This model document is a work product developed under the auspices of the Singapore

Academy of Law ("SAL") with assistance and feedback from multiple parties.  Please see the
SAL website for a list of the working group members and contributors.

No information provided in this model document, which is part of the Venture Capital
Investment Model Agreement ("VIMA") kit should be construed as legal advice (including for
any fact or scenario described in such document or any assumptions made in relation to such
document).  This document and the terms herein are intended to serve as a starting point only
and should be tailored to meet your specific legal and commercial requirements. Additional
documents may be required for your transaction. Neither SAL nor any of the working group
members or contributors takes any responsibility for the contents of this model document.
Please obtain legal, tax and other professional advice accordingly.

SHORT FORM TERM SHEET

©2018 Singapore Academy of Law, Singapore Venture Capital & Private Equity Association and other contributors. You may
modify this document for your use in transactions, but please do not publicly disseminate a modified version of this document
without seeking prior approval from the copyright owners.
 Explanatory Note
A term sheet sets out key terms and conditions pursuant to which an investor (or group of investors)
will subscribe for shares in a company. It also sets out the ongoing rights and obligations of the
investors, founders and the company in relation to such company. Except for certain provisions, a
term sheet is a non-binding agreement and the relevant parties must then enter into binding
agreements to give effect to its terms.
This model term sheet assumes:

 a Singapore incorporated private company and its founders are entering into a term sheet
with multiple investors for a Series-A financing round, with one investor leading such financing
round;

 Series-A preference shares are being issued by the company to the investors;

 the founders are the only shareholders of the company and hold ordinary shares in the
company; and

 all the investors that are party to this agreement will subscribe for the Series-A preference
shares, and pay the corresponding subscription price, at the same time.

This model term sheet should be customised to consider the capital structure of the company
(including any rights existing investors may have).

Further explanatory notes are included in this model term sheet.

2
 SHORT FORM TERM SHEET RELATING TO THE SUBSCRIPTION OF
SERIES A PREFERENCE SHARES OF [INVESTEE COMPANY]1

Dated: []

This short form term sheet summarises the principal terms of the proposed subscription (the
"Subscription") of Series A Preference Shares (the "Series A Shares" and each, a "Series A
Share") of [Investee Company] (the "Company") by [●Lead Investor] (or its nominees) (the "Lead
Investor") and [●Investor(s)] (or its/their nominees) (each, an "Investor" and collectively together
with the Lead Investor, the "Investors" and together with the Company and the Founders, the
"Parties" and each, a "Party").

This term sheet is not a commitment to invest, and is conditional upon the completion of due
diligence, legal review and documentation that is satisfactory to the Lead Investor.

This term sheet shall expire on [date] if not accepted by the Company and the Founders by such
date. This term sheet is not legally binding except for the terms in paragraph 9 – "Non-Binding".

GENERAL

1. Amount to be Raised S$[] as per Appendix I to be paid in full on completion of the

Subscription ("Closing").

2. Percentage of Ownership []% of the Company on a fully-diluted post-Closing basis as per

Appendix I.

3. Subscription Price, Pre- Price per Series A Share ("Subscription Price") to be based on a
Money Valuation fully diluted pre-money valuation of S$[] [(including the []%
ESOP – see paragraph 18 below)].

4. Anticipated Date of On or about [].

Completion

5. Founders The Founders are: [].

6. Use of Proceeds For the Company's [working capital requirements] / [●other

use of proceeds].

7. Exclusivity Exclusivity period of [] days beginning from the date of this term
sheet, or such longer period as may be agreed between the
Parties in writing.

8. Confidentiality2 The Parties agree to keep all negotiations with the Investor(s)
confidential, including the existence and contents of this term
sheet, except as required to be disclosed to its related
corporations, and any of its respective officers, directors,
employees and professional advisers solely in connection with the
Subscription.

1
Explanatory Note: This is a short form term sheet and may be used if the Parties prefer to postpone the discussion in relation
to the specifics of the various terms until the preparation of the subscription agreement and the shareholders' agreement.
2
Drafting Note: To be amended / removed accordingly if a separate non-disclosure agreement in relation to the Subscription is
in force.

