding by reason of the fact that the Indemnitee was a director/an executive officer of the Company or serving in any other capacity referred to in this Paragraph 10.

11.Indemnification Hereunder Not Exclusive. The indemnification provided by this Agreement shall not be deemed to be exclusive of any other rights to which the Indemnitee may be entitled under the Company’s Articles, any agreement, vote of shareholders or vote of Disinterested Directors, provisions of applicable law, or otherwise, both as to action or omission in the Indemnitee’s official capacity and as to action or omission in another capacity on behalf of the Company while holding such office.

12.Successors and Assigns.

(a) This Agreement shall be binding upon, and shall inure to the benefit of, the Indemnitee and the Indemnitee’s heirs, executors, administrators and assigns, whether or not the Indemnitee has ceased to be a director/an executive officer, and the Company and its successors and assigns. Upon the sale of all or substantially all of the business, assets or share capital of the Company to, or upon the merger of the Company into or with, any corporation, partnership, joint venture, trust or other person, this Agreement shall inure to the benefit of and be binding upon both the Indemnitee and such purchaser or successor person. Subject to the foregoing, this Agreement may not be assigned by either party without the prior written consent of the other party hereto.

(b) If the Indemnitee is deceased and is entitled to indemnification under any provision of this Agreement, the Company shall indemnify the Indemnitee’s estate and the Indemnitee’s spouse, heirs, executors, administrators and assigns against, and the Company shall, and does hereby agree to assume, any and all Expenses actually and reasonably incurred by or for the Indemnitee or the Indemnitee’s estate, in connection with the investigation, defense, appeal or settlement of any Proceeding. Further, when requested in writing by the spouse of the Indemnitee, and/or the Indemnitee’s heirs, executors, administrators and assigns, the Company shall provide appropriate evidence of the Company’s agreement set out herein to indemnify the Indemnitee against and to itself assume such Expenses.

13.Subrogation. In the event of payment under this Agreement, the Company

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shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

14.Severability. Each and every paragraph, sentence, term and provision of this Agreement is separate and distinct so that if any paragraph, sentence, term or provision thereof shall be held to be invalid, unlawful or unenforceable for any reason, such invalidity, unlawfulness or unenforceability shall not affect the validity, unlawfulness or enforceability of any other paragraph, sentence, term or provision hereof. To the extent required, any paragraph, sentence, term or provision of this Agreement may be modified by a court of competent jurisdiction to preserve its validity and to provide the Indemnitee with the broadest possible indemnification permitted under applicable law. The Company’s inability, pursuant to a court order or decision, to perform its obligations under this Agreement shall not constitute a breach of this Agreement.

15.Savings Clause. If this Agreement or any paragraph, sentence, term or provision hereof is invalidated on any ground by any court of competent jurisdiction, the Company shall nevertheless indemnify the Indemnitee as to any Expenses, judgments, fines, interest or penalties, or excise taxes assessed with respect to any employee benefit or welfare plan, which are incurred with respect to any Proceeding to the fullest extent permitted by any (a) applicable paragraph, sentence, term or provision of this Agreement that has not been invalidated or (b) applicable law.

16.Interpretation; Governing Law.  This Agreement shall be construed as a whole and in accordance with its fair meaning and any ambiguities shall not be construed for or against either party. Headings are for convenience only and shall not be used in construing meaning. This Agreement shall be governed and interpreted in accordance with the laws of Hong Kong without regard to the conflict of laws principles thereof.

17.Amendments.  No amendment, waiver, modification, termination or cancellation of this Agreement shall be effective unless in writing signed by the party against whom enforcement is sought. The indemnification rights afforded to the Indemnitee hereby are contract rights and may not be diminished, eliminated or otherwise affected by amendments to the Company’s Articles, or by other agreements, including directors’ and officers’ liability insurance policies, of the Company.

18.Counterparts.  This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each party and delivered to the other.

19.Notices. Any notice required to be given under this Agreement shall be directed to the Company at attention: Room A, Floor 8, Jadepalace Hotel, 76 Zhichun Road, Haidian District, Beijing, 100086, China and to the Indemnitee at            , or to such other address as either shall designate to the other in writing.

[The remainder of this page is intentionally left blank.]

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

INDEMNITEE

Name:

Gridsum Holding Inc.

By:

Name:

Title:

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EX-10.4

Exhibit 10.4

FORM OF EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of         , 20     by and between Gridsum Holding Inc., an exempted company incorporated and existing under the laws of the Cayman Islands (the “Company”) and              , an individual (the “Executive”). The term “Company” as used herein with respect to all obligations of the Executive hereunder shall be deemed to include the Company and all of its direct or indirect subsidiaries and consolidated affiliated entities (collectively, the “Group”, and each, a “Group Company”).

W I T N E S S E T H

WHEREAS, the Company desires to employ the Executive and to assure itself of the services of the Executive during the term of the Employment (as defined below); and

WHEREAS, the Executive desires to be employed by the Company during the term of the Employment and under the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.Position.  The Executive hereby accepts a position of                   of the Company (the “Employment”).

2.Term.  Subject to the terms and conditions of this Agreement, the initial term of the Employment shall be commencing on              , 20   (the “Effective Date”) until            , 20   , unless terminated earlier pursuant to the terms of this Agreement.  The Company and the Executive may determine to extend the Employment through mutual agreement.

3.Probation.  There is no probation period for the Employment.

4.Duties and Responsibilities.

(a)The Executive’s duties at the Company will include all jobs assigned by the Board of Directors of the Company (the “Board”) or, if authorized by the Board, by the Company’s Chief Executive Officer.

(b)The Executive shall (i) use his/her best efforts to perform his/her duties hereunder, (ii) devote all of his/her working time, attention and skills to the performance of his/her duties at the Company, and (iii) faithfully and diligently serve the Company in accordance with this Agreement and the guidelines, policies and procedures of the Company approved from time to time by the Board.

5.No Breach of Contract.  The Executive hereby represents to the Company that (i) the execution and delivery of this Agreement by the Executive and the performance by the Executive of his/her duties hereunder will not result in a breach of, or otherwise contravene, the terms of any other agreement or policy to which the Executive is a party or otherwise bound, except for agreements that are required to be entered into by and between the Executive and any Group Company pursuant to applicable laws of

the jurisdiction where the Executive is based, if any; (ii) that the Executive does not possess any information (including, without limitation, confidential information and trade secrets) relating to any other person or entity which would prevent the Executive from entering into this Agreement or carrying out his/her duties hereunder; and (iii) that the Executive is not bound by any confidentiality, trade secret or similar agreement with any other person or entity other than other Group Companies.

6.Location.  The Executive will be based in               , China or any other location as requested by the Company during the term of the Employment.

7.Compensation and Benefits.

(a)Cash Compensation.  As compensation for the performance by the Executive of his/her obligations hereunder, during the term of the Employment, the Company shall pay (or cause its designated affiliate to pay) the Executive cash compensation (inclusive of the statutory benefit contributions that the Company is required to set aside for the Executive under applicable law) pursuant to Schedule A hereto, subject to annual review and adjustment by the Board or any committee designated by the Board.

(b)Equity Incentives.  The Executive is eligible for participation in the Company’s share incentive plan(s) adopted by the Board pursuant to the terms and conditions thereof, and any award granted thereunder will be governed by an award agreement to be entered into separately between the Company and the Executive.

(c)Benefits.  The Executive is eligible for participation in any standard employee benefit plan or arrangement made available by the Company to its similarly situated executives, including without limitation any retirement plan, medical insurance plan and travel/holiday policy, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements.

8.Termination of Employment.  The Employment may be terminated during its term:

(a)by the Company, for cause, at any time without advance notice or remuneration, if (i) the Executive is convicted or pleads guilty to a criminal offense or to an act of fraud, misappropriation or embezzlement, (ii) the Executive has been negligent or acted dishonestly to the detriment of the Company, (iii) the Executive has engaged in actions amounting to material misconduct or failed to perform his/her material duties hereunder to the detriment of the Company, or (iv) the Executive has breached this Agreement in any material respect;

(b)by the Company, without cause, at any time, upon three-month prior written notice to the Executive; provided that upon termination without cause, the Company shall provide severance payments to the Executive as expressly required by applicable law of the jurisdiction where the Executive is based;

(c)by the Executive, at any time, with a 30-day prior written notice to the Company; or

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(d)automatically, following the Executive’s termination of employment on account of death or Incapacity.  For the purpose of this paragraph, “Incapacity” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of the Employment, which continues for at least 120 consecutive calendar days or 150 calendar days during any 12-month period, unless a longer period is required by applicable law, in which case that longer period would apply.

Subject to any notice requirement set forth above, any termination of the Employment shall be communicated by written notice of termination from the terminating party to the other party.

9.Certain Information.

(a)Confidentiality and Non-disclosure.  The Executive agrees at all times during and after the term of this Agreement, to hold in strict confidence, and not to use, or to disclose to any person, corporation or other entity without prior written consent of the Company, any Confidential Information, except as necessary for the performance of the Executive’s duties in connection with the Employment or required under applicable law.  The Executive understands that “Confidential Information” means any proprietary or confidential information of the Group Companies or their respective clients, customers or partners, including, without limitation, technical data, trade secrets, research and development information, product plans, services, customer lists and customers, supplier lists and suppliers, software developments, inventions, processes, formulae, technology, designs, hardware configuration information, personnel information, marketing, finances, information about the suppliers, joint ventures, franchisees, distributors and other persons with whom the any Group Company does business, information regarding the skills and compensation of other employees of the Group Companies or other business information disclosed to the Executive by or obtained by the Executive from the Group Companies or their respective clients, customers or partners either directly or indirectly in writing, orally or otherwise, if specifically indicated to be confidential or reasonably expected to be confidential.  Notwithstanding the foregoing, Confidential Information shall not include information that has become generally available to the public other than as a result of any breach by the Executive of confidential obligations under this Agreement.

(b)Company Property.  The Executive understands that all documents (including computer records, facsimile and e-mail) and materials created, received or transmitted in connection with the Employment or using the equipment or facilities of the Company are property of the Company and subject to inspection by the Company at any time.  Upon termination of the Employment (or at any other time when requested by the Company), the Executive will promptly deliver to the Company all aforementioned documents and materials and will provide written certification of his/her compliance with this Section 9.  Under no circumstances may the Executive continue to possess, following termination of the Employment, any aforementioned documents or materials of the Company, or any documents or materials or copies thereof containing any Confidential Information.

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(c)Former Employer Information.  The Executive represents and agrees that, during the term of his/her employment with the Group, he/she has not improperly used or disclosed, and will not improperly use or disclose, any proprietary information or trade secrets of any former employer or other person or entity with which the Executive has an agreement to keep in confidence information acquired by the Executive, if any.  The Executive will indemnify the Group and hold it harmless from and against all claims, liabilities, damages and expenses, including reasonable attorneys’ fees and costs of legal proceedings, arising out of or in connection with any violation of the foregoing.

(d)Third Party Information.  The Executive recognizes that each Group Company may have received, and in the future may receive, from third parties their confidential or proprietary information subject to a duty on such Group Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes.  The Executive agrees that the Executive owes such Group Company and such third parties, during the term of the Employment and thereafter, a duty to hold all such confidential or proprietary information in strict confidence and not to disclose it to any person or entity, and to use it in a manner consistent with, and for the limited purposes permitted by, such Group Company’s agreement with such third party.

10.Inventions.

(a)Inventions Retained and Licensed.  The Executive has attached hereto, as Schedule B, a list describing all inventions, ideas, improvements, designs and discoveries, whether or not patentable and whether or not reduced to practice, original works of authorship and trade secrets made or conceived by or belonging to the Executive (whether made solely by the Executive or jointly with others) that (i) were developed by the Executive prior to the Executive’s employment by the Group, (ii) relate to the Group’s actual or proposed business, products or research and development, and (iii) are not assigned to the Company hereunder (collectively, “Prior Inventions”); or, if no such list is attached, the Executive represents that there are no such Prior Inventions.  Except to the extent set forth in Schedule B, the Executive hereby acknowledges that, if in the course of his/her service for the Group, the Executive incorporates into a Group product, process or machine a Prior Invention owned by the Executive or in which he/she has an interest, the Group Companies are hereby granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide right and license (which may be freely transferred by the Group Companies to any other person or entity) to make, have made, modify, use, sell, sublicense and otherwise distribute such Prior Invention as part of or in connection with such product, process or machine.

(b)Disclosure and Assignment of Inventions.  The Executive understands that the Company engages in research and development and other activities in connection with its business and that, as an essential part of the Employment, the Executive is expected to make new contributions to and create inventions of value for the Company.  From and after the Effective Date, the Executive shall disclose in confidence to the Company all inventions, improvements, designs, original works of authorship, formulae, processes, compositions of

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matter, computer software programs, databases, mask works and trade secrets (collectively, the “Inventions”), which the Executive may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of the Employment.  The Executive acknowledges that copyrightable works prepared by the Executive within the scope of and during the period of the Employment with the Company are “works for hire” and that the Company will be considered the author thereof.  The Executive agrees that all the Inventions shall be the sole and exclusive property of the Company and the Executive hereby assigns all his/her right, title and interest in and to any and all of the Inventions to the Company without further consideration.

(c)Patent and Copyright Registration.  The Executive agrees to assist the Company in every proper way to obtain for the Company (of any of its designated affiliates) and enforce patents, copyrights, mask work rights, trade secret rights, and other legal protection for the Inventions.  The Executive will execute any documents that the Company may reasonably request for use in obtaining or enforcing such patents, copyrights, mask work rights, trade secrets and other legal protections.  The Executive’s obligations under this paragraph will survive the termination of the Employment; provided that the Company will reasonably compensate the Executive after such termination for time or expenses actually spent or incurred by the Executive at the Company’s request on such assistance.

11.Non-Competition.  In consideration of the compensation provided to the Executive by the Company hereunder, the adequacy of which is hereby acknowledged by the parties hereto, the Executive agrees that during the term of the Employment and for a period of         year(s) thereafter, the Executive shall not engage in Competition without the prior written consent of the Company.  For purposes of this Agreement, “Competition” shall mean the Executive’s engaging in, or otherwise directly or indirectly being employed by or acting as a consultant or lender to, or being a director, officer, employee, principal, agent, stockholder, member, owner or partner of, or permitting the Executive’s name to be used in connection with the activities of, any other business or organization which competes, directly or indirectly, with the Group in the business carried on by the Group; provided, however, that the Executive shall not be deemed to engage in Competition solely as a result of his/her holding of up to five percent (5%) of any class of the capital stock of an entity engaging in Competition that is listed on any recognized securities exchange anywhere.

12.Non-Solicitation.  During the term of the Employment and for a period of         year(s) thereafter, the Executive agrees that he/she will not, directly or indirectly, for his/her own benefit or for the benefit of any other person or entity, do any of the following without prior written consent of the Company:

(a)approach the suppliers, clients, customers or contacts or other persons or entities introduced to the Executive in his/her capacity as a representative of the Group for the purpose of doing business with such persons or entities that will harm the business relationships of the Group with these persons or entities; or

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(b)seek to solicit the services of any employee of the Group while such employee is being employed by any Group Company, or seek the termination by any such employee of his/her employment with any Group Company.

13.Survival; Specific Performance.  This section and Sections 9, 10, 11, 12, 18 and 21 shall survive the termination of the Employment for any reason.  In the event the Executive breaches Section 9, 10, 11 or 12, the Executive acknowledges and agrees that there will be no adequate remedy at law, and the Company shall be entitled to injunctive relief, a decree for specific performance and such other relief as may be proper (including monetary damages if appropriate).  In any event, the Company shall have right to seek all remedies permissible under applicable law.

14.Withholding Taxes.  Notwithstanding anything herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such national, provincial, local or any other income, employment or other taxes as may be required to be withheld pursuant to any applicable law.

15.Assignment.  This Agreement is personal in its nature and neither of the parties hereto may, without the prior written consent of the other party, assign or transfer this Agreement or any rights or obligations hereunder; provided, however, that (i) the Company may assign or transfer this Agreement or any rights or obligations hereunder to any other Group Company, and (ii) in the event of a merger or consolidation of the Company with, or transfer or sale of all or substantially all of its assets to, any other person or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of the successor of the Company and such successor shall discharge and perform all promises, covenants, duties, and obligations of the Company hereunder.

16.Severability.  The terms and provisions of this Agreement are intended to be severable.  If any term or provision hereof is illegal or invalid for any reason whatsoever, such term or provision will be enforced to the maximum extent permitted by law and, in any event, such illegality or invalidity shall not affect the validity of the remainder of this Agreement.

17.Entire Agreement.  This Agreement constitutes the entire agreement and understanding between the Executive and the Company regarding the terms of the Employment and supersedes all prior oral or written agreements concerning such subject matter.  The Executive acknowledges that he/she has not entered into this Agreement in reliance upon any representation, warranty or undertaking which is not set forth in this Agreement.

18.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the Cayman Islands.

19.Amendment.  This Agreement may not be amended, modified or changed (in whole or in part) unless mutually agreed in writing by the parties hereto.

20.Waiver.  Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege

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preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.

21.Notices.  All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and made if (i) delivered by hand, (ii) otherwise delivered against receipt therefor, or (iii) sent by a recognized courier with next-day or second-day delivery to the last known address of the other party.

22.Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.  This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties hereto.  Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.

23.Advice of Counsel.  Each party to this Agreement acknowledges that, in executing this Agreement, such party has had the opportunity to seek the advice of independent legal counsel, and has read and understood all of the terms and provisions of this Agreement.  This agreement shall not be construed against any party by reason of the drafting or preparation hereof.

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

The Company

Gridsum Holding Inc.

By:

Name:

Title:

The Executive

Name:

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SCHEDULE A

SCHEDULE B

EX-10.5

Exhibit 10.5

EXCLUSIVE BUSINESS COOPERATION AGREEMENT

This Exclusive Business Cooperation Agreement (the “Agreement”) is entered into in the People’s Republic of China (“PRC”) as of December 22, 2014 by and between the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”), and

(b)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)WFOE is a wholly-foreign-owned enterprise established in PRC, and has the necessary resources to provide technical and consulting services.

(b)Gridsum Holdco is a company with exclusively domestic capital registered in PRC and may engage in the business such as providing services with respect to search engine optimization, search engine marketing and web dissector as approved by the relevant governmental authorities in PRC (collectively, the “Principal Business”).

(c)WFOE is willing to provide Gridsum Holdco with technical support, consulting services and other commercial services on exclusive basis in relation to the Principal Business during the term of this Agreement, utilizing its advantages in technology, human resources, and information, and Gridsum Holdco is willing to accept such services provided by WFOE or WFOE’s designee(s), each on the terms set forth herein.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Services Provision

1.1Gridsum Holdco hereby appoints WFOE as Gridsum Holdco’s exclusive services provider to provide Gridsum Holdco with complete technical support, business support and related consulting services during the term of this Agreement, in accordance with the terms and conditions of this Agreement, which may include all necessary services within the scope of the Principal Business as may be determined from time to time by WFOE, such as but not limited to (A) the research and design of computer hardware and software, internet technology, communication technology and the related products; (B) technology transfer, technology service and consulting service for the foregoing products; and (C) training for computer technology. The exclusive services to be

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provided by WFOE shall not include any services beyond the business scope of WFOE. WFOE has no obligation to provide any services beyond the business scope of WFOE.

1.2Gridsum Holdco agrees to accept all the consultations and services provided by WFOE. Gridsum Holdco further agrees that unless with WFOE’s prior written consent, during the term of this Agreement, Gridsum Holdco shall not directly or indirectly accept the same or any similar consultations and/or services provided by any third party and shall not establish similar corporation relationship with any third party regarding the matters contemplated by this Agreement. Parties agree that WFOE may appoint other parties, who may enter into certain agreements described in Article 1.3 with Gridsum Holdco, to provide Gridsum Holdco with the consultations and/or services under this Agreement.

1.3Service Providing Methodology

(a)The Parties agree that during the term of this Agreement, where necessary, Gridsum Holdco may enter into further technical service agreements or consulting service agreements with WFOE or any other party designated by WFOE, which shall provide the specific contents, manner, personnel, and fees for the specific technical services and consulting services.

(b)To fulfill this Agreement, the Parties agree that WFOE can provide relevant equipments to Gridsum Holdco for Gridsum Holdco’s use for the purposes of providing services to Gridsum Holdco.

Article 2 Service Fees and Payment Mode

The Parties agree that, in consideration of the services provided by WFOE, Gridsum Holdco shall pay WFOE fees (the “Service Fees”) equal to 90% of the net income of Gridsum Holdco, which equals the balance of the gross income less the costs of Gridsum Holdco acceptable to the Parties (the “Net Income”). The Service Fees shall be due and payable on a quarterly basis. Within 30 days after the end of each quarter, Gridsum Holdco shall (i) deliver to WFOE the management accounts and operating statistics of Gridsum Holdco for such quarter, including the Net Iincome of Gridsum Holdco during such quarter (the “Quarterly Net Income”), and (ii) pay 90% of such Quarterly Net Income to WFOE (the “Quarterly Payment”). Within ninety (90) days after the end of each fiscal year, Gridsum Holdco shall (i) deliver to WFOE audited financial statements of Gridsum Holdco for such fiscal year, which shall be audited and certified by an independent certified public accountant approved by WFOE, and (ii) pay an amount to WFOE equal to the shortfall, if any, of the aggregate net income of Gridsum Holdco for such fiscal year, as shown in such audited financial statements, as compared to the aggregate amount of the Quarterly Payments paid by Gridsum Holdco to WFOE in such fiscal year. WFOE and Gridsum Holdco further agree that, according to the actual cooperation between WFOE and Gridsum Holdco and the revenue and expenditure situation of Gridsum Holdco, the Parties can reasonably adjust the calculation ratio of the Service Fees provided herein, and WFOE is entitled to determine, at its sole discretion, whether to permit Gridsum Holdco to defer the

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payment of part of Service Fees under certain particular circumstances.

Article 3 Intellectual Property Rights and Confidentiality Clauses

3.1WFOE shall have exclusive and proprietary rights and interests in all rights, ownership, interests and intellectual properties which owned by WFOE and used by WFOE during the performance of this Agreement, including but not limited to copyrights, patents, patent applications, software, technical secrets, trade secrets and others.

3.2The Parties acknowledge that the existence and the terms of this Agreement and any oral or written information exchanged between the Parties in connection with the preparation and performance this Agreement are regarded as confidential information. Each Party shall maintain confidentiality of all such confidential information, and without obtaining the written consent of the other Party, it shall not disclose any relevant confidential information to any third parties, except for the information that: (i) is in the public domain (other than through the receiving Party’s unauthorized disclosure); (ii) is under the obligation to be disclosed pursuant to the applicable laws or regulations, rules of any stock exchange, or orders of the court or other government authorities; or (iii) is required to be disclosed by any Party to its shareholders, investors, legal counsels or financial advisors regarding the transaction contemplated hereunder, provided that such shareholders, investors, legal counsels or financial advisors shall be bound by the confidentiality obligations similar to those set forth in this Article. Disclosure of any confidential information by the staff members or agencies hired by any Party shall be deemed disclosure of such confidential information by such Party, which Party shall be held liable for breach of this Agreement. This Article shall survive the termination of this Agreement for any reason.

3.3The Parties agree that this Article shall survive changes to, and rescission or termination of, this Agreement.

Article 4 Representations and Warranties

4.1WFOE hereby represents and warrants as follows:

(a)WFOE is a wholly owned foreign enterprise legally registered and validly existing in accordance with PRC laws.

(b)WFOE has taken all necessary corporate actions, obtained all necessary authorization and the consent and approval from third parties and government agencies (if any) for the execution, delivery and performance of this Agreement. WFOE’s execution, delivery and performance of this Agreement do not violate any explicit requirements under any law or regulation binding on WFOE.

(c)This Agreement constitutes WFOE’s legal, valid and binding obligations, enforceable in accordance with its terms.

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4.2Gridsum Holdco hereby represents and warrants as follows:

(a)Gridsum Holdco is a company legally registered and validly existing in accordance with PRC laws and has obtained the relevant permit and license for engaging in the Principal Business in a timely manner;

(b)Gridsum Holdco has taken all necessary corporate actions, obtained all necessary authorization and the consent and approval from third parties and government agencies (if any) for the execution, delivery and performance of this Agreement. Gridsum Holdco’s execution, delivery and performance of this Agreement do not violate any explicit requirements under any law or regulation binding on WFOE.

(c)This Agreement constitutes Gridsum Holdco’s legal, valid and binding obligations, and shall be enforceable against it.

Article 5 Term of Agreement

5.1This Agreement is executed on the date first above written and shall take effect as of such date. Unless earlier terminated in accordance with the provisions of this Agreement or relevant agreements separately executed between the Parties, the term of this Agreement shall be ten (10) years. After the execution of this Agreement, the Parties shall review this Agreement every three (3) months to determine whether to amend or supplement the provisions in this Agreement based on the actual circumstances at that time.

5.2The term of this Agreement may be extended if confirmed in writing by WFOE prior to the expiration thereof. The extended term shall be determined by WFOE, and Gridsum Holdco shall accept such extended term unconditionally.

Article 6 Termination

6.1Unless renewed in accordance with the relevant terms of this Agreement, this Agreement shall be terminated upon the date of expiration hereof.

6.2During the term of this Agreement, unless WFOE commits gross negligence, or a fraudulent act, against Gridsum Holdco, Gridsum Holdco shall not terminate this Agreement prior to its expiration date. Nevertheless, WFOE shall have the right to terminate this Agreement upon giving 30 days’ prior written notice to Gridsum Holdco at any time.

6.3The rights and obligations of the Parties under Articles 3, 7 and 8 shall survive the termination of this Agreement.

Article 7 Indemnification

Gridsum Holdco shall indemnify and hold harmless WFOE from any losses, injuries, obligations or expenses caused by any lawsuit, claims or other arbitration against WFOE arising from or caused by the consultations and services provided by WFOE to

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Gridsum Holdco pursuant this Agreement, except where such losses, injuries, obligations or expenses arise from the gross negligence or willful misconduct of WFOE.

Article 8 Notices

8.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

8.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

Article 9 Assignment

9.1Without WFOE’s prior written consent, Gridsum Holdco shall not assign its rights and obligations under this Agreement to any third party.

9.2Gridsum Holdco agrees that WFOE may assign its obligations and rights under this Agreement to any third party upon a prior written notice to Gridsum Holdco but without the consent of Gridsum Holdco.

Article 10 Miscellaneous

10.1This Agreement is written in both Chinese and English language in two (2) copies, each Party having one (1) copy with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

10.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

10.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

10.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

10.5Any failure or delay by a Party in exercising any of its rights, powers and

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remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

10.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

10.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby

10.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

10.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

10.10This Agreement shall be binding on its legal successors of the Parties.

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IN WITNESS HEREOF, the following Parties have caused this Exclusive Business Cooperation Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:

EX-10.6

Exhibit 10.6

EXCLUSIVE OPTION AGREEMENT

This Exclusive Option Agreement (this “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)Gridsum (Beijing) Management Consultation Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 42% of the equity interest in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Shareholder, the WFOE and Gridsum Holdco (the “Proxy Agreement”), the Shareholder has already authorized WFOE or its designatee with full power to exercise on its behalf all of its shareholder’s voting rights in Gridsum Holdco.

(c)The Shareholder, WFOE and Gridsum Holdco entered into an Equity Pledge Agreement dated on December 22, 2014 (the “Pledge Agreement”).

(d)WFOE and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”, together with the Proxy Agreement, the Pledge Agreement and this Agreement, the “Transaction Agreements”).

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Sale and Purchase of Equity Interest

1.1Option Granted

In consideration of WFOE entering into Transaction Documents and, the Shareholder hereby irrevocably grants WFOE an irrevocable and exclusive right to purchase, or designate one or more persons (each, a “Designee”) to purchase the equity interests in Gridsum Holdco then held by the Shareholder once or at

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multiple times at any time in part or in whole at WFOE’s sole and absolute discretion to the extent permitted by PRC laws and at the price described in Article 1.3 herein (the “Equity Interest Purchase Option”). Except for WFOE and the Designee(s), no other person shall be entitled to the Equity Interest Purchase Option or other rights with respect to the equity interests of the Shareholder. Gridsum Holdco hereby agrees to the grant by the Shareholder of the Equity Interest Purchase Option to WFOE. The term “person” as used herein shall refer to individuals, corporations, partnerships, partners, enterprises, trusts or non-corporate organizations.

1.2Steps for Exercise of the Equity Interest Purchase Options

Subject to the provisions of PRC laws and regulations, WFOE may exercise the Equity Interest Purchase Option by issuing a written notice to the Shareholder (the “Equity Interest Purchase Option Notice”), specifying: (i) WFOE’s decision to exercise the Equity Interest Purchase Option; (ii) the portion of equity interests to be purchased from the Shareholder (the “Optioned Interests”); (iii) the date for purchasing the Optioned Interests and/or the date for transfer of the Optioned Interests; and (iv) whether WFOE will purchase the Optioned Interests by itself or through the Designee(s).

1.3Equity Interest Purchase Price

The equity interest purchase price refers to all the consideration that WFOE and/or the Designee shall pay to the Shareholder for the Optioned Interests in every exercise of the Equity Interest Purchase Option. In every exercise of the Equity Interest Purchase Option by WFOE and/or the Designee, all the purchase prices that WFOE and/or the Designee shall pay to the Shareholder equal to the ratio of the Optioned Interests to the registered capital of Gridsum Holdco multiplied by RMB10.00. Where there is any mandatory provision regarding the then purchase price under the PRC laws, WFOE and/or the Designee shall, in accordance with the PRC laws, have the right to apply the lowest price as provided by the PRC laws as the purchase price.

1.4Transfer of Optioned Interests

For each exercise of the Equity Interest Purchase Options:

(a)Gridsum Holdco shall and the Shareholder shall cause Gridsum Holdco to promptly convene a shareholders’ meeting, at which a resolution shall be adopted approving the Shareholder’s transfer of the Optioned Interests to WFOE and/or the Designee(s);

(b)In case of exercise of the Equity Interest Purchase Option by WFOE, the Shareholder shall obtain written statements from the other shareholders of Gridsum Holdco giving consent to the transfer of the equity interest to WFOE and/or the Designee(s) and waiving any right of first refusal related thereto.

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(c)In case of exercise of the Equity Interest Purchase Option by WFOE, the Shareholder shall execute a share transfer contract with respect to each transfer with WFOE and/or each Designee (whichever is applicable), in accordance with the provisions of this Agreement and the Equity Interest Purchase Option Notice regarding the Optioned Interests;

(d)The relevant Parties shall execute all other necessary contracts, agreements or documents, obtain all necessary government licenses and permits and take all necessary actions to transfer valid ownership of the Optioned Interests to WFOE and/or the Designee(s), and cause WFOE and/or the Designee(s) to become the registered owner(s) of the Optioned Interests, free from any third party interest. For the purpose of this Article and this Agreement, the “third party interests” shall include securities, mortgages, third party’s rights or interests, any stock options, acquisition right, right of first refusal, right to offset, ownership retention or other security arrangements or right restrictions, but shall be deemed to exclude any security interest created by this Agreement and Pledge Agreement.

Article 2 Covenants

2.1The Shareholder (as the shareholder of Gridsum Holdco) and Gridsum Holdco hereby covenant as follows:

(a)without WFOE’s prior written consent, not to supplement, change or amend its articles of association, to increase or decrease its registered capital, or to change its capital structure in any manner;

(b)to maintain and operate its business activities prudently and effectively according to good financial and business standards;

(c)without WFOE’s prior written consent, not to sell, transfer, mortgage, or dispose of in any other manner, or to create other security interest on, any of its assets, business or legal right to collect interests;

(d)without WFOE’s prior written consent, not to create, succeed to, guarantee or permit any debt, except (i) the debt arising in the course of the ordinary or daily business operation, and (ii) the debt agreed to or confirmed by the WFOE in writing;

(e)to operate persistently all the business of Gridsum Holdco and to maintain the value of its assets;

(f)without WFOE’s prior written consent, not to enter into any material contract (a contract will be deemed material if its value exceeds RMB1,000,000);

(g)not to provide loan or credit to any person without WFOE’s prior written consent;

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(h)to provide to WFOE information concerning all of its operation and financial affairs upon WFOE’s request;

(i)to purchase insurance from insurance companies acceptable to WFOE in such amounts and of the kinds as are customarily carried and insured against by companies doing similar business and having similar assets in the place where Gridsum Holdco is located;

(j)not to merger or combine with, buy or invest in, any other person without WFOE’s prior written consent

(k)to inform promptly WFOE of any pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the assets, business or income of Gridsum Holdco;

(l)to execute all necessary or appropriate documents, to take all necessary or appropriate action and to bring all necessary or appropriate lawsuits or to make all necessary and appropriate defence against all claims, in order to maintain Gridsum Holdco’s ownership of all its assets;

(m)without WFOE’s prior written consent, not to distribute dividends to each shareholder in any form, provided however, that Gridsum Holdco shall promptly distribute all its distributable profits to each of its shareholders upon WFOE’s request;

(n)to appoint a Designee to be the director of Gridsum Holdco upon WFOE’s request; and

(o)to comply strictly with the terms of the this Agreement and the Business Cooperation Agreement, and to refrain from any action or omission that may affect the effectiveness and enforceability of this Agreement and the Business Cooperation Agreement.

2.2The Shareholder covenants that during the term of this Agreement, it shall:

(a)not to sell, transfer, mortgage, dispose of in any other manner, or create other security interest on, any of its legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except in accordance with the terms of the Pledge Agreement;

(b)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the sale, transfer, mortgage, disposition in any other manner, or creation of other security interest on, any of the Shareholder’s legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except that the counter party is WFOE or a Designee;

(c)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the merger or combination with, acquisition of or

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investment in, any person without WFOE’s prior written consent;

(d)promptly inform WFOE of the pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the equity interests in Gridsum Holdco held by the Shareholder;

(e)execute all necessary or appropriate documents, take all necessary or appropriate actions and bring all necessary or appropriate lawsuits or make all necessary and appropriate defence against all claims, in order to maintain the Shareholder’s ownership of its equity interests in Gridsum Holdco;

(f)without WFOE’s prior written consent, refrain from any action or omission that may have a material adverse effect on the assets, business and liabilities of Gridsum Holdco;

(g)appoint any person to be the director of Gridsum Holdco at the request of WFOE;

(h)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, promptly and unconditionally transfer all of the equity interests in Gridsum Holdco held by the Shareholder to WFOE or one or more Designees at any time and cause the other shareholder(s) of Gridsum Holdco to waive its/their right of first refusal to purchase the Shareholder’s equity interests in Gridsum Holdco;

(i)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, cause the other shareholder(s) of Gridsum Holdco to promptly and unconditionally transfer all equity of such other shareholder(s) in Gridsum Holdco to WFOE or one or more Designees at any time, and the Shareholder hereby waives its right of first refusal with respect to the equity transfer described in this article;

(j)comply strictly with the terms of this Agreement, Pledge Agreement, Loan Agreement and Proxy Agreement, fully perform all obligations under such agreements and refrain from any action or omission that may affect the effectiveness and enforceability of such agreements.

Article 3 Representations and Warranties

The Shareholder and Gridsum Holdco hereby represent and warrant to WFOE, jointly and severally, as of the date of this Agreement and each date of transfer of the Optioned Interests, that:

3.1They have the authorization to execute and deliver this Agreement, any share transfer contracts to which they are parties concerning the Optioned Interests to be transferred thereunder, and to perform their obligations under this Agreement and any share transfer contracts. The Shareholder and Gridsum Holdco agree to

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enter into share transfer contracts consistent with the terms of this Agreement upon WFOE’s exercise of the Equity Purchase Options. This Agreement and the share transfer contracts to which they are parties constitute or will constitute their legal, valid and binding obligations and shall be enforceable against them in accordance with the provisions thereof;

3.2The execution and delivery of this Agreement or any share transfer contracts and the obligations under this Agreement or any share transfer contracts shall not: (i) cause any violation of any applicable PRC laws; (ii) be inconsistent with the articles of association, bylaws or other organizational documents of Gridsum Holdco; (iii) cause the violation of any contracts or instruments to which they are parties or which are binding on them, or constitute any breach under any contracts or instruments to which they are parties or which are binding on them; (iv) cause any violation of any condition for the grant and/or continued effectiveness of any licenses or permits issued to either of them; or (v) cause the suspension or revocation of or imposition of additional conditions to any licenses or permits issued to either of them;

3.3The Shareholder has a good and merchantable title to the equity interests in Gridsum Holdco it holds. Except for Pledge Agreement, the Shareholder has not placed any security interest on such equity interests;

3.4Gridsum Holdco does not have any outstanding debts, except for (i) debt incurred in the ordinary course of business; and (ii) debts disclosed to WFOE for which WFOE’s written consent has been obtained;

3.5The Shareholder and Gridsum Holdco has complied with all applicable PRC laws and regulations to equity interest acquisition; and

3.6There are no pending or threatened litigation, arbitration or administrative proceedings relating to the equity interests in Gridsum Holdco, assets of Gridsum Holdco or Gridsum Holdco.

Article 4 Term of Agreement

This Agreement shall become effective upon the date hereof, and remain effective for a term of ten (10) years, and may be renewed at WFOE’s election.

Article 5 Notice

5.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

5.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

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Article 6 Miscellaneous

6.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

6.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

6.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

6.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

6.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

6.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

6.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

6.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

6.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

6.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third

7

parties designated by it after giving notice to the Shareholder.

6.11This Agreement shall be binding on its legal successors of the Parties.

[The remainder of this page is left blank]

8

IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Exclusive Option Agreement as of the date first here above written.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:
Gridsum (Beijing) Management Consultation Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:

EXCLUSIVE OPTION AGREEMENT

This Exclusive Option Agreement (this “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)QI Guosheng, a PRC citizen with ID card number: [ID number] (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 51% of the equity interest in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Shareholder, the WFOE and Gridsum Holdco (the “Proxy Agreement”), the Shareholder has already authorized WFOE or its designatee with full power to exercise on his/her behalf all of his/her shareholder’s voting rights in Gridsum Holdco.

(c)The Shareholder, WFOE and Gridsum Holdco entered into an Equity Pledge Agreement dated on December 22, 2014 (the “Pledge Agreement”).

(d)WFOE and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”, together with the Proxy Agreement, the Pledge Agreement and this Agreement, the “Transaction Agreements”).

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Sale and Purchase of Equity Interest

1.1Option Granted

In consideration of WFOE entering into Transaction Documents and, the Shareholder hereby irrevocably grants WFOE an irrevocable and exclusive right to purchase, or designate one or more persons (each, a “Designee”) to purchase the equity interests in Gridsum Holdco then held by the Shareholder once or at multiple times at any time in part or in whole at WFOE’s sole and absolute

10

discretion to the extent permitted by PRC laws and at the price described in Article 1.3 herein (the “Equity Interest Purchase Option”). Except for WFOE and the Designee(s), no other person shall be entitled to the Equity Interest Purchase Option or other rights with respect to the equity interests of the Shareholder. Gridsum Holdco hereby agrees to the grant by the Shareholder of the Equity Interest Purchase Option to WFOE. The term “person” as used herein shall refer to individuals, corporations, partnerships, partners, enterprises, trusts or non-corporate organizations.

1.2Steps for Exercise of the Equity Interest Purchase Options

Subject to the provisions of PRC laws and regulations, WFOE may exercise the Equity Interest Purchase Option by issuing a written notice to the Shareholder (the “Equity Interest Purchase Option Notice”), specifying: (i) WFOE’s decision to exercise the Equity Interest Purchase Option; (ii) the portion of equity interests to be purchased from the Shareholder (the “Optioned Interests”); (iii) the date for purchasing the Optioned Interests and/or the date for transfer of the Optioned Interests; and (iv) whether WFOE will purchase the Optioned Interests by itself or through the Designee(s).

1.3Equity Interest Purchase Price

The equity interest purchase price refers to all the consideration that WFOE and/or the Designee shall pay to the Shareholder for the Optioned Interests in every exercise of the Equity Interest Purchase Option. In every exercise of the Equity Interest Purchase Option by WFOE and/or the Designee, all the purchase prices that WFOE and/or the Designee shall pay to the Shareholder equal to the ratio of the Optioned Interests to the registered capital of Gridsum Holdco multiplied by RMB10.00. Where there is any mandatory provision regarding the then purchase price under the PRC laws, WFOE and/or the Designee shall, in accordance with the PRC laws, have the right to apply the lowest price as provided by the PRC laws as the purchase price.

1.4Transfer of Optioned Interests

For each exercise of the Equity Interest Purchase Options:

(a)Gridsum Holdco shall and the Shareholder shall cause Gridsum Holdco to promptly convene a shareholders’ meeting, at which a resolution shall be adopted approving the Shareholder’s transfer of the Optioned Interests to WFOE and/or the Designee(s);

(b)In case of exercise of the Equity Interest Purchase Option by WFOE, the Shareholder shall obtain written statements from the other shareholders of Gridsum Holdco giving consent to the transfer of the equity interest to WFOE and/or the Designee(s) and waiving any right of first refusal related thereto.

(c)In case of exercise of the Equity Interest Purchase Option by WFOE, the

11

Shareholder shall execute a share transfer contract with respect to each transfer with WFOE and/or each Designee (whichever is applicable), in accordance with the provisions of this Agreement and the Equity Interest Purchase Option Notice regarding the Optioned Interests;

(d)The relevant Parties shall execute all other necessary contracts, agreements or documents, obtain all necessary government licenses and permits and take all necessary actions to transfer valid ownership of the Optioned Interests to WFOE and/or the Designee(s), and cause WFOE and/or the Designee(s) to become the registered owner(s) of the Optioned Interests, free from any third party interest. For the purpose of this Article and this Agreement, the “third party interests” shall include securities, mortgages, third party’s rights or interests, any stock options, acquisition right, right of first refusal, right to offset, ownership retention or other security arrangements or right restrictions, but shall be deemed to exclude any security interest created by this Agreement and Pledge Agreement.

Article 2 Covenants

2.1The Shareholder (as the shareholder of Gridsum Holdco) and Gridsum Holdco hereby covenant as follows:

(a)without WFOE’s prior written consent, not to supplement, change or amend its articles of association, to increase or decrease its registered capital, or to change its capital structure in any manner;

(b)to maintain and operate its business activities prudently and effectively according to good financial and business standards;

(c)without WFOE’s prior written consent, not to sell, transfer, mortgage, or dispose of in any other manner, or to create other security interest on, any of its assets, business or legal right to collect interests;

(d)without WFOE’s prior written consent, not to create, succeed to, guarantee or permit any debt, except (i) the debt arising in the course of the ordinary or daily business operation, and (ii) the debt agreed to or confirmed by the WFOE in writing;

(e)to operate persistently all the business of Gridsum Holdco and to maintain the value of its assets;

(f)without WFOE’s prior written consent, not to enter into any material contract (a contract will be deemed material if its value exceeds RMB1,000,000);

(g)not to provide loan or credit to any person without WFOE’s prior written consent;

12

(h)to provide to WFOE information concerning all of its operation and financial affairs upon WFOE’s request;

(i)to purchase insurance from insurance companies acceptable to WFOE in such amounts and of the kinds as are customarily carried and insured against by companies doing similar business and having similar assets in the place where Gridsum Holdco is located;

(j)not to merger or combine with, buy or invest in, any other person without WFOE’s prior written consent

(k)to inform promptly WFOE of any pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the assets, business or income of Gridsum Holdco;

(l)to execute all necessary or appropriate documents, to take all necessary or appropriate action and to bring all necessary or appropriate lawsuits or to make all necessary and appropriate defence against all claims, in order to maintain Gridsum Holdco’s ownership of all its assets;

(m)without WFOE’s prior written consent, not to distribute dividends to each shareholder in any form, provided however, that Gridsum Holdco shall promptly distribute all its distributable profits to each of its shareholders upon WFOE’s request;

(n)to appoint a Designee to be the director of Gridsum Holdco upon WFOE’s request; and

(o)to comply strictly with the terms of the this Agreement and the Business Cooperation Agreement, and to refrain from any action or omission that may affect the effectiveness and enforceability of this Agreement and the Business Cooperation Agreement.

2.2The Shareholder covenants that during the term of this Agreement, he/she shall:

(a)not to sell, transfer, mortgage, dispose of in any other manner, or create other security interest on, any of its legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except in accordance with the terms of the Pledge Agreement;

(b)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the sale, transfer, mortgage, disposition in any other manner, or creation of other security interest on, any of the Shareholder’s legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except that the counter party is WFOE or a Designee;

(c)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the merger or combination with, acquisition of or

13

investment in, any person without WFOE’s prior written consent;

(d)promptly inform WFOE of the pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the equity interests in Gridsum Holdco held by the Shareholder;

(e)execute all necessary or appropriate documents, take all necessary or appropriate actions and bring all necessary or appropriate lawsuits or make all necessary and appropriate defence against all claims, in order to maintain the Shareholder’s ownership of his/her equity interests in Gridsum Holdco;

(f)without WFOE’s prior written consent, refrain from any action or omission that may have a material adverse effect on the assets, business and liabilities of Gridsum Holdco;

(g)appoint any person to be the director of Gridsum Holdco at the request of WFOE;

(h)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, promptly and unconditionally transfer all of the equity interests in Gridsum Holdco held by the Shareholder to WFOE or one or more Designees at any time and cause the other shareholder(s) of Gridsum Holdco to waive its/their right of first refusal to purchase the Shareholder’s equity interests in Gridsum Holdco;

(i)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, cause the other shareholder(s) of Gridsum Holdco to promptly and unconditionally transfer all equity of such other shareholder(s) in Gridsum Holdco to WFOE or one or more Designees at any time, and the Shareholder hereby waives his/her right of first refusal with respect to the equity transfer described in this article;

(j)comply strictly with the terms of this Agreement, Pledge Agreement, Loan Agreement and Proxy Agreement, fully perform all obligations under such agreements and refrain from any action or omission that may affect the effectiveness and enforceability of such agreements.

Article 3 Representations and Warranties

The Shareholder and Gridsum Holdco hereby represent and warrant to WFOE, jointly and severally, as of the date of this Agreement and each date of transfer of the Optioned Interests, that:

3.1They have the authorization to execute and deliver this Agreement, any share transfer contracts to which they are parties concerning the Optioned Interests to be transferred thereunder, and to perform their obligations under this Agreement and any share transfer contracts. The Shareholder and Gridsum Holdco agree to

14

enter into share transfer contracts consistent with the terms of this Agreement upon WFOE’s exercise of the Equity Purchase Options. This Agreement and the share transfer contracts to which they are parties constitute or will constitute their legal, valid and binding obligations and shall be enforceable against them in accordance with the provisions thereof;

3.2The execution and delivery of this Agreement or any share transfer contracts and the obligations under this Agreement or any share transfer contracts shall not: (i) cause any violation of any applicable PRC laws; (ii) be inconsistent with the articles of association, bylaws or other organizational documents of Gridsum Holdco; (iii) cause the violation of any contracts or instruments to which they are parties or which are binding on them, or constitute any breach under any contracts or instruments to which they are parties or which are binding on them; (iv) cause any violation of any condition for the grant and/or continued effectiveness of any licenses or permits issued to either of them; or (v) cause the suspension or revocation of or imposition of additional conditions to any licenses or permits issued to either of them;

3.3The Shareholder has a good and merchantable title to the equity interests in Gridsum Holdco he/she holds. Except for Pledge Agreement, the Shareholder has not placed any security interest on such equity interests;

3.4Gridsum Holdco does not have any outstanding debts, except for (i) debt incurred in the ordinary course of business; and (ii) debts disclosed to WFOE for which WFOE’s written consent has been obtained;

3.5The Shareholder and Gridsum Holdco has complied with all applicable PRC laws and regulations to equity interest acquisition; and

3.6There are no pending or threatened litigation, arbitration or administrative proceedings relating to the equity interests in Gridsum Holdco, assets of Gridsum Holdco or Gridsum Holdco.

Article 4 Term of Agreement

This Agreement shall become effective upon the date hereof, and remain effective for a term of ten (10) years, and may be renewed at WFOE’s election.

Article 5 Notice

5.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

5.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

15

Article 6 Miscellaneous

6.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

6.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

6.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

6.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

6.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

6.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

6.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

6.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

6.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

6.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third

16

parties designated by it after giving notice to the Shareholder.

6.11This Agreement shall be binding on its legal successors of the Parties.

[The remainder of this page is left blank]

17

IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Exclusive Option Agreement as of the date first here above written.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:
QI Guosheng
Signature:	/s/Qi Guosheng
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:

18

EXCLUSIVE OPTION AGREEMENT

This Exclusive Option Agreement (this “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)YU Guofa, a PRC citizen with ID card number: [ID number] (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 7% of the equity interest in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Shareholder, the WFOE and Gridsum Holdco (the “Proxy Agreement”), the Shareholder has already authorized WFOE or its designatee with full power to exercise on his/her behalf all of his/her shareholder’s voting rights in Gridsum Holdco.

(c)The Shareholder, WFOE and Gridsum Holdco entered into an Equity Pledge Agreement dated on December 22, 2014 (the “Pledge Agreement”).

(d)WFOE and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”, together with the Proxy Agreement, the Pledge Agreement and this Agreement, the “Transaction Agreements”).

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Sale and Purchase of Equity Interest

1.1Option Granted

In consideration of WFOE entering into Transaction Documents and, the Shareholder hereby irrevocably grants WFOE an irrevocable and exclusive right to purchase, or designate one or more persons (each, a “Designee”) to purchase the equity interests in Gridsum Holdco then held by the Shareholder once or at multiple times at any time in part or in whole at WFOE’s sole and absolute

19

discretion to the extent permitted by PRC laws and at the price described in Article 1.3 herein (the “Equity Interest Purchase Option”). Except for WFOE and the Designee(s), no other person shall be entitled to the Equity Interest Purchase Option or other rights with respect to the equity interests of the Shareholder. Gridsum Holdco hereby agrees to the grant by the Shareholder of the Equity Interest Purchase Option to WFOE. The term “person” as used herein shall refer to individuals, corporations, partnerships, partners, enterprises, trusts or non-corporate organizations.

1.2Steps for Exercise of the Equity Interest Purchase Options

Subject to the provisions of PRC laws and regulations, WFOE may exercise the Equity Interest Purchase Option by issuing a written notice to the Shareholder (the “Equity Interest Purchase Option Notice”), specifying: (i) WFOE’s decision to exercise the Equity Interest Purchase Option; (ii) the portion of equity interests to be purchased from the Shareholder (the “Optioned Interests”); (iii) the date for purchasing the Optioned Interests and/or the date for transfer of the Optioned Interests; and (iv) whether WFOE will purchase the Optioned Interests by itself or through the Designee(s).

1.3Equity Interest Purchase Price

The equity interest purchase price refers to all the consideration that WFOE and/or the Designee shall pay to the Shareholder for the Optioned Interests in every exercise of the Equity Interest Purchase Option. In every exercise of the Equity Interest Purchase Option by WFOE and/or the Designee, all the purchase prices that WFOE and/or the Designee shall pay to the Shareholder equal to the ratio of the Optioned Interests to the registered capital of Gridsum Holdco multiplied by RMB10.00. Where there is any mandatory provision regarding the then purchase price under the PRC laws, WFOE and/or the Designee shall, in accordance with the PRC laws, have the right to apply the lowest price as provided by the PRC laws as the purchase price.

1.4Transfer of Optioned Interests

For each exercise of the Equity Interest Purchase Options:

(a)Gridsum Holdco shall and the Shareholder shall cause Gridsum Holdco to promptly convene a shareholders’ meeting, at which a resolution shall be adopted approving the Shareholder’s transfer of the Optioned Interests to WFOE and/or the Designee(s);

(b)In case of exercise of the Equity Interest Purchase Option by WFOE, the Shareholder shall obtain written statements from the other shareholders of Gridsum Holdco giving consent to the transfer of the equity interest to WFOE and/or the Designee(s) and waiving any right of first refusal related thereto.

(c)In case of exercise of the Equity Interest Purchase Option by WFOE, the

20

Shareholder shall execute a share transfer contract with respect to each transfer with WFOE and/or each Designee (whichever is applicable), in accordance with the provisions of this Agreement and the Equity Interest Purchase Option Notice regarding the Optioned Interests;

(d)The relevant Parties shall execute all other necessary contracts, agreements or documents, obtain all necessary government licenses and permits and take all necessary actions to transfer valid ownership of the Optioned Interests to WFOE and/or the Designee(s), and cause WFOE and/or the Designee(s) to become the registered owner(s) of the Optioned Interests, free from any third party interest. For the purpose of this Article and this Agreement, the “third party interests” shall include securities, mortgages, third party’s rights or interests, any stock options, acquisition right, right of first refusal, right to offset, ownership retention or other security arrangements or right restrictions, but shall be deemed to exclude any security interest created by this Agreement and Pledge Agreement.

Article 2 Covenants

2.1The Shareholder (as the shareholder of Gridsum Holdco) and Gridsum Holdco hereby covenant as follows:

(a)without WFOE’s prior written consent, not to supplement, change or amend its articles of association, to increase or decrease its registered capital, or to change its capital structure in any manner;

(b)to maintain and operate its business activities prudently and effectively according to good financial and business standards;

(c)without WFOE’s prior written consent, not to sell, transfer, mortgage, or dispose of in any other manner, or to create other security interest on, any of its assets, business or legal right to collect interests;

(d)without WFOE’s prior written consent, not to create, succeed to, guarantee or permit any debt, except (i) the debt arising in the course of the ordinary or daily business operation, and (ii) the debt agreed to or confirmed by the WFOE in writing;

(e)to operate persistently all the business of Gridsum Holdco and to maintain the value of its assets;

(f)without WFOE’s prior written consent, not to enter into any material contract (a contract will be deemed material if its value exceeds RMB1,000,000);

(g)not to provide loan or credit to any person without WFOE’s prior written consent;

21

(h)to provide to WFOE information concerning all of its operation and financial affairs upon WFOE’s request;

(i)to purchase insurance from insurance companies acceptable to WFOE in such amounts and of the kinds as are customarily carried and insured against by companies doing similar business and having similar assets in the place where Gridsum Holdco is located;

(j)not to merger or combine with, buy or invest in, any other person without WFOE’s prior written consent

(k)to inform promptly WFOE of any pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the assets, business or income of Gridsum Holdco;

(l)to execute all necessary or appropriate documents, to take all necessary or appropriate action and to bring all necessary or appropriate lawsuits or to make all necessary and appropriate defence against all claims, in order to maintain Gridsum Holdco’s ownership of all its assets;

(m)without WFOE’s prior written consent, not to distribute dividends to each shareholder in any form, provided however, that Gridsum Holdco shall promptly distribute all its distributable profits to each of its shareholders upon WFOE’s request;

(n)to appoint a Designee to be the director of Gridsum Holdco upon WFOE’s request; and

(o)to comply strictly with the terms of the this Agreement and the Business Cooperation Agreement, and to refrain from any action or omission that may affect the effectiveness and enforceability of this Agreement and the Business Cooperation Agreement.

2.2The Shareholder covenants that during the term of this Agreement, he/she shall:

(a)not to sell, transfer, mortgage, dispose of in any other manner, or create other security interest on, any of its legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except in accordance with the terms of the Pledge Agreement;

(b)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the sale, transfer, mortgage, disposition in any other manner, or creation of other security interest on, any of the Shareholder’s legal or beneficial interest in the equity interests in Gridsum Holdco without WFOE’s prior written consent, except that the counter party is WFOE or a Designee;

(c)cause any shareholder’s meeting and/or the board of directors of Gridsum Holdco not to approve the merger or combination with, acquisition of or

22

investment in, any person without WFOE’s prior written consent;

(d)promptly inform WFOE of the pending or threatened litigation, arbitration, administrative proceedings or other legal proceedings concerning the equity interests in Gridsum Holdco held by the Shareholder;

(e)execute all necessary or appropriate documents, take all necessary or appropriate actions and bring all necessary or appropriate lawsuits or make all necessary and appropriate defence against all claims, in order to maintain the Shareholder’s ownership of his/her equity interests in Gridsum Holdco;

(f)without WFOE’s prior written consent, refrain from any action or omission that may have a material adverse effect on the assets, business and liabilities of Gridsum Holdco;

(g)appoint any person to be the director of Gridsum Holdco at the request of WFOE;

(h)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, promptly and unconditionally transfer all of the equity interests in Gridsum Holdco held by the Shareholder to WFOE or one or more Designees at any time and cause the other shareholder(s) of Gridsum Holdco to waive its/their right of first refusal to purchase the Shareholder’s equity interests in Gridsum Holdco;

(i)to the extent permitted by the applicable PRC laws, at the request of WFOE at any time, cause the other shareholder(s) of Gridsum Holdco to promptly and unconditionally transfer all equity of such other shareholder(s) in Gridsum Holdco to WFOE or one or more Designees at any time, and the Shareholder hereby waives his/her right of first refusal with respect to the equity transfer described in this article;

(j)comply strictly with the terms of this Agreement, Pledge Agreement, Loan Agreement and Proxy Agreement, fully perform all obligations under such agreements and refrain from any action or omission that may affect the effectiveness and enforceability of such agreements.

Article 3 Representations and Warranties

The Shareholder and Gridsum Holdco hereby represent and warrant to WFOE, jointly and severally, as of the date of this Agreement and each date of transfer of the Optioned Interests, that:

3.1They have the authorization to execute and deliver this Agreement, any share transfer contracts to which they are parties concerning the Optioned Interests to be transferred thereunder, and to perform their obligations under this Agreement and any share transfer contracts. The Shareholder and Gridsum Holdco agree to

23

enter into share transfer contracts consistent with the terms of this Agreement upon WFOE’s exercise of the Equity Purchase Options. This Agreement and the share transfer contracts to which they are parties constitute or will constitute their legal, valid and binding obligations and shall be enforceable against them in accordance with the provisions thereof;

3.2The execution and delivery of this Agreement or any share transfer contracts and the obligations under this Agreement or any share transfer contracts shall not: (i) cause any violation of any applicable PRC laws; (ii) be inconsistent with the articles of association, bylaws or other organizational documents of Gridsum Holdco; (iii) cause the violation of any contracts or instruments to which they are parties or which are binding on them, or constitute any breach under any contracts or instruments to which they are parties or which are binding on them; (iv) cause any violation of any condition for the grant and/or continued effectiveness of any licenses or permits issued to either of them; or (v) cause the suspension or revocation of or imposition of additional conditions to any licenses or permits issued to either of them;

3.3The Shareholder has a good and merchantable title to the equity interests in Gridsum Holdco he/she holds. Except for Pledge Agreement, the Shareholder has not placed any security interest on such equity interests;

3.4Gridsum Holdco does not have any outstanding debts, except for (i) debt incurred in the ordinary course of business; and (ii) debts disclosed to WFOE for which WFOE’s written consent has been obtained;

3.5The Shareholder and Gridsum Holdco has complied with all applicable PRC laws and regulations to equity interest acquisition; and

3.6There are no pending or threatened litigation, arbitration or administrative proceedings relating to the equity interests in Gridsum Holdco, assets of Gridsum Holdco or Gridsum Holdco.

Article 4 Term of Agreement

This Agreement shall become effective upon the date hereof, and remain effective for a term of ten (10) years, and may be renewed at WFOE’s election.

Article 5 Notice

5.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

5.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

24

Article 6 Miscellaneous

6.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

6.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

6.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

6.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

6.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

6.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

6.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

6.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

6.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

6.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third

25

parties designated by it after giving notice to the Shareholder.

6.11This Agreement shall be binding on its legal successors of the Parties.

[The remainder of this page is left blank]

26

IN WITNESS WHEREOF, the Parties have caused their authorized representatives to execute this Exclusive Option Agreement as of the date first here above written.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:
YU Guofa
Signature:	/s/Yu Guofa
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name:  Qi Guosheng
Title:

27

EX-10.7

Exhibit 10.7

SHAREHOLDERS’ VOTING RIGHTS PROXY AGREEMENT

This Shareholders’ Voting Rights Proxy Agreement (the “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)Gridsum (Beijing) Management Consultation Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 42% of the equity interest in Gridsum Holdco.

(b)The Shareholder intends to authorize WFOE with the exercises of its voting rights as a shareholder in Gridsum Holdco, and WFOE is willing to accept such authorization.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Voting Rights Proxy

1.1The Shareholder hereby irrevocably authorizes WFOE or the designee designated by WFOE (the “Designee”) at its sole discretion, acting on behalf of itself as its exclusive agent and attorney with respect to all matters concerning its shareholder’s rights as shareholder of Gridsum Holdco, to exercise including without limitation the following rights (the “Entrusted Rights”) during the term of this Agreement pursuant to the then valid and effective article of association of Gridsum Holdco:

(a)to propose, convene and attend shareholders meetings of Gridsum Holdco as its proxy;

(b)Exercising all the shareholder’s voting rights on behalf of the Shareholder with respect to any matter subject to the discussion and resolutions of the shareholders under PRC laws or the articles of association of Gridsum Holdco, including but not limited to the sales, transfer, pledge or disposition of its equity interest in Gridsum Holdco in part or in whole, and the designation and election on behalf of it the legal representative, the director, the supervisor, the chief executive officer and other senior management members of Gridsum Holdco to

1

be appointed and removed by the shareholders of Gridsum Holdco;

(c)Other shareholder’s voting rights it is entitled to under the PRC laws (including the amendments, revisions, supplementary and re-constituted rules of such PRC laws, regardless of which comes into effect after or has taken into effect before the date hereof); and

(d)Other shareholder’s voting rights entitled to under the articles of association of Gridsum Holdco, including those provided in the amendments to the articles of association of Gridsum Holdco.

1.2The Designee shall perform the Entrusted Rights within the scope of entrustment in due care and prudence and in compliance with laws; the Shareholder acknowledges and assumes relevant liabilities for any legal consequences of the Designee’s exercise of the foregoing Entrusted Rights.

Article 2 Right to Information

For the purpose of exercising the Entrusted Rights under this Agreement, Designee is entitled to know the information with regard to Gridsum Holdco’s operation, business, clients, finance, staff, etc., and shall have access to relevant materials of Gridsum Holdco. Gridsum Holdco shall adequately cooperate with Designee in this regard.

Article 3 Exercise of Entrusted Rights

3.1The Shareholder will provide adequate assistance to the exercise of the Entrusted Rights by Designees, including execution of pertinent legal documents when necessary (e.g., to satisfy governmental requirements in case of examination and approval of or registration or filing).

3.2If at any time during the term of this Agreement, the entrustment or exercise of the Entrusted Rights under this Agreement is unenforceable for any reason except for default of the Shareholder or Gridsum Holdco, the Parties shall immediately seek a most similar substitute for the unenforceable provision and, if necessary, enter into supplementary agreement to amend or adjust the provisions herein, in order to ensure the realization of the purpose of this Agreement.

Article 4 Exemption and Compensation

4.1The Parties acknowledge that WFOE shall not be requested to be liable for or compensate (monetary or otherwise) other Parties or any third party due to exercise of Entrusted Rights by Designees under this Agreement.

4.2The Shareholder and Gridsum Holdco agree to indemnify WFOE and hold it harmless against all of its losses incurred or likely to incur due to exercise of the Entrusted Rights by the Designees, including without limitation any loss resulting from any litigation, demand, arbitration or claim initiated or raised by any third party against it or from administrative investigation or penalty of governmental authorities. However, the Shareholder and Gridsum Holdco will not compensate for losses incurred due to willful

2

misconduct or gross negligence of WFOE.

Article 5 Representations, Warranties and Covenants

5.1The Shareholder hereby represents, warrants and covenants that:

(a)it has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

(b)it is enrolled and legal shareholders of Gridsum Holdco as of the effective date of this Agreement and there exists no third party rights or exercise restriction on the Entrusted Rights.

(c)Pursuant to this Agreement, Designees is capable to fully and sufficiently exercise the Entrusted Rights in accordance with then effective articles of association of Gridsum Holdco.

5.2Gridsum Holdco hereby represents, warrants and covenants that:

(a)it is a limited liability company duly registered and validly existing under PRC laws with complete and independent status as a legal person and has due authorization to execute, deliver and perform this Agreement and is capable of acting independently as a subject of legal actions.

(b)it has the full right and authorization to execute and deliver this Agreement and all other documents relating to the transaction contemplated hereunder, and has the full right and authorization to consummate such transaction.

(c)The Shareholder is an enrolled shareholder of it as of the effective date of this Agreement.

Article 6 Term of Agreement

6.1The Agreement shall become effect when this Agreement is duly executed by Parties until that the Shareholder transfers all equity shares held by it in Gridsum Holdco (i.e. 42% equity interest of Gridsum Holdco) to WFOE is approved by Ministry of Commerce and all registration change with Industry and Commerce Administration for such shares transfer is completed.

Article 7 Notice

7.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

7.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

3

Article 8 Default Liability

8.1The Parties agree and confirm that, if any of the Parties (the “Defaulting Party”) breaches substantially any of the provisions herein or fails substantially to perform any of the obligations hereunder, such a breach or failure shall constitute a default under this Agreement (a “Default”). In such event any of the other Parties without default (a “Non-Defaulting Party”) who incurs losses arising from such Default shall have the right to require the Defaulting Party to rectify such Default or take remedial measures within a reasonable period. If the Defaulting Party fails to rectify such Default or take remedial measures within such reasonable period or within ten (10) days of a Non-Defaulting Party’s notifying the Defaulting Party in writing and requiring it to rectify the Default, then the relevant Non-Defaulting Party shall be entitled to choose at its discretion to (i) terminate this Agreement and require the Defaulting Party to indemnify all damages, or (ii) require specific performance by the Defaulting Party of this Agreement and indemnification against all damages suffered.

8.2The Parties agree and confirm, the Shareholder or Gridsum Holdco shall not request the termination of this Agreement for whatsoever reason and under whatsoever circumstance, except otherwise stipulated by laws or this Agreement.

8.3Notwithstanding any other provisions herein, the validity of this Article shall not be affected by the suspension or termination of this Agreement.

Article 9 Miscellaneous

9.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

9.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

9.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

9.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

9.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of

4

such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

9.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

9.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

9.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

9.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

9.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third parties designated by it after giving notice to the Shareholder.

9.11This Agreement shall be binding on its legal successors of the Parties.

[The remainder of this page is left blank]

5

IN WITNESS HEREOF, the following Parties have caused this Shareholders’ Voting Rights Proxy Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
Gridsum (Beijing) Management Consultation Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

SHAREHOLDERS’ VOTING RIGHTS PROXY AGREEMENT

This Shareholders’ Voting Rights Proxy Agreement (the “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)QI Guosheng, a PRC citizen with ID card number: [ID number] (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 51% of the equity interest in Gridsum Holdco.

(b)The Shareholder intends to authorize WFOE with the exercises of his/her voting rights as a shareholder in Gridsum Holdco, and WFOE is willing to accept such authorization.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Voting Rights Proxy

1.1The Shareholder hereby irrevocably authorizes WFOE or the designee designated by WFOE (the “Designee”) at its sole discretion, acting on behalf of himself/herself as his/her exclusive agent and attorney with respect to all matters concerning his/her shareholder’s rights as shareholder of Gridsum Holdco, to exercise including without limitation the following rights (the “Entrusted Rights”) during the term of this Agreement pursuant to the then valid and effective article of association of Gridsum Holdco:

(a)to propose, convene and attend shareholders meetings of Gridsum Holdco as his/her proxy;

(b)Exercising all the shareholder’s voting rights on behalf of the Shareholder with respect to any matter subject to the discussion and resolutions of the shareholders under PRC laws or the articles of association of Gridsum Holdco, including but not limited to the sales, transfer, pledge or disposition of his/her equity interest in Gridsum Holdco in part or in whole, and the designation and election on behalf of him/her the legal representative, the director, the supervisor, the chief executive officer and other senior management members of

7

Gridsum Holdco to be appointed and removed by the shareholders of Gridsum Holdco;

(c)Other shareholder’s voting rights he/she is entitled to under the PRC laws (including the amendments, revisions, supplementary and re-constituted rules of such PRC laws, regardless of which comes into effect after or has taken into effect before the date hereof); and

(d)Other shareholder’s voting rights entitled to under the articles of association of Gridsum Holdco, including those provided in the amendments to the articles of association of Gridsum Holdco.

1.2The Designee shall perform the Entrusted Rights within the scope of entrustment in due care and prudence and in compliance with laws; the Shareholder acknowledges and assumes relevant liabilities for any legal consequences of the Designee’s exercise of the foregoing Entrusted Rights.

Article 2 Right to Information

For the purpose of exercising the Entrusted Rights under this Agreement, Designee is entitled to know the information with regard to Gridsum Holdco’s operation, business, clients, finance, staff, etc., and shall have access to relevant materials of Gridsum Holdco. Gridsum Holdco shall adequately cooperate with Designee in this regard.

Article 3 Exercise of Entrusted Rights

3.1The Shareholder will provide adequate assistance to the exercise of the Entrusted Rights by Designees, including execution of pertinent legal documents when necessary (e.g., to satisfy governmental requirements in case of examination and approval of or registration or filing).

3.2If at any time during the term of this Agreement, the entrustment or exercise of the Entrusted Rights under this Agreement is unenforceable for any reason except for default of the Shareholder or Gridsum Holdco, the Parties shall immediately seek a most similar substitute for the unenforceable provision and, if necessary, enter into supplementary agreement to amend or adjust the provisions herein, in order to ensure the realization of the purpose of this Agreement.

Article 4 Exemption and Compensation

4.1The Parties acknowledge that WFOE shall not be requested to be liable for or compensate (monetary or otherwise) other Parties or any third party due to exercise of Entrusted Rights by Designees under this Agreement.

4.2The Shareholder and Gridsum Holdco agree to indemnify WFOE and hold it harmless against all of its losses incurred or likely to incur due to exercise of the Entrusted Rights by the Designees, including without limitation any loss resulting from any litigation, demand, arbitration or claim initiated or raised by any third party against it or from administrative investigation or penalty of governmental authorities. However, the

8

Shareholder and Gridsum Holdco will not compensate for losses incurred due to willful misconduct or gross negligence of WFOE.

Article 5 Representations, Warranties and Covenants

5.1The Shareholder hereby represents, warrants and covenants that:

(a)he/she has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

(b)he/she is enrolled and legal shareholders of Gridsum Holdco as of the effective date of this Agreement and there exists no third party rights or exercise restriction on the Entrusted Rights.

(c)Pursuant to this Agreement, Designees is capable to fully and sufficiently exercise the Entrusted Rights in accordance with then effective articles of association of Gridsum Holdco.

5.2Gridsum Holdco hereby represents, warrants and covenants that:

(a)It is a limited liability company duly registered and validly existing under PRC laws with complete and independent status as a legal person and has due authorization to execute, deliver and perform this Agreement and is capable of acting independently as a subject of legal actions.

(b)It has the full right and authorization to execute and deliver this Agreement and all other documents relating to the transaction contemplated hereunder, and has the full right and authorization to consummate such transaction.

(c)The Shareholder is an enrolled shareholder of it as of the effective date of this Agreement.

Article 6 Term of Agreement

6.1The Agreement shall become effect when this Agreement is duly executed by Parties until that the Shareholder transfers all equity shares held by him/her in Gridsum Holdco (i.e. 51% equity interest of Gridsum Holdco) to WFOE is approved by Ministry of Commerce and all registration change with Industry and Commerce Administration for such shares transfer is completed.

Article 7 Notice

7.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

7.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if

9

received in person, or when five (5) days have elapsed after posting if posted by mail.

Article 8 Default Liability

8.1The Parties agree and confirm that, if any of the Parties (the “Defaulting Party”) breaches substantially any of the provisions herein or fails substantially to perform any of the obligations hereunder, such a breach or failure shall constitute a default under this Agreement (a “Default”). In such event any of the other Parties without default (a “Non-Defaulting Party”) who incurs losses arising from such Default shall have the right to require the Defaulting Party to rectify such Default or take remedial measures within a reasonable period. If the Defaulting Party fails to rectify such Default or take remedial measures within such reasonable period or within ten (10) days of a Non-Defaulting Party’s notifying the Defaulting Party in writing and requiring it to rectify the Default, then the relevant Non-Defaulting Party shall be entitled to choose at its discretion to (i) terminate this Agreement and require the Defaulting Party to indemnify all damages, or (ii) require specific performance by the Defaulting Party of this Agreement and indemnification against all damages suffered.

8.2The Parties agree and confirm, the Shareholder or Gridsum Holdco shall not request the termination of this Agreement for whatsoever reason and under whatsoever circumstance, except otherwise stipulated by laws or this Agreement.

8.3Notwithstanding any other provisions herein, the validity of this Article shall not be affected by the suspension or termination of this Agreement.

Article 9 Miscellaneous

9.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

9.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

9.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

9.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

10

9.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

9.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

9.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

9.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

9.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

9.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third parties designated by it after giving notice to the Shareholder.

9.11This Agreement shall be binding on its legal successors of the Parties.

[The remainder of this page is left blank]

11

IN WITNESS HEREOF, the following Parties have caused this Shareholders’ Voting Rights Proxy Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
QI Guosheng
Signature:	/s/Qi Guosheng
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

12

SHAREHOLDERS’ VOTING RIGHTS PROXY AGREEMENT

This Shareholders’ Voting Rights Proxy Agreement (the “Agreement”) is entered into in the People’s Republics of China (“PRC”) as of December 22, 2014 by and among the following parties:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC laws (“WFOE”),

(b)YU Guofa, a PRC citizen with ID card number: [ID number] (the “Shareholder”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Shareholder is the enrolled shareholder of Gridsum Holdco, legally holding 7% of the equity interest in Gridsum Holdco.

(b)The Shareholder intends to authorize WFOE with the exercises of his/her voting rights as a shareholder in Gridsum Holdco, and WFOE is willing to accept such authorization.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Voting Rights Proxy

1.1The Shareholder hereby irrevocably authorizes WFOE or the designee designated by WFOE (the “Designee”) at its sole discretion, acting on behalf of himself/herself as his/her exclusive agent and attorney with respect to all matters concerning his/her shareholder’s rights as shareholder of Gridsum Holdco, to exercise including without limitation the following rights (the “Entrusted Rights”) during the term of this Agreement pursuant to the then valid and effective article of association of Gridsum Holdco:

(a)to propose, convene and attend shareholders meetings of Gridsum Holdco as his/her proxy;

(b)Exercising all the shareholder’s voting rights on behalf of the Shareholder with respect to any matter subject to the discussion and resolutions of the shareholders under PRC laws or the articles of association of Gridsum Holdco, including but not limited to the sales, transfer, pledge or disposition of his/her equity interest in Gridsum Holdco in part or in whole, and the designation and election on behalf of him/her the legal representative, the director, the supervisor, the chief executive officer and other senior management members of Gridsum Holdco to be appointed and removed by the shareholders of Gridsum

13

Holdco;

(c)Other shareholder’s voting rights he/she is entitled to under the PRC laws (including the amendments, revisions, supplementary and re-constituted rules of such PRC laws, regardless of which comes into effect after or has taken into effect before the date hereof); and

(d)Other shareholder’s voting rights entitled to under the articles of association of Gridsum Holdco, including those provided in the amendments to the articles of association of Gridsum Holdco.

1.2The Designee shall perform the Entrusted Rights within the scope of entrustment in due care and prudence and in compliance with laws; the Shareholder acknowledges and assumes relevant liabilities for any legal consequences of the Designee’s exercise of the foregoing Entrusted Rights.

Article 2 Right to Information

For the purpose of exercising the Entrusted Rights under this Agreement, Designee is entitled to know the information with regard to Gridsum Holdco’s operation, business, clients, finance, staff, etc., and shall have access to relevant materials of Gridsum Holdco. Gridsum Holdco shall adequately cooperate with Designee in this regard.

Article 3 Exercise of Entrusted Rights

3.1The Shareholder will provide adequate assistance to the exercise of the Entrusted Rights by Designees, including execution of pertinent legal documents when necessary (e.g., to satisfy governmental requirements in case of examination and approval of or registration or filing).

3.2If at any time during the term of this Agreement, the entrustment or exercise of the Entrusted Rights under this Agreement is unenforceable for any reason except for default of the Shareholder or Gridsum Holdco, the Parties shall immediately seek a most similar substitute for the unenforceable provision and, if necessary, enter into supplementary agreement to amend or adjust the provisions herein, in order to ensure the realization of the purpose of this Agreement.

Article 4 Exemption and Compensation

4.1The Parties acknowledge that WFOE shall not be requested to be liable for or compensate (monetary or otherwise) other Parties or any third party due to exercise of Entrusted Rights by Designees under this Agreement.

4.2The Shareholder and Gridsum Holdco agree to indemnify WFOE and hold it harmless against all of its losses incurred or likely to incur due to exercise of the Entrusted Rights by the Designees, including without limitation any loss resulting from any litigation, demand, arbitration or claim initiated or raised by any third party against it or from administrative investigation or penalty of governmental authorities. However, the Shareholder and Gridsum Holdco will not compensate for losses incurred due to willful

14

misconduct or gross negligence of WFOE.

Article 5 Representations, Warranties and Covenants

5.1The Shareholder hereby represents, warrants and covenants that:

(a)he/she has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

(b)he/she is enrolled and legal shareholders of Gridsum Holdco as of the effective date of this Agreement and there exists no third party rights or exercise restriction on the Entrusted Rights.

(c)Pursuant to this Agreement, Designees is capable to fully and sufficiently exercise the Entrusted Rights in accordance with then effective articles of association of Gridsum Holdco.

5.2Gridsum Holdco hereby represents, warrants and covenants that:

(a)It is a limited liability company duly registered and validly existing under PRC laws with complete and independent status as a legal person and has due authorization to execute, deliver and perform this Agreement and is capable of acting independently as a subject of legal actions.

(b)It has the full right and authorization to execute and deliver this Agreement and all other documents relating to the transaction contemplated hereunder, and has the full right and authorization to consummate such transaction.

(c)The Shareholder is an enrolled shareholder of it as of the effective date of this Agreement.

Article 6 Term of Agreement

6.1The Agreement shall become effect when this Agreement is duly executed by Parties until that the Shareholder transfers all equity shares held by him/her in Gridsum Holdco (i.e. 7% equity interest of Gridsum Holdco) to WFOE is approved by Ministry of Commerce and all registration change with Industry and Commerce Administration for such shares transfer is completed.

Article 7 Notice

7.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant Party.

7.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile, or when it is delivered if received in person, or when five (5) days have elapsed after posting if posted by mail.

15

Article 8 Default Liability

8.1The Parties agree and confirm that, if any of the Parties (the “Defaulting Party”) breaches substantially any of the provisions herein or fails substantially to perform any of the obligations hereunder, such a breach or failure shall constitute a default under this Agreement (a “Default”). In such event any of the other Parties without default (a “Non-Defaulting Party”) who incurs losses arising from such Default shall have the right to require the Defaulting Party to rectify such Default or take remedial measures within a reasonable period. If the Defaulting Party fails to rectify such Default or take remedial measures within such reasonable period or within ten (10) days of a Non-Defaulting Party’s notifying the Defaulting Party in writing and requiring it to rectify the Default, then the relevant Non-Defaulting Party shall be entitled to choose at its discretion to (i) terminate this Agreement and require the Defaulting Party to indemnify all damages, or (ii) require specific performance by the Defaulting Party of this Agreement and indemnification against all damages suffered.

8.2The Parties agree and confirm, the Shareholder or Gridsum Holdco shall not request the termination of this Agreement for whatsoever reason and under whatsoever circumstance, except otherwise stipulated by laws or this Agreement.

8.3Notwithstanding any other provisions herein, the validity of this Article shall not be affected by the suspension or termination of this Agreement.

Article 9 Miscellaneous

9.1This Agreement is written in both Chinese and English language in three (3) original copies, with each involved Party holding one (1) copy hereof with equal legal validity; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

9.2The conclusion, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by laws of the PRC.

9.3Any disputes arising from and in connection with this Agreement shall be settled through consultations among the Parties involved, and if the Parties involved fail to reach an agreement regarding such a dispute within thirty (30) days of its occurrence, such dispute shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such commission, and the arbitration award shall be final and binding on all the Parties involved.

9.4Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and a Party’s exercise of any of its rights, powers and remedies shall not preclude its exercise of other rights, powers and remedies of it.

9.5Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of

16

such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way or exercising the remaining part of the Party’s Rights.

9.6The titles of the Articles contained herein are for reference only, and in no circumstances shall such titles be used for or affect the interpretation of the provisions hereof.

9.7Each provision contained herein shall be severable and independent from each of other provisions. If at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected thereby.

9.8Upon execution, this Agreement shall replace any other previous legal documents entered into by relevant Parties on the same subject matter.

9.9Any amendments or supplements to this Agreement shall be made in writing and shall take effect only when properly signed by the Parties to this Agreement.

9.10In respect of the Shareholder and Gridsum Holdco, they shall not assign any of their rights and/or transfer any of their obligations hereunder to any third parties without prior written consent from WFOE; WFOE shall have the right to assign any of its rights and/or transfer any of its obligations hereunder to any third parties designated by it after giving notice to the Shareholder.

9.11This Agreement shall be binding on its legal successors of the Parties.

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IN WITNESS HEREOF, the following Parties have caused this Shareholders’ Voting Rights Proxy Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
YU Guofa
Signature:	/s/Yu Guofa
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

18

EX-10.8

Exhibit 10.8

EQUITY PLEDGE AGREEMENT

This Equity Pledge Agreement (the “Agreement”) is entered into in the People’s Republic of China (“PRC”) as of December 22, 2014 by and among:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC Law (the “Pledgee”),

(b)Gridsum (Beijing) Management Consultation Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC laws (the “Pledgor”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC Law (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Pledgor is the enrolled shareholder of Gridsum Holdco, legally holding 42% of the equity interest, representing RMB420,000 of the registered capital, in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Pledgee, the Pledgor and Gridsum Holdco (the “Proxy Agreement”), Pledgor has already authorized Pledgee with full power to exercise on its behalf all of its voting rights as a shareholder in Gridsum Holdco.

(c)The Pledgee, the Pledgor and Gridsum Holdco entered into an Exclusive Option Agreement dated on December 22, 2014 (the “Option Agreement”).

(d)The Pledgee and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”).

(e)As security for performance by Pledgor of the Contract Obligations (as defined below) and repayment of the Guaranteed Liabilities (as defined below), Pledgor agrees to pledge all of its equity interests in Gridsum Holdco to the Pledgee and grant the Pledgee right to request for repayment on first priority and Gridsum Holdco agrees such equity pledge arrangement.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Definition

1.1Unless otherwise construed in the context, the following terms in the Agreement shall be interpreted to have the following meanings:

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“Contract Obligations”	shall mean all contractual obligations of the Pledgor under the Proxy Agreement and the Option Agreement; all contractual obligations of Gridsum Holdco under Proxy Agreement, Option Agreement and the Business Cooperation Agreement, and all contractual obligations of the Pledgor and Gridsum Holdco under this Agreement.
“Guaranteed Liabilities”	shall mean all direct, indirect and consequential losses and losses of foreseeable profits suffered by Pledgee due to any Breaching Event (as defined below) by the Pledgor and/or Gridsum Holdco, and all fees incurred by Pledgee for the enforcement of the Contractual Obligations of the Pledgor and/or Gridsum Holdco.
“Transaction Agreements”	shall mean collectively the Proxy Agreement, the Option Agreement, the Business Cooperation Agreement and this Agreement.
“Breaching Event”	shall mean any breach by either Pledgor of its Contract Obligations under the Transaction Agreements; any breach by Gridsum Holdco of its Contract Obligations under the Transaction Agreements.
“Pledged Property”	shall mean the equity interest in Gridsum Holdco which is legally owned by the Pledgor as of the effective date hereof and is to be pledged by the Pledgor to the Pledgee according to provisions hereof as security for performance of the Pledgor and Gridsum Holdco of their Contractual Obligations, and any increased capital contribution and equity interest described in Articles 2.6 and 2.7 hereof.
“PRC Law”	shall mean the then valid laws, administrative regulations, administrative rules, local regulations, judicial interpretations and other binding regulatory documents of PRC.

1.2The references to any PRC Law herein shall be deemed (i) to include any references to the amendments, changes, supplements and reenactments of such law, irrespective of whether they take effect before or after the formation of this Agreement; and (ii) to include any references to other decisions, notices or regulations enacted in accordance

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therewith or effective as a result thereof.

1.3Unless otherwise stated in the context herein, all references to an Article, clause, item or paragraph shall refer to the relevant part of this Agreement.

Article 2 Equity Pledge

2.1Pledgor hereby agrees to pledge the Pledged Property, which it legally owns and has the right to dispose of, to Pledgee according to the provisions hereof as the security for the performance of the Contract Obligations and the repayment of the Guaranteed Liabilities. Gridsum Holdco hereby agrees that the Pledgor who legally hold equity interest in it to pledge the Pledged Property to the Pledgee according to the provisions hereof.

2.2Pledgor hereby covenants that it will be responsible for, recording the arrangement of the equity pledge hereunder (the “Equity Pledge”) on the shareholder register of Gridsum Holdco on the date hereof, and will do its best endeavor to make registration with registration authorities of industry and commerce where Gridsum Holdco registers. Gridsum Holdco covenants that it will do its best to cooperate with the Pledgor to complete the registration with authorities of industry and commerce under this Article.

2.3During the valid term of this Agreement, except for the willful misconduct or gross negligence of Pledgee which has direct cause and effect relationship with the reduction in value of the Pledged Property, Pledgee shall not be liable in any way to, nor shall Pledgor have any right to claim in any way or propose any demands on Pledgee, in respect of the said reduction in value of the Pledged Property.

2.4To the extent not violating provision of Article 2.3 above, in case of any possibility of obvious reduction in value of the Pledged Property which is sufficient to jeopardize Pledgee’s rights, Pledgee may at any time auction or sell off the Pledged Property on behalf of Pledgor, and negotiate with Pledgor to use the proceeds from such auction or sale-off as pre-repayment of the Guaranteed Liabilities, or may submit such proceeds to the local notary institution to keep where Pledgee are domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

2.5The Pledgee shall be deemed to have created the encumbrance of first order in priority on the Pledged Property, and in case of any Breaching Event, Pledgee shall have the right to dispose of the Pledged Property in the way set out in Article 4 hereof.

2.6Only upon prior consent by Pledgee, Pledgor may increase its capital contribution to Gridsum Holdco. Further capital contribution made by Pledgor in Gridsum Holdco shall also be part of the Pledged Property.

2.7Only upon prior consent by Pledgee, Pledgor may be able to receive dividends or share profits from the Pledged Property. The dividends or the profits received by Pledgor from the Pledged Property shall be deposited into a bank account designated by Pledgee to be under the supervision of Pledgee and used as the Pledged Property to repay in priority the Guaranteed Liabilities.

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Article 3 Release of Pledge

In respect of equity interest of Gridsum Holdco, upon full and complete performance by Pledgor of all of its Contract Obligations and upon the full repayment by Pledgor of all the Guaranteed Liabilities (if any), the Pledgee shall, at the request of Pledgor, release the pledge created on Gridsum Holdco under this Agreement, and shall cooperate with Pledgor to go through the formalities to cancel the record of the Equity Pledge in the shareholder register of Gridsum Holdco; in case of the Equity Pledge having been recorded at the registration department of Administration of Industry and Commerce where Gridsum Holdco registers, the relevant Parties shall cooperate with each other to go through the formalities to cancel such record of the Equity Pledge. The reasonable fees incurred in connection with such release to be borne by Pledgee.

Article 4 Disposal of the Pledged Property

4.1Parties hereby agree that, in case of any Breaching Event, the Pledgee shall have the right to exercise, upon giving written notice to Pledgor, all of the remedial rights and powers enjoyable by it under PRC Law, Transaction Agreements and the terms hereof, including but not limited to being repaid in priority with proceeds from auctions or sale-offs of the Pledged Property. Pledgee shall not be liable for any loss as the result of their reasonable exercise of such rights and powers.

4.2Pledgee shall have the right to designate in writing its legal counsel or other agents to exercise on its behalf any and all rights and powers set out above, and neither Pledgor nor Gridsum Holdco shall not oppose thereto.

4.3The reasonable costs incurred by Pledgee in connection with exercise of any and all rights and powers set out above shall be borne by Pledgor, and Pledgee shall have the right to deduct such costs actually incurred from the proceeds acquired from the exercise of the rights and powers.

4.4The proceeds that Pledgee acquires from the exercise of their respective rights and powers shall be used in the priority order as follows:

Firstly, to pay any cost incurred in connection with the disposal of the Pledged Property and the exercise by Pledgee of its rights and powers (including remuneration paid to their respective legal counsels and agents);

Secondly, to pay any taxes and levies payable for the disposal of the Pledged Property; and

Thirdly, to repay Pledgee for the Guaranteed Liabilities.

In case of any balance after payment of the above amounts, Pledgee shall return it to Pledgor or other persons entitled thereto according to the relevant laws and rules or submit it to the local notary institution for keeping where Pledgee is domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

4.5Pledgee shall have the option to exercise, simultaneously or in certain sequence, any of

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the remedies at breaching that it is entitled to in respect of the equity interest of Gridsum Holdco held by Pledgor. Pledgee shall not be obliged to exercise any other remedies at breaching before exercise of the right to the auctions or sale-offs of the Pledged Property hereunder. Pledgor or Gridsum Holdco shall not oppose to whether Pledgee exercises any part of the right to the pledge or the sequence of exercising the pledge interest.

Article 5 Continuity and No Waive

The Equity Pledge hereunder is a continuous guarantee, with its validity to continue until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities. Neither exemption or grace period granted by Pledgee to Pledgor in respect of its breach, nor delay by Pledgee in exercising any of its rights under the Transaction Agreements and this Agreement shall affect the rights of Pledgee under this Agreement, relevant PRC Law and the Transaction Agreements, the rights of Pledgee to demand at any time thereafter the strict performance of the Transaction Agreements and this Agreement by Pledgor or the rights Pledgee may be entitled to due to subsequent breach by Pledgor of the obligations under the Transaction Agreements and/or this Agreement.

Article 6 Pledgor’s Representations and Warranties

Pledgor hereby, in respect of itself and Gridsum Holdco in which it holds equity interest, represents and warrants to Pledgee as follows:

6.1it has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

6.2Gridsum Holdco in which the Pledgor holds equity interest is a limited liability company duly incorporated and validly existing under PRC Law, it has independent status as a legal person. It has full and independent legal status and capacity to execute, deliver and perform this Agreement and can independently be a subject of actions. It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as stipulated in this Agreement and to be executed by it. It also has full right and authorization to complete the transaction stipulated in this Agreement.

6.3All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the effectiveness hereof.

6.4All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects as of the time when such reports, documents and information are provided.

6.5At the time of the effectiveness of this Agreement, Pledgor is the sole legal owner of the Pledged Property, with no existing dispute whatsoever concerning the ownership of the Pledged Property. Pledgor has the right to dispose of the Pledged Property or any part

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thereof.

6.6Except for the encumbrance set on the Pledged Property hereunder and the rights set under the Transaction Agreements, there is no other encumbrance or third party interests set on the Pledged Property.

6.7The Pledged Property is capable of being pledged or transferred according to the laws, and Pledgor has the full right and power to pledge the Pledged Property to Pledgee according to this Agreement.

6.8This Agreement constitutes the legal, valid and binding obligations on Pledgor when it is duly executed by Pledgor.

6.9Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder have already been handled or obtained, and will be fully effective during the valid term of this Agreement.

6.10The execution and performance by Pledgor of this Agreement are not in violation of or conflict with any laws applicable to it, or any agreement to which it is a party or which has binding effect on its assets, any court judgment, any arbitration award, or any administration authority decision.

6.11The pledge hereunder constitutes the encumbrance of first order in priority on the Pledged Property.

6.12All taxes and fees payable in connection with acquisition of the Pledged Property have already been paid in full amount by Pledgor.

6.13There is no pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Pledgor, or its property, or the Pledged Property, nor is there any pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any government authority or any administration authority against Pledgor, or its property, or the Pledged Property, which is of material or detrimental effect on the economic status of Pledgor or its capability to perform the obligations hereunder and the Guaranteed Liabilities.

6.14Pledgor hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 7 Gridsum Holdco’s Representations and Warranties

Gridsum Holdco hereby represents and warrants to Pledgee as follows:

7.1Gridsum Holdco is a limited liability company duly incorporated and validly existing

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under PRC Law, with full capacity of disposition and has obtained due authorization to execute, deliver and perform this Agreement and can independently be a subject of actions.

7.2All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the execution hereof

7.3All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects upon provision.

7.4This Agreement constitutes the legal, valid and binding obligations on Gridsum Holdco when it is duly executed by Gridsum Holdco

7.5It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as contemplated hereunder, and has full right and authorization to consummate such transaction.

7.6There is no pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), nor is there any pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any government authority or any administration authority against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), which is of material or detrimental effect on the economic status of Gridsum Holdco or its capability to perform the obligations hereunder and the Guaranteed Liabilities.

7.7Gridsum Holdco hereby agrees to bear joint responsibilities to Pledgee in respect of the representations and Warranties made by Plegor according to Article 6.5, Article 6.6, Article 6.7, Article 6.9 and Article 6.11 hereof.

7.8Gridsum Holdco hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 8 Pledgor’s Covenants

Pledgor hereby covenants to Pledgee in respect of itself and Gridsum Holdco of which it holds equity as follows:

8.1Without prior written consent by Pledgee, Pledgor shall not establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

8.2Without first giving written notice to Pledgee and having Pledgee’s prior written consent, Pledgor shall not transfer the Pledged Property, and any attempt by Pledgor to

7

transfer the Pledged Property shall be null and void. The proceeds from transfer of the Pledged Property by Pledgor shall be used to repay to Pledgee in advance the Guaranteed Liabilities or deposit the same to the third party agreed with Pledgee.

8.3In case of any litigation, arbitration or other arbitration which may affect detrimentally the interest of Pledgor or Pledgee under the Transaction Agreements and hereunder or the Pledged Property, Pledgor undertakes to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

8.4Pledgor shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

8.5Pledgor guarantees that it shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

8.6In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Pledgor guarantees that it will take all necessary measures to realize such assignment.

Article 9 Gridsum Holdco’s Covenants

9.1Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder will be cooperated to handle or obtain by Gridsum Holdco to its best and will be ensured to remain full effective during the valid term of this Agreement.

9.2Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

9.3Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to transfer or permit to transfer the Pledged Property.

9.4In case of any litigation, arbitration or other arbitration which may affect detrimentally Gridsum Holdco, the equity of Gridsum Holdco as the Pledged Property or the interest of Pledgee under the Transaction Agreements and hereunder, Gridsum Holdco covenants to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

9.5Gridsum Holdco shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

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9.6Gridsum Holdco shall provide Pledgee with the financial statement of the last calendar season within the first month of each calendar season, including but are not limited to the balance sheet, the income statement and the statement of cash flow.

9.7Gridsum Holdco guarantees that it shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

9.8In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Gridsum Holdco guarantees that it will take all necessary measures to realize such assignment.

Article 10 Change of Circumstances

As supplement and subject to compliance with other terms of the Transaction Agreements and this Agreement, in case that at any time the promulgation or change of any PRC Law, regulations or rules, or change in interpretation or application of such laws, regulations and rules, or the change of the relevant registration procedures enables Pledgee to believe that it will be illegal or in conflict with such laws, regulations or rules to further maintain the effectiveness of this Agreement and/or dispose of the Pledged Property in the way provided herein, Pledgor and Gridsum Holdco shall, at the written direction of Pledgee and in accordance with the reasonable request of Pledgee, promptly take actions and/or execute any agreement or other document, in order to:

(a)keep this Agreement remain in effect;

(b)facilitate the disposal of the Pledged Property in the way provided herein; and/or

(c)maintain or realize the intention or the guarantee established hereunder.

Article 11 Term of Agreement

11.1This Agreement shall become effective when this Agreement is duly executed by Pledgee, Gridsum Holdco and the Pledgor.

11.2This Agreement shall have its valid term until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities.

Article 12 Notice

12.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant party.

12.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile; it shall be deemed to have been delivered when it is delivered if received in person; it shall be deemed to have been delivered five (5) days after posting the same if posted by mail.

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Article 13 Miscellaneous

13.1Pledgee may, upon notice to Pledgor and Gridsum Holdco but not necessarily with Pledgor and Gridsum Holdco’s consent, assign Pledgee’s rights and/or obligations hereunder to any third party; provided that Pledgor or Gridsum Holdco can not, without Pledgee’s prior written consent, assign Pledgor’ rights, obligations and/or liabilities hereunder to any third party. Successors or permitted assignees (if any) of Pledgor and Gridsum Holdco shall continue to perform the obligations of Pledgor and Gridsum Holdco under this Agreement.

13.2This Agreement is written in both Chinese and English language in four (4) original copies, with each involved Party holding one (1) copy hereof with equal legal validity and one (1) copy for registration of Equity Pledge with industry and commerce administration; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

13.3The formation, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by PRC Law.

13.4Any disputes arising hereunder and in connection herewith shall be settled through consultations among the Parties, and if the Parties cannot reach an agreement regarding such disputes within thirty (30) days of their occurrence, such disputes shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such Commission, and the arbitration award shall be final and binding on all disputing Parties.

13.5Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and the exercise of its rights, powers and remedies by a Party shall not preclude its exercise of its other rights, powers and remedies by such Party.

13.6Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way and exercising the remaining part of the Party’s Rights.

13.7The titles of the Articles contained herein shall be for reference only, and in no circumstances shall such titles be used in or affect the interpretation of the provisions hereof.

13.8Each provision contained herein shall be severable and independent from each of other provisions, and if at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected as a result thereof.

13.9This Agreement shall substitute any other documents on the same subject executed by relevant Parties hereof once duly executed.

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13.10Any amendments or supplements to this Agreement shall be made in writing. Except for assignment by Pledgee of its rights hereunder according to Article 13.1 of this Agreement, the amendments or supplements to this Agreement shall take effect only when properly signed by the Parties to this Agreement.

13.11This Agreement shall be binding on the legal successors of the Parties.

13.12All costs actually incurred in connection with the establishment of the Equity Pledge hereunder, including but not limited to stamp duties, any other taxes, all legal fees, etc shall be borne by the Pledgee.

[The remainder of this page is left blank]

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IN WITNESS HEREOF, the following Parties have caused this Equity Pledge Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
Gridsum (Beijing) Management Consultation Co., Ltd. (Company Seal)
Signature :	/s/Qi Guosheng
Name: Qi Guosheng
Title:
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

EQUITY PLEDGE AGREEMENT

This Equity Pledge Agreement (the “Agreement”) is entered into in the People’s Republic of China (“PRC”) as of December 22, 2014 by and among:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC Law (the “Pledgee”),

(b)QI Guosheng, a PRC citizen with ID card number: [ID number] (the “Pledgor”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC Law (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Pledgor is the enrolled shareholder of Gridsum Holdco, legally holding 51% of the equity interest, representing RMB510,000 of the registered capital, in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Pledgee, the Pledgor and Gridsum Holdco (the “Proxy Agreement”), Pledgor has already authorized Pledgee with full power to exercise on his/her behalf all of his/her voting rights as a shareholder in Gridsum Holdco.

(c)The Pledgee, the Pledgor and Gridsum Holdco entered into an Exclusive Option Agreement dated on December 22, 2014 (the “Option Agreement”).

(d)The Pledgee and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”).

(e)As security for performance by Pledgor of the Contract Obligations (as defined below) and repayment of the Guaranteed Liabilities (as defined below), Pledgor agrees to pledge all of his/her equity interests in Gridsum Holdco to the Pledgee and grant the Pledgee right to request for repayment on first priority and Gridsum Holdco agrees such equity pledge arrangement.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Definition

1.1Unless otherwise construed in the context, the following terms in the Agreement shall be interpreted to have the following meanings:

“Contract Obligations” shall mean all contractual obligations of the Pledgor under the Proxy Agreement and the

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	Option Agreement; all contractual obligations of Gridsum Holdco under Proxy Agreement, Option Agreement and the Business Cooperation Agreement, and all contractual obligations of the Pledgor and Gridsum Holdco under this Agreement.
“Guaranteed Liabilities”	shall mean all direct, indirect and consequential losses and losses of foreseeable profits suffered by Pledgee due to any Breaching Event (as defined below) by the Pledgor and/or Gridsum Holdco, and all fees incurred by Pledgee for the enforcement of the Contractual Obligations of the Pledgor and/or Gridsum Holdco.
“Transaction Agreements”	shall mean collectively the Proxy Agreement, the Option Agreement, the Business Cooperation Agreement and this Agreement.
“Breaching Event”	shall mean any breach by either Pledgor of its Contract Obligations under the Transaction Agreements; any breach by Gridsum Holdco of its Contract Obligations under the Transaction Agreements.
“Pledged Property”	shall mean the equity interest in Gridsum Holdco which is legally owned by the Pledgor as of the effective date hereof and is to be pledged by the Pledgor to the Pledgee according to provisions hereof as security for performance of the Pledgor and Gridsum Holdco of their Contractual Obligations, and any increased capital contribution and equity interest described in Articles 2.6 and 2.7 hereof.
“PRC Law”	shall mean the then valid laws, administrative regulations, administrative rules, local regulations, judicial interpretations and other binding regulatory documents of PRC.

1.2The references to any PRC Law herein shall be deemed (i) to include any references to the amendments, changes, supplements and reenactments of such law, irrespective of whether they take effect before or after the formation of this Agreement; and (ii) to include any references to other decisions, notices or regulations enacted in accordance therewith or effective as a result thereof.

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1.3Unless otherwise stated in the context herein, all references to an Article, clause, item or paragraph shall refer to the relevant part of this Agreement.

Article 2 Equity Pledge

2.1Pledgor hereby agrees to pledge the Pledged Property, which it legally owns and has the right to dispose of, to Pledgee according to the provisions hereof as the security for the performance of the Contract Obligations and the repayment of the Guaranteed Liabilities. Gridsum Holdco hereby agrees that the Pledgor who legally hold equity interest in it to pledge the Pledged Property to the Pledgee according to the provisions hereof.

2.2Pledgor hereby covenants that he/she will be responsible for, recording the arrangement of the equity pledge hereunder (the “Equity Pledge”) on the shareholder register of Gridsum Holdco on the date hereof, and will do its best endeavor to make registration with registration authorities of industry and commerce where Gridsum Holdco registers. Gridsum Holdco covenants that it will do its best to cooperate with the Pledgor to complete the registration with authorities of industry and commerce under this Article.

2.3During the valid term of this Agreement, except for the willful misconduct or gross negligence of Pledgee which has direct cause and effect relationship with the reduction in value of the Pledged Property, Pledgee shall not be liable in any way to, nor shall Pledgor have any right to claim in any way or propose any demands on Pledgee, in respect of the said reduction in value of the Pledged Property.

2.4To the extent not violating provision of Article 2.3 above, in case of any possibility of obvious reduction in value of the Pledged Property which is sufficient to jeopardize Pledgee’s rights, Pledgee may at any time auction or sell off the Pledged Property on behalf of Pledgor, and negotiate with Pledgor to use the proceeds from such auction or sale-off as pre-repayment of the Guaranteed Liabilities, or may submit such proceeds to the local notary institution to keep where Pledgee are domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

2.5The Pledgee shall be deemed to have created the encumbrance of first order in priority on the Pledged Property, and in case of any Breaching Event, Pledgee shall have the right to dispose of the Pledged Property in the way set out in Article 4 hereof.

2.6Only upon prior consent by Pledgee, Pledgor may increase his/her capital contribution to Gridsum Holdco. Further capital contribution made by Pledgor in Gridsum Holdco shall also be part of the Pledged Property.

2.7Only upon prior consent by Pledgee, Pledgor may be able to receive dividends or share profits from the Pledged Property. The dividends or the profits received by Pledgor from the Pledged Property shall be deposited into a bank account designated by Pledgee to be under the supervision of Pledgee and used as the Pledged Property to repay in priority the Guaranteed Liabilities.

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Article 3 Release of Pledge

In respect of equity interest of Gridsum Holdco, upon full and complete performance by Pledgor of all of his/her Contract Obligations and upon the full repayment by Pledgor of all the Guaranteed Liabilities (if any), the Pledgee shall, at the request of Pledgor, release the pledge created on Gridsum Holdco under this Agreement, and shall cooperate with Pledgor to go through the formalities to cancel the record of the Equity Pledge in the shareholder register of Gridsum Holdco; in case of the Equity Pledge having been recorded at the registration department of Administration of Industry and Commerce where Gridsum Holdco registers, the relevant Parties shall cooperate with each other to go through the formalities to cancel such record of the Equity Pledge. The reasonable fees incurred in connection with such release to be borne by Pledgee.

Article 4 Disposal of the Pledged Property

4.1Parties hereby agree that, in case of any Breaching Event, the Pledgee shall have the right to exercise, upon giving written notice to Pledgor, all of the remedial rights and powers enjoyable by it under PRC Law, Transaction Agreements and the terms hereof, including but not limited to being repaid in priority with proceeds from auctions or sale-offs of the Pledged Property. Pledgee shall not be liable for any loss as the result of their reasonable exercise of such rights and powers.

4.2Pledgee shall have the right to designate in writing its legal counsel or other agents to exercise on its behalf any and all rights and powers set out above, and neither Pledgor nor Gridsum Holdco shall not oppose thereto.

4.3The reasonable costs incurred by Pledgee in connection with exercise of any and all rights and powers set out above shall be borne by Pledgor, and Pledgee shall have the right to deduct such costs actually incurred from the proceeds acquired from the exercise of the rights and powers.

4.4The proceeds that Pledgee acquires from the exercise of their respective rights and powers shall be used in the priority order as follows:

Firstly, to pay any cost incurred in connection with the disposal of the Pledged Property and the exercise by Pledgee of its rights and powers (including remuneration paid to their respective legal counsels and agents);

Secondly, to pay any taxes and levies payable for the disposal of the Pledged Property; and

Thirdly, to repay Pledgee for the Guaranteed Liabilities.

In case of any balance after payment of the above amounts, Pledgee shall return it to Pledgor or other persons entitled thereto according to the relevant laws and rules or submit it to the local notary institution for keeping where Pledgee is domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

4.5Pledgee shall have the option to exercise, simultaneously or in certain sequence, any of the remedies at breaching that it is entitled to in respect of the equity interest of Gridsum Holdco held by Pledgor. Pledgee shall not be obliged to exercise any other remedies at

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breaching before exercise of the right to the auctions or sale-offs of the Pledged Property hereunder. Pledgor or Gridsum Holdco shall not oppose to whether Pledgee exercises any part of the right to the pledge or the sequence of exercising the pledge interest.

Article 5 Continuity and No Waive

The Equity Pledge hereunder is a continuous guarantee, with its validity to continue until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities. Neither exemption or grace period granted by Pledgee to Pledgor in respect of his/her breach, nor delay by Pledgee in exercising any of its rights under the Transaction Agreements and this Agreement shall affect the rights of Pledgee under this Agreement, relevant PRC Law and the Transaction Agreements, the rights of Pledgee to demand at any time thereafter the strict performance of the Transaction Agreements and this Agreement by Pledgor or the rights Pledgee may be entitled to due to subsequent breach by Pledgor of the obligations under the Transaction Agreements and/or this Agreement.

Article 6 Pledgor’s Representations and Warranties

Pledgor hereby, in respect of himself/herself and Gridsum Holdco in which he/she holds equity interest, represents and warrants to Pledgee as follows:

6.1he/she has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

6.2Gridsum Holdco in which the Pledgor holds equity interest is a limited liability company duly incorporated and validly existing under PRC Law, it has independent status as a legal person. It has full and independent legal status and capacity to execute, deliver and perform this Agreement and can independently be a subject of actions. It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as stipulated in this Agreement and to be executed by it. It also has full right and authorization to complete the transaction stipulated in this Agreement.

6.3All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the effectiveness hereof.

6.4All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects as of the time when such reports, documents and information are provided.

6.5At the time of the effectiveness of this Agreement, Pledgor is the sole legal owner of the Pledged Property, with no existing dispute whatsoever concerning the ownership of the Pledged Property. Pledgor has the right to dispose of the Pledged Property or any part thereof.

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6.6Except for the encumbrance set on the Pledged Property hereunder and the rights set under the Transaction Agreements, there is no other encumbrance or third party interests set on the Pledged Property.

6.7The Pledged Property is capable of being pledged or transferred according to the laws, and Pledgor has the full right and power to pledge the Pledged Property to Pledgee according to this Agreement.

6.8This Agreement constitutes the legal, valid and binding obligations on Pledgor when it is duly executed by Pledgor.

6.9Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder have already been handled or obtained, and will be fully effective during the valid term of this Agreement.

6.10The execution and performance by Pledgor of this Agreement are not in violation of or conflict with any laws applicable to him/her, or any agreement to which he/she is a party or which has binding effect on his/her assets, any court judgment, any arbitration award, or any administration authority decision.

6.11The pledge hereunder constitutes the encumbrance of first order in priority on the Pledged Property.

6.12All taxes and fees payable in connection with acquisition of the Pledged Property have already been paid in full amount by Pledgor.

6.13There is no pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Pledgor, or his/her property, or the Pledged Property, nor is there any pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any government authority or any administration authority against Pledgor, or his/her property, or the Pledged Property, which is of material or detrimental effect on the economic status of Pledgor or his/her capability to perform the obligations hereunder and the Guaranteed Liabilities.

6.14Pledgor hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 7 Gridsum Holdco’s Representations and Warranties

Gridsum Holdco hereby represents and warrants to Pledgee as follows:

7.1Gridsum Holdco is a limited liability company duly incorporated and validly existing under PRC Law, with full capacity of disposition and has obtained due authorization to execute, deliver and perform this Agreement and can independently be a subject of

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actions.

7.2All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the execution hereof

7.3All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects upon provision.

7.4This Agreement constitutes the legal, valid and binding obligations on Gridsum Holdco when it is duly executed by Gridsum Holdco.

7.5It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as contemplated hereunder, and has full right and authorization to consummate such transaction.

7.6There is no pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), nor is there any pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any government authority or any administration authority against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), which is of material or detrimental effect on the economic status of Gridsum Holdco or its capability to perform the obligations hereunder and the Guaranteed Liabilities.

7.7Gridsum Holdco hereby agrees to bear joint responsibilities to Pledgee in respect of the representations and Warranties made by Plegor according to Article 6.5, Article 6.6, Article 6.7, Article 6.9 and Article 6.11 hereof.

7.8Gridsum Holdco hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 8 Pledgor’s Covenants

Pledgor hereby covenants to Pledgee in respect of himself/herself and Gridsum Holdco of which he/she holds equity as follows:

8.1Without prior written consent by Pledgee, Pledgor shall not establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

8.2Without first giving written notice to Pledgee and having Pledgee’s prior written consent, Pledgor shall not transfer the Pledged Property, and any attempt by Pledgor to transfer the Pledged Property shall be null and void. The proceeds from transfer of the Pledged Property by Pledgor shall be used to repay to Pledgee in advance the

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Guaranteed Liabilities or deposit the same to the third party agreed with Pledgee.

8.3In case of any litigation, arbitration or other arbitration which may affect detrimentally the interest of Pledgor or Pledgee under the Transaction Agreements and hereunder or the Pledged Property, Pledgor undertakes to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

8.4Pledgor shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

8.5Pledgor guarantees that he/she shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

8.6In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Pledgor guarantees that he/she will take all necessary measures to realize such assignment.

Article 9 Gridsum Holdco’s Covenants

9.1Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder will be cooperated to handle or obtain by Gridsum Holdco to its best and will be ensured to remain full effective during the valid term of this Agreement.

9.2Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

9.3Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to transfer or permit to transfer the Pledged Property.

9.4In case of any litigation, arbitration or other arbitration which may affect detrimentally Gridsum Holdco, the equity of Gridsum Holdco as the Pledged Property or the interest of Pledgee under the Transaction Agreements and hereunder, Gridsum Holdco covenants to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

9.5Gridsum Holdco shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

9.6Gridsum Holdco shall provide Pledgee with the financial statement of the last calendar

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season within the first month of each calendar season, including but are not limited to the balance sheet, the income statement and the statement of cash flow.

9.7Gridsum Holdco guarantees that it shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

9.8In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Gridsum Holdco guarantees that it will take all necessary measures to realize such assignment.

Article 10 Change of Circumstances

As supplement and subject to compliance with other terms of the Transaction Agreements and this Agreement, in case that at any time the promulgation or change of any PRC Law, regulations or rules, or change in interpretation or application of such laws, regulations and rules, or the change of the relevant registration procedures enables Pledgee to believe that it will be illegal or in conflict with such laws, regulations or rules to further maintain the effectiveness of this Agreement and/or dispose of the Pledged Property in the way provided herein, Pledgor and Gridsum Holdco shall, at the written direction of Pledgee and in accordance with the reasonable request of Pledgee, promptly take actions and/or execute any agreement or other document, in order to:

(a)keep this Agreement remain in effect;

(b)facilitate the disposal of the Pledged Property in the way provided herein; and/or

(c)maintain or realize the intention or the guarantee established hereunder.

Article 11 Term of Agreement

11.1This Agreement shall become effective when this Agreement is duly executed by Pledgee, Gridsum Holdco and the Pledgor.

11.2This Agreement shall have its valid term until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities.

Article 12 Notice

12.3Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant party.

12.4The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile; it shall be deemed to have been delivered when it is delivered if received in person; it shall be deemed to have been delivered five (5) days after posting the same if posted by mail.

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Article 13 Miscellaneous

13.1Pledgee may, upon notice to Pledgor and Gridsum Holdco but not necessarily with Pledgor and Gridsum Holdco’s consent, assign Pledgee’s rights and/or obligations hereunder to any third party; provided that Pledgor or Gridsum Holdco can not, without Pledgee’s prior written consent, assign Pledgor’ rights, obligations and/or liabilities hereunder to any third party. Successors or permitted assignees (if any) of Pledgor and Gridsum Holdco shall continue to perform the obligations of Pledgor and Gridsum Holdco under this Agreement.

13.2This Agreement is written in both Chinese and English language in four (4) original copies, with each involved Party holding one (1) copy hereof with equal legal validity and one (1) copy for registration of Equity Pledge with industry and commerce administration; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

13.3The formation, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by PRC Law.

13.4Any disputes arising hereunder and in connection herewith shall be settled through consultations among the Parties, and if the Parties cannot reach an agreement regarding such disputes within thirty (30) days of their occurrence, such disputes shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such Commission, and the arbitration award shall be final and binding on all disputing Parties.

13.5Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and the exercise of its rights, powers and remedies by a Party shall not preclude its exercise of its other rights, powers and remedies by such Party.

13.6Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way and exercising the remaining part of the Party’s Rights.

13.7The titles of the Articles contained herein shall be for reference only, and in no circumstances shall such titles be used in or affect the interpretation of the provisions hereof.

13.8Each provision contained herein shall be severable and independent from each of other provisions, and if at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected as a result thereof.

13.9This Agreement shall substitute any other documents on the same subject executed by relevant Parties hereof once duly executed.

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13.10Any amendments or supplements to this Agreement shall be made in writing. Except for assignment by Pledgee of its rights hereunder according to Article 13.1 of this Agreement, the amendments or supplements to this Agreement shall take effect only when properly signed by the Parties to this Agreement.

13.11This Agreement shall be binding on the legal successors of the Parties.

13.12All costs actually incurred in connection with the establishment of the Equity Pledge hereunder, including but not limited to stamp duties, any other taxes, all legal fees, etc shall be borne by the Pledgee.

[The remainder of this page is left blank]

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IN WITNESS HEREOF, the following Parties have caused this Equity Pledge Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
QI Guosheng
Signature:	/s/Qi Guosheng
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

EQUITY PLEDGE AGREEMENT

This Equity Pledge Agreement (the “Agreement”) is entered into in the People’s Republic of China (“PRC”) as of December 22, 2014 by and among:

(a)Dissector (Beijing) Technology Co. Ltd., a limited liability company wholly owned by foreign investor, incorporated and validly existing in Beijing, PRC under PRC Law (the “Pledgee”),

(b)YU Guofa, a PRC citizen with ID card number: [ID number] (the “Pledgor”), and

(c)Gridsum Holding (Beijing) Co., Ltd., a limited liability company incorporated and validly existing in Beijing, PRC under PRC Law (“Gridsum Holdco”).

The above parties hereinafter shall be individually referred to as a “Party” and collectively referred to as the “Parties”.

Whereas:

(a)As of the date of the Agreement, the Pledgor is the enrolled shareholder of Gridsum Holdco, legally holding 7% of the equity interest, representing RMB70,000 of the registered capital, in Gridsum Holdco.

(b)Pursuant to the Shareholders’ Voting Rights Proxy Agreement dated as of December 22, 2014 among the Pledgee, the Pledgor and Gridsum Holdco (the “Proxy Agreement”), Pledgor has already authorized Pledgee with full power to exercise on his/her behalf all of his/her voting rights as a shareholder in Gridsum Holdco.

(c)The Pledgee, the Pledgor and Gridsum Holdco entered into an Exclusive Option Agreement dated on December 22, 2014 (the “Option Agreement”).

(d)The Pledgee and Gridsum Holdco entered into an Exclusive Business Cooperation Agreement dated December 22, 2014 (the “Business Cooperation Agreement”).

(e)As security for performance by Pledgor of the Contract Obligations (as defined below) and repayment of the Guaranteed Liabilities (as defined below), Pledgor agrees to pledge all of his/her equity interests in Gridsum Holdco to the Pledgee and grant the Pledgee right to request for repayment on first priority and Gridsum Holdco agrees such equity pledge arrangement.

The Parties hereby have reached the following agreement upon friendly consultations:

Article 1 Definition

1.1Unless otherwise construed in the context, the following terms in the Agreement shall be interpreted to have the following meanings:

shall mean all contractual obligations of the Pledgor under the Proxy Agreement and the

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“Contract Obligations”	Option Agreement; all contractual obligations of Gridsum Holdco under Proxy Agreement, Option Agreement and the Business Cooperation Agreement, and all contractual obligations of the Pledgor and Gridsum Holdco under this Agreement.
“Guaranteed Liabilities”	shall mean all direct, indirect and consequential losses and losses of foreseeable profits suffered by Pledgee due to any Breaching Event (as defined below) by the Pledgor and/or Gridsum Holdco, and all fees incurred by Pledgee for the enforcement of the Contractual Obligations of the Pledgor and/or Gridsum Holdco.
“Transaction Agreements”	shall mean collectively the Proxy Agreement, the Option Agreement, the Business Cooperation Agreement and this Agreement.
“Breaching Event”	shall mean any breach by either Pledgor of its Contract Obligations under the Transaction Agreements; any breach by Gridsum Holdco of its Contract Obligations under the Transaction Agreements.
“Pledged Property”	shall mean the equity interest in Gridsum Holdco which is legally owned by the Pledgor as of the effective date hereof and is to be pledged by the Pledgor to the Pledgee according to provisions hereof as security for performance of the Pledgor and Gridsum Holdco of their Contractual Obligations, and any increased capital contribution and equity interest described in Articles 2.6 and 2.7 hereof.
“PRC Law”	shall mean the then valid laws, administrative regulations, administrative rules, local regulations, judicial interpretations and other binding regulatory documents of PRC.

1.2The references to any PRC Law herein shall be deemed (i) to include any references to the amendments, changes, supplements and reenactments of such law, irrespective of whether they take effect before or after the formation of this Agreement; and (ii) to include any references to other decisions, notices or regulations enacted in accordance therewith or effective as a result thereof.

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1.3Unless otherwise stated in the context herein, all references to an Article, clause, item or paragraph shall refer to the relevant part of this Agreement.

Article 2 Equity Pledge

2.1Pledgor hereby agrees to pledge the Pledged Property, which it legally owns and has the right to dispose of, to Pledgee according to the provisions hereof as the security for the performance of the Contract Obligations and the repayment of the Guaranteed Liabilities. Gridsum Holdco hereby agrees that the Pledgor who legally hold equity interest in it to pledge the Pledged Property to the Pledgee according to the provisions hereof.

2.2Pledgor hereby covenants that he/she will be responsible for, recording the arrangement of the equity pledge hereunder (the “Equity Pledge”) on the shareholder register of Gridsum Holdco on the date hereof, and will do its best endeavor to make registration with registration authorities of industry and commerce where Gridsum Holdco registers. Gridsum Holdco covenants that it will do its best to cooperate with the Pledgor to complete the registration with authorities of industry and commerce under this Article.

2.3During the valid term of this Agreement, except for the willful misconduct or gross negligence of Pledgee which has direct cause and effect relationship with the reduction in value of the Pledged Property, Pledgee shall not be liable in any way to, nor shall Pledgor have any right to claim in any way or propose any demands on Pledgee, in respect of the said reduction in value of the Pledged Property.

2.4To the extent not violating provision of Article 2.3 above, in case of any possibility of obvious reduction in value of the Pledged Property which is sufficient to jeopardize Pledgee’s rights, Pledgee may at any time auction or sell off the Pledged Property on behalf of Pledgor, and negotiate with Pledgor to use the proceeds from such auction or sale-off as pre-repayment of the Guaranteed Liabilities, or may submit such proceeds to the local notary institution to keep where Pledgee are domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

2.5The Pledgee shall be deemed to have created the encumbrance of first order in priority on the Pledged Property, and in case of any Breaching Event, Pledgee shall have the right to dispose of the Pledged Property in the way set out in Article 4 hereof.

2.6Only upon prior consent by Pledgee, Pledgor may increase his/her capital contribution to Gridsum Holdco. Further capital contribution made by Pledgor in Gridsum Holdco shall also be part of the Pledged Property.

2.7Only upon prior consent by Pledgee, Pledgor may be able to receive dividends or share profits from the Pledged Property. The dividends or the profits received by Pledgor from the Pledged Property shall be deposited into a bank account designated by Pledgee to be under the supervision of Pledgee and used as the Pledged Property to repay in priority the Guaranteed Liabilities.

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Article 3 Release of Pledge

In respect of equity interest of Gridsum Holdco, upon full and complete performance by Pledgor of all of his/her Contract Obligations and upon the full repayment by Pledgor of all the Guaranteed Liabilities (if any), the Pledgee shall, at the request of Pledgor, release the pledge created on Gridsum Holdco under this Agreement, and shall cooperate with Pledgor to go through the formalities to cancel the record of the Equity Pledge in the shareholder register of Gridsum Holdco; in case of the Equity Pledge having been recorded at the registration department of Administration of Industry and Commerce where Gridsum Holdco registers, the relevant Parties shall cooperate with each other to go through the formalities to cancel such record of the Equity Pledge. The reasonable fees incurred in connection with such release to be borne by Pledgee.

Article 4 Disposal of the Pledged Property

4.1Parties hereby agree that, in case of any Breaching Event, the Pledgee shall have the right to exercise, upon giving written notice to Pledgor, all of the remedial rights and powers enjoyable by it under PRC Law, Transaction Agreements and the terms hereof, including but not limited to being repaid in priority with proceeds from auctions or sale-offs of the Pledged Property. Pledgee shall not be liable for any loss as the result of their reasonable exercise of such rights and powers.

4.2Pledgee shall have the right to designate in writing its legal counsel or other agents to exercise on its behalf any and all rights and powers set out above, and neither Pledgor nor Gridsum Holdco shall not oppose thereto.

4.3The reasonable costs incurred by Pledgee in connection with exercise of any and all rights and powers set out above shall be borne by Pledgor, and Pledgee shall have the right to deduct such costs actually incurred from the proceeds acquired from the exercise of the rights and powers.

4.4The proceeds that Pledgee acquires from the exercise of their respective rights and powers shall be used in the priority order as follows:

Firstly, to pay any cost incurred in connection with the disposal of the Pledged Property and the exercise by Pledgee of its rights and powers (including remuneration paid to their respective legal counsels and agents);

Secondly, to pay any taxes and levies payable for the disposal of the Pledged Property; and

Thirdly, to repay Pledgee for the Guaranteed Liabilities.

In case of any balance after payment of the above amounts, Pledgee shall return it to Pledgor or other persons entitled thereto according to the relevant laws and rules or submit it to the local notary institution for keeping where Pledgee is domiciled (any fees incurred in relation thereto shall be borne by Pledgor).

4.5Pledgee shall have the option to exercise, simultaneously or in certain sequence, any of the remedies at breaching that it is entitled to in respect of the equity interest of Gridsum Holdco held by Pledgor. Pledgee shall not be obliged to exercise any other remedies at

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breaching before exercise of the right to the auctions or sale-offs of the Pledged Property hereunder. Pledgor or Gridsum Holdco shall not oppose to whether Pledgee exercises any part of the right to the pledge or the sequence of exercising the pledge interest.

Article 5 Continuity and No Waive

The Equity Pledge hereunder is a continuous guarantee, with its validity to continue until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities. Neither exemption or grace period granted by Pledgee to Pledgor in respect of his/her breach, nor delay by Pledgee in exercising any of its rights under the Transaction Agreements and this Agreement shall affect the rights of Pledgee under this Agreement, relevant PRC Law and the Transaction Agreements, the rights of Pledgee to demand at any time thereafter the strict performance of the Transaction Agreements and this Agreement by Pledgor or the rights Pledgee may be entitled to due to subsequent breach by Pledgor of the obligations under the Transaction Agreements and/or this Agreement.

Article 6 Pledgor’s Representations and Warranties

Pledgor hereby, in respect of himself/herself and Gridsum Holdco in which he/she holds equity interest, represents and warrants to Pledgee as follows:

6.1he/she has full and independent legal status and legal capacity to execute, deliver and perform this Agreement with due authorization, and is capable to act independently as a subject of legal actions.

6.2Gridsum Holdco in which the Pledgor holds equity interest is a limited liability company duly incorporated and validly existing under PRC Law, it has independent status as a legal person. It has full and independent legal status and capacity to execute, deliver and perform this Agreement and can independently be a subject of actions. It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as stipulated in this Agreement and to be executed by it. It also has full right and authorization to complete the transaction stipulated in this Agreement.

6.3All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the effectiveness hereof.

6.4All reports, documents and information concerning Pledgor and all matters as required by this Agreement which are provided by Pledgor to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects as of the time when such reports, documents and information are provided.

6.5At the time of the effectiveness of this Agreement, Pledgor is the sole legal owner of the Pledged Property, with no existing dispute whatsoever concerning the ownership of the Pledged Property. Pledgor has the right to dispose of the Pledged Property or any part thereof.

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6.6Except for the encumbrance set on the Pledged Property hereunder and the rights set under the Transaction Agreements, there is no other encumbrance or third party interests set on the Pledged Property.

6.7The Pledged Property is capable of being pledged or transferred according to the laws, and Pledgor has the full right and power to pledge the Pledged Property to Pledgee according to this Agreement.

6.8This Agreement constitutes the legal, valid and binding obligations on Pledgor when it is duly executed by Pledgor.

6.9Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder have already been handled or obtained, and will be fully effective during the valid term of this Agreement.

6.10The execution and performance by Pledgor of this Agreement are not in violation of or conflict with any laws applicable to him/her, or any agreement to which he/she is a party or which has binding effect on his/her assets, any court judgment, any arbitration award, or any administration authority decision.

6.11The pledge hereunder constitutes the encumbrance of first order in priority on the Pledged Property.

6.12All taxes and fees payable in connection with acquisition of the Pledged Property have already been paid in full amount by Pledgor.

6.13There is no pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Pledgor, or his/her property, or the Pledged Property, nor is there any pending or, to the knowledge of Pledgor, threatened litigation, legal process or arbitration by any government authority or any administration authority against Pledgor, or his/her property, or the Pledged Property, which is of material or detrimental effect on the economic status of Pledgor or his/her capability to perform the obligations hereunder and the Guaranteed Liabilities.

6.14Pledgor hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 7 Gridsum Holdco’s Representations and Warranties

Gridsum Holdco hereby represents and warrants to Pledgee as follows:

7.1Gridsum Holdco is a limited liability company duly incorporated and validly existing under PRC Law, with full capacity of disposition and has obtained due authorization to execute, deliver and perform this Agreement and can independently be a subject of

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actions.

7.2All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee before this Agreement comes into effect are true, correct and effective in all material aspects as of the execution hereof

7.3All reports, documents and information concerning Pledged Property and all matters as required by this Agreement which are provided by Gridsum Holdco to Pledgee after this Agreement comes into effect are true, correct and effective in all material aspects upon provision.

7.4This Agreement constitutes the legal, valid and binding obligations on Gridsum Holdco when it is duly executed by Gridsum Holdco

7.5It has full right and authorization to execute and deliver this Agreement and other documents relating to the transaction as contemplated hereunder, and has full right and authorization to consummate such transaction.

7.6There is no pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any court or any arbitral tribunal against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), nor is there any pending or, to the knowledge of Gridsum Holdco, threatened litigation, legal process or arbitration by any government authority or any administration authority against Gridsum Holdco, or its property (including but are not limited to the Pledged Property), which is of material or detrimental effect on the economic status of Gridsum Holdco or its capability to perform the obligations hereunder and the Guaranteed Liabilities.

7.7Gridsum Holdco hereby agrees to bear joint responsibilities to Pledgee in respect of the representations and Warranties made by Plegor according to Article 6.5, Article 6.6, Article 6.7, Article 6.9 and Article 6.11 hereof.

7.8Gridsum Holdco hereby warrants to Pledgee that the above representations and warranties will remain true, correct and effective at any time and under any circumstance before the Contractual Obligations are fully performed or the Guaranteed Liabilities are fully repaid, and will be fully complied with.

Article 8 Pledgor’s Covenants

Pledgor hereby covenants to Pledgee in respect of himself/herself and Gridsum Holdco of which he/she holds equity as follows:

8.1Without prior written consent by Pledgee, Pledgor shall not establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

8.2Without first giving written notice to Pledgee and having Pledgee’s prior written consent, Pledgor shall not transfer the Pledged Property, and any attempt by Pledgor to transfer the Pledged Property shall be null and void. The proceeds from transfer of the Pledged Property by Pledgor shall be used to repay to Pledgee in advance the

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Guaranteed Liabilities or deposit the same to the third party agreed with Pledgee.

8.3In case of any litigation, arbitration or other arbitration which may affect detrimentally the interest of Pledgor or Pledgee under the Transaction Agreements and hereunder or the Pledged Property, Pledgor undertakes to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

8.4Pledgor shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

8.5Pledgor guarantees that he/she shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

8.6In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Pledgor guarantees that he/she will take all necessary measures to realize such assignment.

Article 9 Gridsum Holdco’s Covenants

9.1Any consent, permission, waive or authorization by any third person, or any approval, permission or exemption by any government authority, or any registration or filing formalities (if required by laws) with any government authority to be handled or obtained in respect of the execution and performance hereof and the Equity Pledge hereunder will be cooperated to handle or obtain by Gridsum Holdco to its best and will be ensured to remain full effective during the valid term of this Agreement.

9.2Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to establish or permit to establish any new pledge or any other encumbrance on the Pledged Property.

9.3Without Pledgee’s prior written consent, Gridsum Holdco shall not cooperate to transfer or permit to transfer the Pledged Property.

9.4In case of any litigation, arbitration or other arbitration which may affect detrimentally Gridsum Holdco, the equity of Gridsum Holdco as the Pledged Property or the interest of Pledgee under the Transaction Agreements and hereunder, Gridsum Holdco covenants to notify Pledgee in writing as soon as possible and promptly and shall take, at the reasonable request of Pledgee, all necessary measures to ensure the pledge interest of Pledgee in the Pledged Property.

9.5Gridsum Holdco shall not carry on or permit any act or action which may affect detrimentally the interest of Pledgee under the Transaction Agreements and hereunder or the Pledged Property.

9.6Gridsum Holdco shall provide Pledgee with the financial statement of the last calendar

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season within the first month of each calendar season, including but are not limited to the balance sheet, the income statement and the statement of cash flow.

9.7Gridsum Holdco guarantees that it shall, at the reasonable request of Pledgee, take all necessary measures and execute all necessary documents (including but not limited to supplementary agreement hereof) in respect of ensuring the pledge interest of Pledgee in the Pledged Property and the exercise and realization of the rights thereof.

9.8In case of assignment of any Pledged Property as the result of the exercise of the right to the pledge hereunder, Gridsum Holdco guarantees that it will take all necessary measures to realize such assignment.

Article 10 Change of Circumstances

As supplement and subject to compliance with other terms of the Transaction Agreements and this Agreement, in case that at any time the promulgation or change of any PRC Law, regulations or rules, or change in interpretation or application of such laws, regulations and rules, or the change of the relevant registration procedures enables Pledgee to believe that it will be illegal or in conflict with such laws, regulations or rules to further maintain the effectiveness of this Agreement and/or dispose of the Pledged Property in the way provided herein, Pledgor and Gridsum Holdco shall, at the written direction of Pledgee and in accordance with the reasonable request of Pledgee, promptly take actions and/or execute any agreement or other document, in order to:

(a)keep this Agreement remain in effect;

(b)facilitate the disposal of the Pledged Property in the way provided herein; and/or

(c)maintain or realize the intention or the guarantee established hereunder.

Article 11 Term of Agreement

11.1This Agreement shall become effective when this Agreement is duly executed by Pledgee, Gridsum Holdco and the Pledgor.

11.2This Agreement shall have its valid term until the full performance of the Contract Obligations or the full repayment of the Guaranteed Liabilities.

Article 12 Notice

12.1Any notice, request, demand and other correspondences made as required by or in accordance with this Agreement shall be made in writing and delivered to the relevant party.

12.2The abovementioned notice or other correspondences shall be deemed to have been delivered when it is transmitted if transmitted by facsimile; it shall be deemed to have been delivered when it is delivered if received in person; it shall be deemed to have been delivered five (5) days after posting the same if posted by mail.

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Article 13 Miscellaneous

13.1Pledgee may, upon notice to Pledgor and Gridsum Holdco but not necessarily with Pledgor and Gridsum Holdco’s consent, assign Pledgee’s rights and/or obligations hereunder to any third party; provided that Pledgor or Gridsum Holdco can not, without Pledgee’s prior written consent, assign Pledgor’ rights, obligations and/or liabilities hereunder to any third party. Successors or permitted assignees (if any) of Pledgor and Gridsum Holdco shall continue to perform the obligations of Pledgor and Gridsum Holdco under this Agreement.

13.2This Agreement is written in both Chinese and English language in four (4) original copies, with each involved Party holding one (1) copy hereof with equal legal validity and one (1) copy for registration of Equity Pledge with industry and commerce administration; in case there is any conflict between the Chinese version and the English version, the Chinese version shall prevail.

13.3The formation, validity, execution, amendment, interpretation and termination of this Agreement shall be governed by PRC Law.

13.4Any disputes arising hereunder and in connection herewith shall be settled through consultations among the Parties, and if the Parties cannot reach an agreement regarding such disputes within thirty (30) days of their occurrence, such disputes shall be submitted to China International Economic and Trade Arbitration Commission for arbitration in Beijing in accordance with the arbitration rules of such Commission, and the arbitration award shall be final and binding on all disputing Parties.

13.5Any rights, powers and remedies empowered to any Party by any provisions herein shall not preclude any other rights, powers and remedies enjoyed by such Party in accordance with laws and other provisions under this Agreement, and the exercise of its rights, powers and remedies by a Party shall not preclude its exercise of its other rights, powers and remedies by such Party.

13.6Any failure or delay by a Party in exercising any of its rights, powers and remedies hereunder or in accordance with laws (the “Party’s Rights”) shall not lead to a waiver of such rights, and the waiver of any single or partial exercise of the Party’s Rights shall not preclude such Party from exercising such rights in any other way and exercising the remaining part of the Party’s Rights.

13.7The titles of the Articles contained herein shall be for reference only, and in no circumstances shall such titles be used in or affect the interpretation of the provisions hereof.

13.8Each provision contained herein shall be severable and independent from each of other provisions, and if at any time any one or more articles herein become invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions herein shall not be affected as a result thereof.

13.9This Agreement shall substitute any other documents on the same subject executed by relevant Parties hereof once duly executed.

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13.10Any amendments or supplements to this Agreement shall be made in writing. Except for assignment by Pledgee of its rights hereunder according to Article 13.1 of this Agreement, the amendments or supplements to this Agreement shall take effect only when properly signed by the Parties to this Agreement.

13.11This Agreement shall be binding on the legal successors of the Parties.

13.12All costs actually incurred in connection with the establishment of the Equity Pledge hereunder, including but not limited to stamp duties, any other taxes, all legal fees, etc shall be borne by the Pledgee.

[The remainder of this page is left blank]

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IN WITNESS HEREOF, the following Parties have caused this Equity Pledge Agreement to be executed as of the date first here above mentioned.

Dissector (Beijing) Technology Co. Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:
YU Guofa
Signature:	/s/Yu Guofa
Gridsum Holding (Beijing) Co., Ltd. (Company Seal)
Signature:	/s/Qi Guosheng
Name: Qi Guosheng
Title:

EX-10.9

Exhibit 10.9

[English Translation]

Cooperation Agreement on Operation of Research Center for e-Government

By and Between

State Information Center

and

Beijing Gridsum Technology Co., Ltd.

March 2012

This Cooperation Agreement (hereinafter referred to as this “Agreement”) was made and entered into on March 16, 2012 by and between the following parties:

Party A:

State Information Center, a public institutional entity established as approved by the State Council, whose main business is providing decision-making consultation, information contents service and information technology service, and whose office address is at [No. 58, Sanlihe Road, Xicheng District, Beijing] (hereinafter referred to as “Party A” or “SIC”);

Legal Representative: Ping Du

Title: Executive Deputy Director

Party B:

Beijing Gridsum Technology Co., Ltd., a liability limited company legally established and legally existing in accordance with the laws of the People’s Republic of China, whose registered address is at [8/F, Office Building, Jade Palace Hotel, No. 76, Zhichun Road, Haidian District, Beijing] (hereinafter referred to as “Party B” or “Gridsum”);

Legal Representative: Guosheng Qi

Title: Chairman and CEO

For the purpose of this Agreement, “Party A” and “Party B” are referred to collectively as the “Parties” and individually as the “Party”.

Whereas:

1.For the purpose of ensuring the normal operation and business expansion and development of the “Research Center for e-Government of the State Information Center” jointly invested in and established by SIC and Gridsum, the Parties will bring their respective advantages in resources, technologies and management to

full play, and propose the detailed operation and management methods for the Research Center for e-Government through joint consultations.

2.The Parties reach this Cooperation Agreement as follows based on the above-mentioned backgrounds.

Chapter 1 Business Entity Established for Operation of the Research Center for e-Government

I.Establishment of the Business Entity

Gridsum applies with the competent industrial and commercial authority to register its wholly-owned subsidiary, “GuoxinJunhe (Beijing) Technology Co., Ltd.” (hereinafter referred to as “GuoxinJunhe”), to take charge for the commercial operation, marketing services, product sale and finance management of the Research Center for e-Government. Gridsum and GuoxinJunhe shall diligently manage the incomes and expenditures arising out of this cooperation and establish specific accounts.

GuoxinJunhe is responsible for the implementation and performance of any and all commercial cooperation and project operation and sales arising out of this cooperation, including but not limited to:

1.selling the GWD software system to the Research Center for e-Government and its service targets;

2.providing one-time or long-term consultation services to the service targets;

3.rendering training programs and certification services to the users of the GWD products;

4.organizing large-scale seminars, setting up information networks and releasing or publishing journals and reports related to management of government websites.

II.Independent Operation

Beijing Gridsum Technology Co., Ltd. is the sole shareholder and decision maker of GuoxinJunhe. Except for Beijing Gridsum Technology Co., Ltd., the operation and management of GuoxinJunhe is not bound or controlled by any governmental institution, enterprise or individual.

GuoxinJunhe is established for the commercial operation related to this cooperation and has the right to conclude with the external service targets and perform the business contracts in the name of the Research Center for e-Government of the State Information Center (or its exclusive project implementation company) with the consent of the director of the Research Center for e-Government.

Chapter 2 Operation and Management of the Research Center for e-Government

I.Management Method

1.The Research Center for e-Government has one director and 3 to 4 deputy directors. The director is the person in charge of the Information Technology Research Department of SIC. One deputy director is the relevant person from the Information Technology Research Department of SIC, and the remaining 2 to 3 deputy directors are high-caliber professional talents employed by Gridsum. The persons in charge of various departments of the Research Center for e-Government shall be determined by the Parties through consultations. The staff members of various departments of the Research Center for e-Government shall be employed and recruited by Gridsum.

2.The director of the Research Center for e-Government is responsible to formulate the general development plans of the Research Center for e-Government, coordinate the cooperative relationship of the Parties and promote the various business stipulated in the framework agreement. The director of the Research Center for e-Government shall report the progress of various work to the legal representatives of both Parties. The important activities carried out by both Parties in the name of the Research Center for e-Government within the business scope

stipulated in the framework agreement, including concluding contracts, deploying software system, releasing consultation reports, organizing meetings, conducting promotion and marketing activities, training programs and publishing articles, shall be approved by both the director of the Research Center for e-Government and the legal representative of GuoxinJunhe.

3.The Research Center for e-Government shall have independent office premise, the exact location of which shall be determined by the Parties through negotiations.

II.Organization Setup

The Research Center for e-Government has five departments, namely Comprehensive Department, Experimentation Department, Consultation Department, Training Department and Cooperation and Exchange Department, and one expert commission. The director of the expert commission is to be appointed by SIC, and the secretary office of the expert commission is to be set up in the Cooperation and Exchange Department of the Research Center for e-Government. The organization setup of the Research Center for e-Government may be properly adjusted based on the needs of business development and the exact adjustment method is to be determined by the Parties through negotiations.

III.Daily Operation Capital

The daily operation capital of the Research Center for e-Government is to be provided by GuoxinJunhe, mainly including the specific research fee, technology support fee, office lease fee, daily office expenses, personnel cost and management cost. Such fees will be used mainly for the following purposes:

1.GuoxinJunhe provides the specific research funding of RMB 600,000 to the Research Center for e-Government in 2012. From then on the specific research funding will be properly increased based on the needs of the research tasks in each

year, the exact amount of which shall be determined by the Parties through negotiations. From 2012, such research funding shall be paid to the Information Technology Department of SIC by four installments on a quarterly basis in each year.

2.GuoxinJunhe provides fees for the technology support services of the External Website Office and the Certification Office of SIC each year. The exact fee rate shall be determined by the Parties through negotiations;

3.The fee to lease the office premise;

4.The fee for the development, deployment and technology support of the GWD system;

5.The daily office expenses, personnel costs, management costs, market expansion and other various investment of the Research Center for e-Government.

IV.Raising the Development Fund

GuoxinJunhe agrees to provide the development fund to SIC each year based on the needs of business development from 2013 to the expiry of the term hereof for the purpose of strengthening and expanding the researches, training programs, technology reforms and other tasks beneficial for the further cooperation between the Parties. GuoxinJunhe will pay 35% of the audited net profit of the previous year in the next year as the development fund for the Research Center for e-Government. The first payment will be made in 2014, the amount of which is 35% of the audited net profit of 2013.

The taxes on the above-mentioned daily operation capital, reimbursement, development fund and other various expenses shall be paid by SIC, and SIC shall provide the party paying such fees with the receipt (accounting) voucher recognized by the competent state taxation authority and reviewed and recognized by the certified accountant.

This Cooperation Agreement shall be executed and take effect from the first date mentioned at the beginning of this Agreement. Unless this Agreement is terminated during its term in accordance with the provisions hereof or by the Parties as otherwise agreed, the term of this Cooperation Agreement is [6] years.

Before the expiry of this Cooperation Agreement, this Agreement may be extended after the Parties confirm the same in writing through negotiations.

This Agreement is executed in four counterparts. Each Party holds two counterparts. All counterparts shall be equally authentic.

[REMAINDER OF THIS PAGE IS LEFT BLANK INTENTIONALLY, SIGNATURE PAGE FOLLOWS]

Party A: State Information Center
(Stamp)
Signed by Legal Representative:	/s/Ping Du
Date: March 16, 2012
Party B: Beijing Gridsum Technology Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Guosheng Qi
Date: March 16, 2012

EX-10.10

Exhibit 10.10

[English Translation]

Framework Agreement

on

Joint Establishment of Beijing Guoxin Wangyan Technology Co., Ltd.

by and among

Beijing Guoxin Xinchuang Investment Co., Ltd.

and

Beijing Gridsum Technology Co., Ltd.

and

Guoxinjunhe (Beijing) Technology Co., Ltd.

June 2015

This Framework Agreement (hereinafter referred to as this “Agreement”) is made and entered into as of June   , 2015 by and among:

Party A:

Beijing Guoxin Xinchuang Investment Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, an enterprise wholly owned by the State Information Center and carrying out investment and financing activities related to new technologies and new products in the field of information technology for and on behalf of the State Information Center, with its registered address at Room 201, No. 58, Sanlihe Road, Xicheng District, Beijing (hereinafter referred to as “Party A” or “Xinchuang”);

Legal Representative: Ping Du

Title: Chairman

Party B:

Beijing Gridsum Technology Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, a wholly-owned subsidiary of Gridsum Holding (Beijing) Co., Ltd., with its registered address at 8/F, Cuigong Fandian Xiezilou (Jade Palace Hotel Office Building), No. 76, Zhichun Road, Haidian District, Beijing (hereinafter referred to as “Party B” or “Beijing Gridsum”)

Legal Representative: Guosheng Qi

Title: Chairman and Chief Executive Officer

Party C:

Guoxinjunhe (Beijing) Technology Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, a wholly-owned subsidiary of Gridsum Holding (Beijing) Co., Ltd. with its registered address at 10/F, Cuigong Fandian Xiezilou (Jade Palace Hotel Office

Building), No. 76, Zhichun Road, Haidian District, Beijing (hereinafter referred to as “Party C” or “Guoxinjunhe”)

Legal Representative: Yang Xu

Title: General Manager

For the purpose of this Agreement, Party A, Party B and Party C are collectively referred to as the “Parties” and individually as a “Party “.

1. For the purpose of promoting the construction of government websites and the sustainable and healthy development of e-governmental affairs, Beijing Guoxin Xinchuang Investment Co., Ltd. (representing the State Information Center), Beijing Gridsum Technology Co., Ltd. and Guoxinjunhe (Beijing) Technology Co., Ltd. intend to jointly establish an entity to research and explore ways to optimize the work efficiency of the government websites and improve the ability of governmental departments in public services. The Parties intend to integrate the existing resources and fully utilize the advanced technology of Beijing Gridsum Technology Co., Ltd. in the relevant fields and the consultation teams of Guoxinjunhe (Beijing) Technology Co., Ltd., give full play to the advantages of the State Information Center in brands and network platforms and cooperate with each other closely.

2. Based on the above background, the Parties reach this Framework Agreement as follows:

Chapter 1 Definitions

I.Beijing Guoxin Xinchuang Investment Co., Ltd. or Xinchuang: a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China.

II.Beijing Gridsum Technology Co., Ltd. or Beijing Gridsum: a limited liability

company legally incorporated and duly existing in accordance with laws of the People’s Republic of China.

III.Guoxinjunhe (Beijing) Technology Co., Ltd. or Guoxinjunhe: a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China.

IV.Beijing Guoxin Wangyan Technology Co., Ltd: hereinafter referred to as “Guoxin Wangyan”, a limited liability company jointly established by Beijing Guoxin Xinchuang Investment Co., Ltd., Beijing Gridsum Technology Co., Ltd. and Guoxinjunhe (Beijing) Technology Co., Ltd. for the purpose of carrying out the cooperation hereunder. Guoxin Wangyan is the only entity supporting the commercial operation of the Research Center for e-Government of the State Information Center and aimed to provide consultation and relevant product services for optimization of government websites to governmental departments at various levels with a view to improving the service capability of government websites and promoting the healthy development of government websites.

V.The government website intelligent analysis system (GWD): i.e. e-Gov Web Dissector, is a government website intelligent analysis software, or system established thereon, researched and developed by Beijing Gridsum Technology Co., Ltd. and the intellectual property right to the existing version and future upgraded versions of the software or system is completely and exclusively owned by Beijing Gridsum Technology Co., Ltd. For the purpose of this Agreement, GWD software includes the original software and the legally authorized copies thereof.

Chapter 2 Joint Investment in and Establishment of Guoxin Wangyan

I.As agreed by the Parties through negotiations, Xinchuang (holding 20% equity), Beijing Gridsum (holding 40% equity) and Guoxinjunhe (holding 40% equity) will jointly sponsor and integrate relevant resources to jointly establish “Beijing

Guoxin Wangyan Technology Co., Ltd.” (interim name and subject to approval by the administration for industry and commerce, hereinafter referred to as “Guoxin Wangyan”). The registered capital is RMB 2,000,000 which is contributed in cash by the Parties in proportion to their respective equity.

II.Approval or decision on the joint establishment of Guoxin Wangyan: As the independent civil entities legally existing under the Chinese laws, Xinchuang, Beijing Gridsum and Guoxinjunhe shall respectively go through all necessary internal examination and approval or decision-making formalities regarding the joint establishment of an operation entity. The relevant approval or decision documents will become the necessary appendices attached hereto.

III.Guoxin Wangyan is the limited liability company jointly sponsored and established by the Parties. Guoxin Xinchuang fulfills the obligations of a contributor for and on behalf of the State Information Center and the State Information Center will instruct the Research Center for e-Government to carry out industrial publicity and promotion campaign, organize relevant researches and coordinate the relevant state resources and the relations with the competent governmental authorities; Beijing Gridsum is responsible for providing technology R&D resources; and Guoxinjunhe is responsible for providing sales, consultation, product design and other non-R&D resources in the company jointly established by the Parties.

IV.Scope of Cooperation

The targets of the business jointly carried out by the Parties will be all government departments and the main business is providing consultation optimization, data analysis and product services for the various websites of the governments at various levels.

V.Ownership of R&D Results

The intellectual property rights to the relevant (products) versions of GWD system and other government website analysis systems shall be exclusively

owned by Beijing Gridsum (i.e., the intellectual property rights to all the software system, system upgrades and other versions, the invested in and developed by Beijing Gridsum in relation to the cooperation among the Parties shall be exclusively owned by Beijing Gridsum); and the intellectual property rights to such materials as consultation reports and training materials arising out of the cooperation among the Parties shall belong to Guoxin Wangyan.

VI.Agreements on Providing Necessary Support to Relevant Cooperation Matters under this Framework Agreement

The Parties agree that this Agreement is an exclusive cooperation agreement and Xinchuang, Beijing Gridsum and Guoxinjunhe are entitled to the exclusive and sole right to the relevant cooperative matters agreed herein. It is the precondition to realize the fundamental objectives of this Agreement to maintain the exclusive and sole nature of the contents hereof and completely perform the following obligations: the GWD system of Beijing Gridsum and the data collected by the system will only be placed in the data center designated by the Research Center for e-Government of the State Information Center; the cooperation between Guoxinjunhe and Xinchuang in the business of government website optimization consultation and website data analysis is sole (and exclusive), and Xinchuang, Beijing Gridsum or Guoxinjunhe shall not independently carry out any business agreed herein in the government market without the consent of the other two parties in the cooperation.

VII.Confidentiality

The information arising out of the cooperation among the Parties on business information, technology plans, consultation reports, agreements, contents of agreements and matters referred herein is confidential information, which the Parties shall keep confidential. None of the Parties shall provide such confidential information to any third party without unanimous consent of the Parties through negotiations and the Parties shall conclude a confidentiality agreement as the case

may require.

Chapter 3 Miscellaneous

I.Disputes Resolution

The execution, validity, interpretation, implementation, amendment, termination and disputes resolution of this Agreement shall be governed by the laws of China.

Any and all the disputes arising out of the interpretation and implementation of this Agreement shall at first be settled by the Parties through friendly negotiations. Where the dispute cannot be settled within 30 days after one Party sends out the writing notice requesting to settle a dispute through negotiation to the other Parties, any of the Parties may submit the dispute in question to China International Economic and Trade Arbitration Commission for arbitration in accordance with the Commission’s arbitration rules. The arbitration shall be conducted in Chinese in Beijing. The arbitration award shall be final and binding upon all the Parties.

II.Effectiveness and Term of Validity

This Agreement will be signed on the date shown at the beginning of this Agreement and take effect simultaneously.

The operation period of Guoxin Wangyan is 10 years from the date when the Business License for Enterprise Legal Person of the Company is issued. If so proposed by any of the Parties and unanimously passed by the shareholders meeting, the Company may apply for extending its operation period with the local authority six months before the expiry of its operation period.

This Agreement shall remain in effect during the existence period of Guoxin Wangyan.

III.Suspension or Termination of Cooperation

None of the Parties may terminate this Agreement during its term without unanimous agreement by the Parties through negotiations except for the gross negligence or fraud on the part of any other Party.

The rights and obligations of the Parties in relation to intellectual property rights, liabilities for breach of the Agreement and confidentiality shall survive the termination of this Agreement.

IV.Settlement of Disputes between this Agreement and other Relevant Agreements

In case of any dispute between this Agreement and any other relevant agreement after this Agreement takes effect, this Agreement shall prevail.

V.Assignment

None of the Parties shall assign any right and obligation hereunder to any third party without the prior written consent of the Parties.

VI.Severability

Where any one or several provisions hereof are determined to be invalid, illegal or unenforceable in any aspect in accordance with any law or regulation, the validity, legitimacy or enforceability of the other provisions hereof shall not be so affected or impaired in any way. The Parties shall try to replace such invalid, illegal or unenforceable provisions with the valid provisions having the economic effects most similar to those of the invalid, illegal or unenforceable provisions to the largest extent permitted by laws and expected by the Parties through negotiations in good faith.

VII.Amendment and Supplements

The Parties shall conclude a separate written supplementary agreement regarding the operation and management of Guoxin Wangyan, which shall constitute an integral part hereof and have the same legal force and effect as this Agreement.

This Agreement is made in six copies, each Party holding two copies. All the copies are equally valid.

(NO TEXT BELOW. THE FOLLOWING IS THE SIGNATURE PAGE.)

Party A: Beijing Guoxin Xinchuang Investment Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/Ping Du
Date: June 25, 2015
Party B: Beijing Gridsum Technology Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Guosheng Qi
Date: June 19, 2015
Party C: Guoxinjunhe (Beijing) Technology Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Yang Xu
Date: June 19, 2015

EX-10.11

Exhibit 10.11

[English Translation]

Collaboration Agreement

on

Operation of Beijing Guoxin Wangyan Technology Co., Ltd.

by and among

Beijing Guoxin Xinchuang Investment Co., Ltd.

and

Beijing Gridsum Technology Co., Ltd.

and

Guoxinjunhe (Beijing) Technology Co., Ltd.

June 2015

This Operation Agreement (hereinafter referred to as “this Agreement”) is made and entered into as of June   , 2015 by and among:

Party A:

Beijing Guoxin Xinchuang Investment Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, an enterprise wholly owned by the State Information Center and carrying out investment and financing activities related to new technologies and new products in the field of information technology for and on behalf of the State Information Center with its registered address at Room 201, No. 58, Sanlihe Road, Xicheng District, Beijing (hereinafter referred to as “Party A” or “Xinchuang”);

Legal Representative: Ping Du

Title: Chairman

Party B:

Beijing Gridsum Technology Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, a wholly-owned subsidiary of Gridsum Holding (Beijing) Co., Ltd. with its registered address at 8/F, Cuigong Fandian Xiezilou (Jade Palace Hotel Office Building), No. 76, Zhichun Road, Haidian District, Beijing (hereinafter referred to as “Party B” or “Beijing Gridsum”)

Legal Representative: Guosheng Qi

Title: Chairman and Chief Executive Officer

Party C:

Guoxinjunhe (Beijing) Technology Co., Ltd., a limited liability company legally incorporated and duly existing in accordance with laws of the People’s Republic of China, a wholly-owned subsidiary of Beijing Gridsum Holding (Beijing) Co., Ltd. with its registered address at 10/F, Cuigong Fandian Xiezilou (Jade Palace Hotel

Office Building), No. 76, Zhichun Road, Haidian District, Beijing (hereinafter referred to as “Party C” or “Guoxinjunhe”)

Legal Representative: Yang Xu

Title: General Manager

For the purpose of this Agreement, Party A, Party B and Party C are collectively referred to as the “Parties” and individually as a “Party”. Whereas:

1. For the purpose of ensuring the normal operation and business expansion of “Beijing Guoxin Wangyan Technology Co., Ltd.” jointly invested in and established by Guoxin Xinchuang, Beijing Gridsum and Guoxinjunhe, the Parties will fully exert their respective advantages in resources, technology and management and propose the method to operate and manage the Company through negotiations.

2. Based on the above background, the Parties reach this Collaboration Agreement as follows:

Chapter 1 Business Entity Established for Operating the Research Center

I.Establishment of the Business Entity

Guoxin Xinchuang, Beijing Gridsum and Guoxinjunhe will jointly apply with the administration for industry and commerce to register their subsidiary, “Beijing Guoxin Wangyan Technology Co., Ltd.” (hereinafter referred to as “Guoxin Wangyan”) to take charge of business operation, market services, product sale and financial management of the Research Center for e-Government of the State Information Center (hereinafter referred to as the “Research Center”). Guoxin Wangyan shall diligently manage the financial receipts and expenditures arising out of the cooperation and establish the special accounts.

Guoxin Wangyan is responsible for the implementation and performance of any

and all the relevant business cooperation and project operation and sales arising out of the operation of the Research Center, including but not limited to:

1. to sell the government web dissector (GWD) software, government website group integrated management platform and other systems researched and developed for government websites to the Research Center and its clients;

2. to provide one-time or long-term website optimization consultation services to the clients;

3. to provide training and certification to the users of GWD products;

4. to organize large seminars in the field of government websites and release or publish journals and reports on the management of government websites.

II.Independence of Operation

The shareholders and decision makers of Guoxin Wangyan are Beijing Guoxin Xinchuang Investment Co., Ltd. (representing the State Information Center), Beijing Gridsum Technology Co., Ltd. and Guoxinjunhe (Beijing) Technology Co., Ltd.. The operation and management of Guoxin Wangyan will not be bound and controlled by any other government agency, enterprise or individual.

Guoxin Wangyan is established for the business operation related to this cooperation and has the right to execute and perform business contracts with its clients in the name of the Research Center for e-Government of the State Information Center (or its sole designated project implementation company).

Chapter 2 Operation and Management of the Research Center

I.Management Method

1. The permanent organizations of Guoxin Wangyan include the board of directors and the operation and management department. The board of directors will hold two meetings every year at fixed dates, one in the first half of the year

and another in the second half of the year. The meetings will discuss and formulate the annual work plans proposed by the management department of the Company, summarize, supervise and examine the work rules, and discuss and find solutions to the major development issues confronting the Company. Any director who cannot attend the meetings of the board of directors shall specify the reasons for his/her absence and apply for leaves of absence. The board of directors has one chairman who shall be Ping Du. The other two directors shall be appointed by Beijing Gridsum and Guoxinjunhe.

2. The Company has an operation and management organization which has 1 general manager who shall be Yang Xu. The general manager reports to the board of directors and performs the following duties:

(1) presiding over the daily operation and management tasks of the Company and organize the implementation of the resolutions of the board of directors;

(2) organizing the implementation of the annual operation plans and schemes of the Company;

(3) proposing the internal management organization structure plans of the Company;

(4) drafting the basic management rules of the Company;

(5) proposing the employment or dismissal of the deputy general manager of the Company; employing or dismissing the management personnel other than those to be nominated by the chairman and employed or dismissed by the board of directors;

(6) performing other duties granted in the articles of association or by the board of directors.

2. The Parties shall carry out the important activities (e.g. concluding contracts, deploying software and system, issuing consultation reports, organizing meetings, marketing and promotion, training and publishing) within the business scope

stipulated in the Framework Agreement in the name of Guoxin Wangyan or the Research Center with the unanimous approval by the persons in charge of the Parties.

3. Guoxin Wangyan shall have independent human resources, finance and office premises, matters regarding which shall be discussed among the Parties before final decisions are made.

II.Organizational Setup

The operation and management organization of Guoxin Wangyan consists of the general department, the human resources department, the finance department and the legal affairs department.

The organizational setup may be adjusted based on the needs of its business development, which shall be determined by the Parties through negotiations.

III.Daily Working Capital

The daily working capital of Guoxin Wangyan mainly includes special research funds, technical support funds, office premise rent, daily office expenses, human resources cost, management cost and other expenses. These funds shall be used for the following purposes:

1. Providing the special research funds of RMB 800,000 to the State Information Center annually, to be paid out quarterly in four installments each year starting from 2015 for issues involving government network research and result promotion.

2. Making payments for the basic resources and support services to the State Information Center at the rates subject to negotiations;

3. Office premises rent;

4. Funds for the development, deployment and technical support of the GWD system and other products related to government websites;

5. Expenses for routine work in the office, human resources cost, management cost, market expansion and other expenses of the Research Center.

IV.Miscellaneous

This Agreement is made in six copies, each Party holding two copies. All the copies are equally valid.

This Agreement will take effect upon the establishment of Guoxin Wangyan, at which time the original agreement between the State Information Center and Beijing Gridsum Technology Co., Ltd. on the operation of the Research Center for e-Government shall be automatically revoked.

(NO TEXT BELOW. THE FOLLOWING IS THE SIGNATURE PAGE.)

Party A: Beijing Guoxin Xinchuang Investment Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Ping Du
Date: June 25, 2015
Party B: Beijing Gridsum Technology Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Guosheng Qi
Date: June 19, 2015
Party C: Guoxinjunhe (Beijing) Technology Co., Ltd.
(Stamp)
Signed by Legal Representative:	/s/ Yang Xu
Date: June 19, 2015

EX-21.1

Exhibit 21.1

List of Subsidiaries and Consolidated Affiliated Entities of the Registrant

Name of Subsidiary	Jurisdiction of Incorporation
Gridsum Holding (China) Limited	Hong Kong
Dissector (Beijing) Technology Co., Ltd.	PRC
Name of Consolidated Affiliated Entity	Jurisdiction of Incorporation
Gridsum Holding (Beijing) Co., Ltd.	PRC
Beijing Gridsum Technology Co., Ltd.	PRC
Beijing Moment Everlasting Ad Co., Ltd.	PRC
Guoxinjunhe (Beijing) Technology Co., Ltd.	PRC
Beijing Yunyang Ad Co., Ltd.	PRC
Beijing Guoxinwangyan Technology Co., Ltd.	PRC
Beijing Gridsum Yizhun Technology Co., Ltd.	PRC

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the use in this Registration Statement on Form F-1 of Gridsum Holding Inc. of our report dated March 9, 2016, except for note 2 (a) and note (d), which is as of August 19, 2016 relating to the financial statements, which appears in such Registration Statement.  We also consent to the reference to us under the heading “Experts” in such Registration Statement.

/s/ PricewaterhouseCoopers Zhong Tian LLP

Beijing, the People’s Republic of China

EX-99.1

Exhibit 99.1

GRIDSUM HOLDING INC.

CODE OF BUSINESS CONDUCT AND ETHICS

(As adopted on February 2, 2016,
effective upon completion of the Company’s initial public offering)

I.INTRODUCTION

Gridsum Holding Inc. (collectively with its subsidiaries and consolidated affiliated entities, “Company”) has adopted this Code of Business Conduct and Ethics (“Code”) to set high standards of ethical business conduct and provide guidance applicable to every employee (including every officer) and director of the Company.

A.Scope

This Code shall apply to all of the Company’s employees and directors.  The Company may modify or update these more specific policies and procedures from time to time and adopt new policies and procedures in the future.

Nothing in this Code is intended to alter the existing legal rights and obligations of the Company or any of its employees or directors, including “at will” employment arrangements or the terms of any employment-related agreements.

B.Responsibility

It is every employee’s and director’s responsibility to read and understand this Code, and to use it as a guide to the performance of his or her responsibilities for the Company.  This Code cannot address every ethical issue or circumstance that may arise, so, in complying with the letter and spirit of this Code, employees and directors must apply common sense, together with high personal standards of ethics, honesty and accountability, in making business decisions where this Code has no specific guideline.  In complying with this Code, employees and directors should also consider the conduct of their family members and others who live in their household.

The Company expects all of its directors, executives, managers and other supervisory personnel to help foster a sense of commitment to this Code among all of its employees, and to foster a culture of fairness, honesty and accountability within the Company.  The Company also expects such personnel to ensure that Company’s agents and contractors conform to Code standards when working on the Company’s behalf.

C.Compliance

Any employee that needs help understanding this Code or how it applies to conduct in any given situation should contact his or her supervisor or the Company’s Compliance Officer.  The Company has designated the Company’s Chief Financial Officer as its Compliance Officer (“Compliance Officer”).  In the event of the Chief Financial Officer’s unavailability, the Company’s Chief Executive Officer shall be authorized to serve as the Compliance Officer in the interim.

Employees should also be alert to possible violations of this Code by others and should report suspected violations, without fear of any form of retaliation, as described in Section XIII.

II.APPLICABLE DOCUMENTS

This Code is intended to supplement and not to replace existing Company policies and procedures, as they may exist from time to time.

III.GENERAL LEGAL AND ETHICAL OBLIGATIONS

The Company’s success depends upon each employee and director performing his or her Company duties in compliance with applicable laws and in cooperation with governmental authorities.  It is essential that employees and directors know and understand the legal and regulatory requirements that apply to the Company’s business and to their specific area of responsibility.  While employees and directors are not expected to have complete mastery of these laws, rules and regulations, they are expected to be able to recognize situations that require them to consult with others to determine the appropriate course of action.  To address questions in the area of legal compliance, employees should approach their supervisor or the Compliance Officer immediately.

Legal compliance is only a part of the Company’s ethical responsibility, however, and should be viewed as the minimum acceptable standard of conduct.  The Company strives to act with the utmost integrity, not just in its most important corporate decisions, but also in the actions taken every day by its employees and directors.  Ethical conduct is a high ideal, but often just means exercising common sense and sound judgment.  Acting ethically will help the Company become a better company, a better partner for other companies, and a better corporate citizen.

Employees and directors are expected to comply with all applicable laws wherever they travel on Company business, including laws prohibiting bribery, corruption or the conduct of business with specified individuals, companies or countries.  Employees and directors who have questions as to whether an activity is restricted or prohibited should contact the Compliance Officer before taking any action.

IV.CONFLICTS OF INTEREST

A conflict of interest occurs when an individual’s private interest (or the interest of a member of his or her family) interferes, or even appears to interfere, with the interests of the Company as a whole.  A conflict of interest can arise when an employee or director (or a member of his or her family) takes actions or has interests that may make it difficult to perform his or her work for the Company objectively and effectively.  Conflicts of interest also arise when an employee or director (or a member of his or her family) receives improper personal benefits as a result of his or her position in the Company.

Every employee and director must avoid situations where loyalties may be divided between the Company’s interests and the employee’s or director’s own interests.  Employees and directors should also seek to avoid the appearance of a conflict of interest.  If an employee is considering engaging in a transaction or activity that may present a conflict of interest or the appearance of a conflict of interest, the employee should disclose the matter to the Compliance Officer, so that, if appropriate, the Compliance Officer may disseminate such

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information and/or obtain approvals before the employee engages in such transaction or activity.

In evaluating whether an actual or contemplated activity may involve a conflict of interest, an employee or director should consider:

·whether the activity would appear improper to an outsider;

·whether the activity could interfere with the job performance or morale of a Company employee;

·whether the employee or director involved in the activity has access to confidential Company information or influence over significant Company resources or decisions;

·the potential impact of the activity on the Company’s business relationships, including relationships with suppliers, competitors, partners, employees and anyone else with whom he or she has contact in the course of performing his or her job; and

·the extent to which the activity could benefit the employee or director or his or her relatives, directly or indirectly.

A few examples of activities that could involve conflicts of interests include:

·Aiding the Company’s competitors.  Aiding the Company’s competitors can include, without limitation, passing confidential Company information to a competitor or accepting payments or other benefits from a competitor.

·Participating in any company that does business with the Company or seeks to do business with the Company.  Employment by or service on the board of a supplier or partner is generally discouraged, and employees and directors must seek approval in advance if they plan to have such a relationship.

·Owning a significant financial interest in a competitor or a company that does business with the Company or seeks to do business with the Company.  In evaluating such interests for conflicts, both direct and indirect interests that an employee or director may have should be considered, along with factors such as the following:

·the size and nature of the interest;

·the nature of the Company’s relationship with the other entity;

·whether the employee or director has access to confidential Company information; and

·whether the employee or director has an ability to influence Company decisions that would affect the other entity.

Any employee or director who has or wishes to acquire a significant financial interest in a competitor, or in a supplier or partner with which he or she has direct

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business dealings (or approval responsibilities), must consult with the Compliance Officer.  Similarly, any employee or director who experiences a change of position or seniority that results in direct business dealings with a supplier, competitor or partner in which he or she already has a significant financial interest must consult with the Compliance Officer.

·Having authority on behalf of the Company over a co-worker who is also a family member, or transacting business on behalf of the Company with a family member.  Any employee who may be involved in such a situation should consult with his or her supervisor or the Compliance Officer to assess the situation and an appropriate resolution.

·Soliciting or accepting payments, gifts, loans, favors or preferential treatment from any person or entity that does or seeks to do business with the Company.  See Section IV.A. for further discussion of the issues involved in this type of conflict.

·Taking personal advantage of corporate opportunities.  See Section IV.B. for further discussion of the issues involved in this type of conflict.

Employees must avoid these situations (and others like them), whenever their loyalty to the Company could be compromised.  Employees who believe they are involved in a potential conflict of interest are expected to discuss it with the Compliance Officer.

Like employees, directors should also seek to avoid conflicts of interest with their obligations to the Company.  To that end, any director who confronts a conflict of interest in connection with a decision to be made by the Board of Directors, or otherwise, should take such steps as are necessary to avoid the conflict of interest, including notifying the Chairperson of the Board of Directors and Chief Executive Officer and, if appropriate, recusing himself or herself from discussions by the Board of Directors which could be perceived to create such a conflict.

A.Gifts and Entertainment

Building strong relationships with suppliers and partners is essential to the Company’s business.  Socializing with suppliers and partners is an integral part of building those relationships.  However, good judgment should be exercised in providing or accepting business meals and entertainment or inexpensive gifts, so that all such conduct is consistent with customary and prudent business practices.

While individual circumstances differ, the overriding principle concerning gratuities is not to give or accept anything of value that could be perceived as creating an obligation on the part of the recipient (whether a Company employee, a supplier or a partner) to act other than in the best interests of his or her employer or otherwise to taint the objectivity of the individual’s involvement.  It is the responsibility of each employee to ensure that providing or accepting a gratuity is appropriate under the circumstances.

This principle applies to the Company’s transactions everywhere in the world, even if it conflicts with local custom.  Under some statutes, such as the United States Foreign Corrupt Practices Act, giving anything of value to a government official to obtain or retain business or favorable treatment is a criminal act subject to prosecution and conviction.

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B.Corporate Opportunities

Employees and directors may not compete with the Company or take personal advantage of business opportunities that the Company might want to pursue.  Employees and directors are prohibited from taking for themselves personally (or for the benefit of friends or family members) opportunities that are discovered through the use of Company assets, property, information or position.  Additionally, employees and directors may not use Company assets, property, information or position for personal gain (including gain of friends or family members) and may not compete with the Company.

Employees and directors who are interested in the use of the Company’s property or information, or in pursuing an opportunity that they discovered through their Company position, should consult with the Compliance Officer to determine an appropriate course of action.  Even opportunities that are acquired through independent sources may be questionable if they are related to the Company’s existing or proposed lines of business.  Employees and directors owe a duty to the Company to advance its legitimate business interests when opportunities arise.

C.Employee Loans

Loans to employees or directors or their family members by the Company, or guarantees of their loan obligations, could constitute an improper personal benefit to the recipients of such loans or guarantees.  Accordingly, Company loans and guarantees for executive officers and directors are expressly prohibited.  Any loans to employees require the prior approval of the Board of Directors.

D.Related Party Transactions

A related-party transaction includes any transaction, or series of similar transactions, since the beginning of the Company’s last fiscal year, or any currently proposed transaction or series of similar transactions, where: (i) the Company is a party, (ii) the amount involved exceeds US$120,000 in aggregate, and (iii) in which any of the following persons had or will have a direct or indirect material interest:  any person who is, or was at any time since the beginning of the Company’s last fiscal year, a director, director nominee or an executive officer; any holder of more than five percent of the Company’s then outstanding shares; or any member of the immediate family of such persons.  The Company will conduct a review of all related-party transactions for potential conflicts of interest situations.  For more information, see the Company’s Related Party Transactions Policy.

V.INSIDER TRADING

Every employee and director is prohibited from using “inside” or material nonpublic information about the Company, or about companies with which it does business, in connection with buying or selling the Company’s or such other companies’ securities, including “tipping” others who might make an investment decision on the basis of this information.  It is illegal, and it is a violation of this Code and other Company policies, to tip or to trade on inside information.  Employees or directors who have access to inside information are not permitted to use or share that inside information for stock trading purposes or for any other purpose except to conduct Company business.

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Employees must exercise the utmost care when in possession of material nonpublic information.  The Company’s Insider Trading Policy provides guidance on the sorts of information that might be nonpublic and material for these purposes, and guidelines on when and how employees and directors may purchase or sell shares of the Company or other Company securities.  The Company strongly encourages all employees and directors to review the Company’s Insider Trading Policy for additional information.

VI.COMPETITION AND FAIR DEALING

The Company strives to compete vigorously and to gain advantages over its competitors through superior business performance, not through unethical or illegal business practices.  Each employee and director must deal fairly with the Company’s suppliers, competitors, partners, employees and anyone else with whom he or she has contact in the course of performing his or her job.  No employee or director may take unfair advantage of anyone through manipulation, concealment, abuse or privileged information, misrepresentation of facts or any other unfair dealing practice.

A.Policies Specific to Procurement

Employees involved in procurement have a special responsibility to adhere to principles of fair competition in the purchase of products and services by selecting suppliers based exclusively on normal commercial considerations, such as quality, cost, availability, service and reputation, and not on the receipt of special favors.

B.Antitrust Laws

Antitrust laws are designed to protect customers and the competitive process.  These laws generally prohibit the Company from establishing:

·price fixing agreements or arrangements, including by interference, with competitors;

·arrangements with competitors to share pricing information or other competitive marketing information, or to allocate markets or customers;

·agreements with competitors or customers to boycott particular suppliers, customers or competitors; and

·a monopoly or attempted monopoly through anticompetitive conduct.

Noncompliance with the antitrust laws can have extremely negative consequences for the Company, including long and costly criminal or civil investigations and lawsuits, criminal charges against the company or responsible individuals and substantial fines or damages, and adverse publicity.  Understanding the requirements of antitrust and unfair competition laws of the jurisdictions where the Company does business can be difficult, so employees and directors are urged to seek assistance from the Compliance Officer whenever they have a question relating to these laws.

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VII.MAINTENANCE OF CORPORATE BOOKS, RECORDS AND ACCOUNTS; FINANCIAL INTEGRITY; PUBLIC REPORTING

The Company strives to maintain complete integrity of its records and public disclosure.  The Company’s corporate and business records, including all supporting entries to its books of account, must be completed honestly, accurately and intelligibly.  The Company’s records are important to investors and creditors.  The Company depends on its books, records and accounts accurately and fairly reflecting, in reasonable detail, its assets, liabilities, revenues, costs and expenses, as well as all transactions and changes in assets and liabilities.

To help ensure the integrity of its records and public disclosure, the Company requires that:

·no entry be made in the Company’s books and records that is intentionally false or misleading;

·transactions be supported by appropriate documentation;

·the terms of commercial transactions be reflected accurately in the documentation for those transactions and all such documentation be reflected accurately in the Company’s books and records;

·employees comply with the Company’s system of internal controls and be held accountable for their entries;

·any off-balance sheet arrangements of the Company be clearly and appropriately disclosed;

·no cash or other assets be maintained for any purpose in any unrecorded or “off-the-books” fund;

·assets and liabilities of the Company be recognized and stated in accordance with the Company’s standard practices and generally accepted accounting principles in the United States (“GAAP”); and

·records be retained or destroyed according to the Company’s records retention policy, if applicable.

The Company’s disclosure controls and procedures are designed to help ensure that the Company’s public disclosures are full, fair and accurate, that they fairly present its financial condition and results of operations, and that they are timely and understandable.  Employees who collect, provide or analyze information for or otherwise contribute in any way to preparing or verifying these reports should adhere to all disclosure controls and procedures and generally assist the Company in producing financial disclosures that contain all of the information about the Company that is required by law and would be important to enable investors to understand the Company’s business and its attendant risks.  In particular:

·no employee may take or authorize any action that would cause the Company’s financial records or financial disclosures to fail to comply with GAAP, the rules and regulations of the Securities and Exchange Commission or other applicable laws, rules and regulations;

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·all employees must cooperate fully with the Company’s finance department, as well as the Company’s independent public accountants and counsel, respond to their questions with candor and provide them with complete and accurate information to help ensure that the Company’s books and records, as well as its reports filed with the Securities and Exchange Commission, are accurate and complete; and

·no employee shall knowingly make (or cause or encourage any other person to make) any false or misleading statement in any of the Company’s reports filed with the Securities and Exchange Commission or any third party or knowingly omit (or cause or encourage any other person to omit) any information necessary to make the disclosure in any of such reports accurate in all material respects.

If any employee becomes aware that the Company’s public disclosures are not full, fair and accurate, or if any employee becomes aware of a transaction or development that he or she believes may require disclosure, he or she should report the matter immediately to the Compliance Officer.

VIII.RECORDS MANAGEMENT

The Compliance Officer (or his or her designee) has companywide responsibility for developing, administering and coordinating the record management program, and issuing retention guidelines for specific types of documents.  Records should be maintained to comply with applicable statutory, regulatory or contractual requirements, as well as those pursuant to prudent business practices.  Employees can contact the Compliance Officer for specific information on record retention.

IX.CONFIDENTIALITY

Confidential information includes all non-public information (regardless of its source) that might be of use to competitors, or harmful to the Company, its suppliers or its partners, if disclosed, including any proprietary information shared with the Company by its suppliers and partners, or information that has been acquired by an employee during the course of working for a former employer.  Company employees have an equal obligation to protect against the unauthorized disclosure or misuse of such third party confidential information.  Anyone who has had access to confidential Company information must keep it confidential at all times, both while working for the Company and after employment ends.

A.Sharing Information with Third Parties

Employees must not share the Company’s confidential information, or any confidential information of a supplier or partner, with anyone who has not been authorized to receive it, except when disclosure is authorized or legally mandated.  An employee’s unauthorized use or distribution of this information is extremely serious; it would violate the confidentiality agreement he or she entered into with the Company and could be illegal, resulting in civil liability or criminal penalties.

B.Precautions

Employees must take precautions to prevent unauthorized disclosure of confidential information.  Accordingly, employees should also take steps to ensure that business-related

8

paperwork and documents are produced, copied, faxed, filed, stored and discarded by means designed to minimize the risk that unauthorized persons might obtain access to confidential information.  Employees should not discuss sensitive matters or confidential information in public places.  Employees may not discuss the Company’s business in any Internet “chat room,” blog, social media site or application, or other online forum, regardless of whether they use their own name or a pseudonym, or otherwise post the Company’s information on the Internet.  When accessing Company emails and voicemails from personal computers and mobile devices, employees should take steps to ensure that third parties are unable to access or hear information regarding the Company.  All Company emails, voicemails and other communications are presumed confidential and should not be forwarded or otherwise disseminated outside of the Company, except where required for legitimate business purposes.

Employees are required to observe the provisions of any other specific policy regarding privacy and confidential information that the Company may adopt from time to time.

X.PROTECTION AND PROPER USE OF COMPANY ASSETS

All employees and directors are expected to protect the Company’s assets and ensure their efficient use for legitimate business purposes.  Theft, carelessness and waste have a direct impact on the Company’s profitability.  The Company’s property, such as computer equipment, buildings, furniture and furnishings, office supplies and products and inventories, should be used only for activities related to employment, although incidental personal use is permitted.  Personal use of Company cellular phones and other mobile devices is permitted, but employees must help ensure the security of the device, such as password protecting the device.  Employees should bear in mind that the Company retains the right to access, review, monitor and disclose any information transmitted, received or stored using the Company’s electronic equipment, with or without an employee’s or third party’s knowledge, consent or approval.  Employees must immediately report any misuse or suspected misuse of the Company’s assets to their supervisor or the Compliance Officer.

XI.MEDIA CONTACTS AND PUBLIC COMMUNICATIONS

It is the Company’s policy to disclose material information concerning the Company to the public only in accordance with its communications and disclosure guidelines and policies, in order to avoid inappropriate publicity and to ensure that all such information is communicated in a way that is reasonably designed to provide broad, non-exclusionary distribution of information to the public.  For more information, see the Company’s Corporate Communications Policy.

XII.CONDUCT OF SENIOR FINANCIAL PERSONNEL

The Company’s Finance Department has a special responsibility to promote integrity throughout the organization, with responsibilities to stakeholders both inside and outside of the Company.  As such, the Chief Executive Officer and senior finance department personnel must adhere to the following ethical principles and accept the obligation to foster a culture throughout the Company as a whole that ensures the accurate and timely reporting of the Company’s financial results and condition.

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Because of this special role, the Company requires that the Chief Executive Officer, Chief Financial Officer, Senior Director of Finance, Corporate Controller and any other persons performing similar functions (“Senior Financial Employees”) to:

·act with honesty and integrity and use due care and diligence in performing his or her responsibilities to the Company;

·avoid situations that represent actual or apparent conflicts of interest with his or her responsibilities to Company, and disclose promptly to the Audit Committee of the Board of Directors (“Audit Committee”), any transaction or personal or professional relationship that reasonably could be expected to give rise to such an actual or apparent conflict.  Without limiting the foregoing, and for the sake of avoiding an implication of impropriety, Senior Financial Employees shall not:

·accept any material gift or other gratuitous benefit from a supplier or vendor of products or services, including professional services, to the Company (this prohibition is not intended to preclude ordinary course entertainment or similar social events);

·except with the approval of the disinterested members of the Board of Directors, directly invest in any privately-held company that is a partner or supplier of the Company where the Senior Financial Employee, either directly or through people in his or her chain of command, has responsibility or ability to affect or implement the Company’s relationship with the other company; or

·maintain more than a passive investment of greater than 1% of the outstanding shares of a public company that is a supplier or partner of the Company;

·provide constituents with information that is accurate, complete, objective, relevant, timely and understandable, including information for inclusion in the Company’s submissions to governmental agencies or in public statements;

·comply with applicable laws, rules, and regulations of federal, state and local governments, and of any applicable public or private regulatory and listing authorities; and

·achieve responsible use of and control over all assets and resources entrusted to each Senior Financial Employee.

XIII.COMPLIANCE STANDARDS AND PROCEDURES

A.Compliance Resources

The Company has an obligation to promote ethical behavior.  Every employee is encouraged to talk to his or her supervisor, managers and other appropriate personnel when in doubt about the application of any provision of this Code.

In addition to fielding questions with respect to interpretation or potential violations of this Code, the Compliance Officer is responsible for:

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·investigating possible violations of this Code;

·reviewing this Code with new employees;

·conducting periodic training sessions to refresh employees’ familiarity with this Code; and

·otherwise promoting an atmosphere of responsible and ethical conduct.

The most immediate resource available to employees for matters related to this Code is their supervisor.  The supervisor may have the information requested or may be able to refer the question to another appropriate source.  There may, however, be times when employees prefer not to go to their supervisor.  In these instances, employees should feel free to discuss their concerns with the Compliance Officer.  If an employee is uncomfortable speaking with the Compliance Officer because he or she works in that employee’s department or is one of his or her supervisors, the employee may contact the Chairperson of the Audit Committee.

B.Clarifying Questions and Concerns; Reporting Possible Violations

(a)Employee Reporting

If an employee becomes aware of or suspects that unethical or illegal conduct has occurred or is about to occur, the employee should discuss the matter promptly with his or her supervisor or the Compliance Officer, as discussed in Section XIII.A. above.  Even the appearance of impropriety could be very damaging to the Company.  Employees that are aware of a suspected or actual violation of Code standards by others have a responsibility to report it.

All information regarding suspected ethical violations or unlawful activity will be received on a confidential basis.  While complete confidentiality cannot be guaranteed, confidentiality will be maintained to the extent possible in conducting internal investigations and, where action is warranted, in carrying out disciplinary measures.  Employees are assured that they may report unethical conduct without fear of retribution.  The Company will not tolerate adverse actions being taken against an employee for reporting violations of law or the Company’s policies, or for participating in internal investigations.  See the Company’s Whistleblower and Complaint Policy.

(b)Compliance Officer Investigation

Supervisors must promptly report any complaints or observations of Code violations to the Compliance Officer.  The Compliance Officer, or designee, will investigate all reported possible Code violations promptly and with the highest degree of confidentiality that is possible under the specific circumstances.  Employee cooperation in the investigation will be expected.  As needed, the Compliance Officer will consult with outside legal counsel, the human resources department, the Audit Committee and the full Board of Directors, if necessary.

(c)Response to Violations

If the investigation indicates that a violation of this Code may have occurred, the Company will take such action as it deems appropriate under the circumstances.  If Company

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determines that an employee is responsible for a Code violation, he or she will be subject to disciplinary action up to, and including, termination of employment and, in appropriate cases, civil action or referral for criminal prosecution.  Appropriate action may also be taken to deter any future Code violations.

C.Identification of Responsible Parties; Anonymous Reporting Procedures

Employees are responsible for promptly reporting any issue or concern that they believe in good faith may constitute a violation of this Code or any other Company policy.  Employees who wish to anonymously submit a concern or complaint regarding a possible violation of this Code should follow the procedures outlined in the Company’s Whistleblower and Complaint Policy.

XIV.WAIVERS

The Board of Directors (in the case of a violation involving a member of the Audit Committee), or the Audit Committee (in the case of a violation not involving any of its members), in its discretion, may waive any violation of this Code.  Any waiver for a director or an executive officer will be disclosed as required by applicable laws, rules and regulations.

XV.NO RIGHTS CREATED

This Code is a statement of fundamental principles, policies and procedures that govern the Company’s employees, officers and directors in the conduct of the Company’s business.  It is not intended to and does not create any legal rights for any supplier, partner, competitor, shareholder or any other person or entity.

XVI.MODIFICATION AND AMENDMENT

This Code shall be reviewed periodically by the Nominating and Corporate Governance Committee of the Board of Directors and shall be updated as deemed appropriate or necessary by the Board of Directors.

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EX-99.2

Exhibit 99.2

通 商 律 師 事 務 所

Commerce & Finance Law Offices

上海市南京西路1515号静安嘉里中心办公楼1座1506室

電話:8621-52986877  傳真: 8621-52986878

网址: www.tongshang.com.cn

[·], 2016

To: Gridsum Holding Inc.

Re: Legal Opinion on Certain PRC Legal Matters

Dear Sirs,

We are qualified lawyers registered in the People’s Republic of China (the “PRC”, for the purpose of this opinion, excluding Hong Kong, Macau and Taiwan) and are qualified to issue an opinion on PRC Laws.

We have acted as legal counsel as to PRC Laws to Gridsum Holding Inc. (the “Company”), a company incorporated under the laws of the Cayman Islands, in connection with its registration statement on Form F-1 including all amendments or supplements thereto (the “Registration Statement”) filed with the U.S. Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended (the “Securities Act”), relating to the proposed initial public offering (the “Offering”) of American Depository Shares (the “ADS”), and the proposed listing of the ADSs on the NASDAQ Global Market (the “Listing”).

In order to issue this opinion, we have reviewed matters relating to PRC Laws that are relevant to the Offering and Listing (limited to the issues covered by this opinion), examined documentation and other materials provided to us by the Company and made such other investigations as we have deemed necessary or advisable for the purposes of rendering this opinion.

In our examination, we have assumed the genuineness of all signatures, chops and seals, the authenticity of all documents submitted to us as originals and the conformity with authentic originals of documents submitted to us as copies. We have also assumed that the documents from the time they were presented to us up to the date of this legal opinion have remained in full force and effect and that none of the documents has been revoked, amended, varied or supplemented. We have further assumed the accuracy and completeness of all factual statements in the documents. Where important facts were not

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independently established to us or where important files were not sufficiently provided to us, we have relied upon certificates issued by governmental agents and documents, materials, statements and representations made to us by representatives of the Company and the PRC Operating Entities. We have assumed that no information which is relevant to the Offering and Listing and this opinion has been withheld from us by the Company or the PRC Operating Entities, and that all covenants, representations and warranties in the commitment letter or other similar documents provided by the Company, the PRC Operating Entities and/or their senior management are and remain accurate and true in all respects.

If any evidence comes to light that would indicate any of the documents or materials referred to above contain any legal deficiency, inaccuracy or other such defect, or if any of the assumptions upon which this opinion are based prove to be incorrect, we reserve the right to revise any relevant expression or conclusion contained in this opinion and/or issue a supplementary legal opinion, interpretation or revision to this opinion according to further certified facts.

This opinion is rendered on the following bases:

(i)We make no prediction as to any revision, adjustment or new interpretation of any PRC Laws or related government policy, nor is this opinion intended to contain any advice or suggestion in respect of any such prediction.

(ii)Our understanding and judgment of the facts underlying this opinion are based solely on the materials referenced above. We have not investigated whether or not the statements, certificates, approvals, answers, replies and other documents issued by, among others, government authorities, the Company and the PRC Operating Entities have gone through all necessary review, investigation, discussion and examination/approval procedures as required by law or internal policy and we will not, therefore, be liable for any untruthfulness, inaccuracy, incompleteness or lack of integrity in respect of the content of any such document.

(iii)This opinion addresses specific legal matters relating to the Company and the PRC Operating Entities (limited to the issues covered herein) in respect of PRC Laws. We do not express any opinion in whatsoever manner on, or bear any legal liabilities for, any other issue(s) concerning the Company or the PRC Operating Entities including but not limited to financial documents, audits, appraisals, legal issues under foreign or international laws or any other issues not covered herein. In this opinion, any references to or descriptions of financial documents, audits, appraisals or legal issues under foreign laws are all cited from reports by professional institutions or written documents provided to us by the Company or the PRC Operating Entities and any such citation shall not constitute our acknowledgement of, legal opinions regarding or comments relating to such

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issues, whether expressed or implied.

The following terms as used in this opinion as defined as follows:

(i)“Beijing Yunyang” means Beijing Yunyang Ad Co., Ltd.;

(ii)        “Beijing Yizhun” means Beijing Gridsum Yizhun Technology Co., Ltd.;

(iii)“Dissector (Beijing)” means Dissector (Beijing) Technology Co. Ltd.;

(iv)“Gridsum Holding (Beijing)” means Gridsum Holding (Beijing) Co., Ltd.;

(v)“Gridsum Technology” means Beijing Gridsum Technology Co., Ltd.;

(vi)“Guoxinjunhe” means Guoxinjunhe (Beijing) Technology Co., Ltd.;

(vii)      “Guoxinwangyan” means Beijing Guoxinwangyan Technology Co., Ltd.;

(viii)“Moment Everlasting” means Beijing Moment Everlasting Ad Co., Ltd.;

(ix)“M&A Rules” means the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors jointly adopted by six PRC regulatory agencies on August 8, 2006, which became effective on September 8, 2006 and was amended on June 22, 2009;

(x)“PRC Laws” means any and all officially published and publically available laws, regulations, rules and regulatory, administrative or other governmental measures, notices or circulars of the PRC currently in existence as of the date of this opinion;

(xi)“PRC Government Agency” means any national, provincial or local governmental, regulatory or administrative authority, agency or commission in the PRC, or any court, tribunal or any other judicial or arbitral body in the PRC; and

(xii)“PRC Operating Entities” means Dissector (Beijing), Gridsum Technology, Guoxinjunhe, Moment Everlasting, Beijing Yunyang, Beijing Yizhun, Guoxinwangyan and Gridsum Holding (Beijing).

Based on the foregoing, and subject to the qualifications, assumptions and limitations stated herein, we are of the opinion that:

(1)Based on our understanding of the current PRC Laws (a) the ownership structures of Dissector (Beijing), Gridsum Holding (Beijing), Gridsum Technology, Guoxinjunhe, Moment Everlasting, Beijing Yizhun, Guoxinwangyan and Beijing Yunyang, both currently and immediately after giving effect to the Offering, do not and will not violate applicable PRC Laws; and (b) each of the contracts as set forth in the Schedule

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hereto (the “VIE Contracts”), among Dissector (Beijing), Gridsum Holding (Beijing) and its shareholders, is valid, binding and enforceable in accordance with applicable PRC Laws, and does not violate applicable PRC Laws, and that Dissector (Beijing) may serve as an attorney for the shareholders of Gridsum Holding (Beijing). However, there are substantial uncertainties regarding the interpretation and application of PRC Laws and future PRC laws and regulations, and there can be no assurance that any PRC Government Agency will take a view that is not contrary to or otherwise different from our opinion stated above.

(2)The M&A Rules purports, among other things to require offshore special purpose vehicles (“SPVs”) formed for overseas listing purposes through acquisitions of PRC domestic companies and controlled by PRC companies or individuals, to obtain the approval of the China Securities Regulatory Commission (the “CSRC”) prior to publicly listing their securities on an overseas stock exchange. On September 21, 2006, the CSRC published on its official website procedures regarding its approval of overseas listings by SPVs. Based on our understanding of the PRC Laws (including the M&A Rules), a prior approval from the CSRC is not required for the Offering because (a) CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like this Offering are subject to M&A Rules and (b)  Dissector (Beijing) was established by means of direct investment other than by merger or acquisition of PRC domestic companies and no explicit provision in the M&A Rules classifies the contractual arrangements contemplated under the VIE Contracts as a type of acquisition transaction falling under the M&A Rules. However, uncertainties still exist as to how the M&A Rules will be interpreted and implemented and our opinion stated above is subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules.

(3)The summary of the VIE Contracts under the heading “Corporate History and Structure — Contractual Arrangements with Gridsum PRC Holding and its Shareholders”, to the extent that it constitutes matters of PRC Laws, are correct and accurate in all material aspects, and nothing has been omitted from such statements which would make the same misleading in any material respect.

(4)The statements set forth in the Registration Statement under the heading “Taxation — People’s Republic of China Taxation”, to the extent that the discussion states definitive legal conclusions under PRC tax laws and regulations, subject to the qualifications therein, constitute our opinion on such matters.

(5)There is uncertainty as to whether the courts of the PRC would: (a) recognize or enforce judgments of United States courts obtained against the Company or directors or officers of the Company predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States; or

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(b) entertain original actions brought in each respective jurisdiction against the Company or directors or officers of the Company predicated upon the securities laws of the United States or any state in the United States.

(6)Under the PRC Enterprise Income Tax Law and the Implementation Regulations of the PRC Enterprise Income Tax Law (collectively, “the EIT Law”) which took effect on January 1, 2008, an enterprise established outside of the PRC with its “de facto management body” within the PRC may be deemed by the PRC tax authorities to be a “resident enterprise” and subject to PRC enterprise income tax at a rate of 25% in respect of income sourced from both within and outside the PRC. If the relevant tax authorities determine, in accordance with the EIT Law and other applicable tax rules and regulations, that the actual management organ of the Company is within the territory of China, the Company may be deemed to be a resident enterprise for the purpose of the EIT Law and be subject to enterprise income tax at the rate of 25% on its income sourced from both within and outside China. As confirmed by the Company, up to the date of this opinion, it has not been notified or informed by the PRC tax authorities that it has been deemed to be a resident enterprise for the purpose of the EIT Law.

This Opinion is subject to the following qualifications:

(a)This Opinion is subject to (i) applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws affecting creditors’ rights generally, and (ii) possible judicial or administrative actions or any PRC Laws affecting creditors’ rights.

(b)This Opinion is subject to (i) certain equitable, legal or statutory principles that affects the enforceability of contractual rights generally under concepts of public interest, interests of the state, national security, reasonableness, good faith and fair dealing, and applicable statutes of limitation; (ii) any circumstances where the formulation, execution or implementation of any legal documents would be deemed to be materially mistaken, clearly unconscionable, fraudulent, or coercionary at the conclusions thereof; (iii) judicial discretion with respect to the availability of indemnifications, remedies or defenses, the calculation of damages, the entitlement to attorney fees and other costs, and the waiver of immunity from jurisdiction of any court or from legal process; (iv) filing and other procedural requirements with the PRC Government Agency in enforcing any legal documents; and (v) the discretion of any competent PRC legislative, administrative or judicial bodies in exercising their authority in the PRC.

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This opinion is delivered solely for the purpose of and in connection with the Registration Statement publicly submitted to the U.S. Securities and Exchange Commission and may not be used for any other purpose without our prior written consent.

We hereby consent to the use of this opinion in, and the filing hereof as an exhibit to, the Registration Statement, and to the use of our firm’s name under the captions “Risk Factors”, “Enforceability of Civil Liabilities”, “Corporate History and Structure”, “PRC Regulation” and “Legal Matters” in the Registration Statement. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the U.S. Securities Act of 1933, as amended, or the regulations promulgated thereunder.

Yours sincerely,

Commerce & Finance Law Offices

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Schedule

VIE Contracts

(1)Exclusive Business Cooperation Agreement dated December 22, 2014 between Dissector (Beijing) and Gridsum Holding (Beijing).

(2)Exclusive Option Agreements, each dated December 22, 2014, among Dissector (Beijing), Gridsum Holding (Beijing) and the shareholders of Gridsum Holding (Beijing).

(3)Shareholders Voting Rights Proxy Agreements, each dated December 22, 2014, among Dissector (Beijing), Gridsum Holding (Beijing) and the shareholders of Gridsum Holding (Beijing).

(4)Equity Pledge Agreements, each dated December 22, 2014, among Dissector (Beijing), Gridsum Holding (Beijing) and the shareholders of Gridsum Holding (Beijing).

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