3
9. Non-Binding This term sheet is not legally binding on the Parties, except for
paragraphs 7 – "Exclusivity", 8 – "Confidentiality", 9 – "Non-
Binding", 27 – "Counterparts", 28 – "Applicable Statutes and
Governing Law" and 29 – "Dispute Resolution" which are intended
to be legally binding.

10. Other Rights and The Investor(s) shall enjoy rights and privileges that are no less
Privileges favourable than those currently enjoyed by the existing
shareholders of the Company.

11. Expenses [Any required legal, financial, or other deal expenses incurred
by [the Lead Investor] / [names of specific Investor(s) who
are entitled to reimbursement] will be borne by the Company
subject to a cap of S$[] upon Completion.]

SUMMARY OF TERMS

12. Dividends [Cumulative] / [Non-cumulative] fixed preferential dividend

payable in cash equal to [●]% of the Subscription Price per
annum, ranking [pari passu with] / [senior and prior to and in
preference to] the dividend rights of the holders of ordinary
shares of the Company ("Ordinary Shares") and any other class
of shares in the Company.

13. Liquidation Preference [liquidation preference], [participating / non-participating],

applicable if a prescribed liquidity event occurs.

14. Voting Rights3 Holders of Series A Shares to vote together on an as-converted

basis with the holders of Ordinary Shares, except as specifically
provided herein or the amended constitution of the Company or as
otherwise required by law.

15. Conversion Series A Shares convert into Ordinary Shares, at the holder's
option, at an initial conversion ratio of 1:1, subject to any
adjustment in accordance with Paragraph 16 – "Anti-dilution
Provisions".

The Series A Shares shall automatically be converted into

Ordinary Shares, at the then applicable conversion ratio (a)
immediately prior to the consummation of a Qualifying IPO (as
defined below) or (b) with the consent in writing of the Series A
Majority (as defined below).

As used in this term sheet:

(a) "Qualifying IPO" means the closing of a firmly

underwritten public offering of shares of the Company [at
a per share public offering price (prior to underwriting
commission and expense) with a pre-money valuation
of not less than S$[]], for the purpose of and in
connection with the admission of the Company to the
Official List of the Singapore Exchange Securities Trading

3
Drafting Note: To be amended accordingly.

4
 Limited or any other recognised securities exchange
agreed by the Series A Majority and the listing of the
shares of the Company on such securities exchange,
resulting in net proceeds of not less than S$[] being
raised; and

(b) "Series A Majority" means the [holder(s) of at least

[75]% of the outstanding Series A Shares from time to
time].

16. Anti-dilution Provisions4 Broad-based weighted average anti-dilution protection for any new
equity issuances (subject to customary exclusions) by the
Company at a price lower than the Subscription Price.

17. Representations and The Founders and the Company will give customary
Warranties representations and warranties for a transaction of this nature on
a [several and not joint] / [joint and several] basis [and subject
to limitations of liability].5

18. Employee Share Option [[●]% of the immediate post-Completion share capital of the
Plan ("ESOP")6 Company (on a fully-diluted basis) will be available for
issuance pursuant to [an ESOP to be established by the
Company, on terms reasonably acceptable to the Series A
Majority] / [the Company's existing ESOP]. Any increase of the
available ESOP to that [●]% level is [included in the pre-money
valuation] / [dilutive to all shareholders, including the
Investor(s)].

The holders of such compensatory Ordinary Shares (or options)

shall be subject to such restrictions on transfers provided for in the
shareholders' agreement.

19. Board of Directors Board of Directors will consist of a maximum of [] members.

Each Founder shall have the right to appoint [] directors (the
"Founder Director[s]").

As long as an Investor holds []% of the shares of the Company in

issue at such time, such Investor shall have the right to appoint []

4
Drafting Note: This term sheet provides for a broad-based weighted average ratchet mechanism. There are two (2) other main
types of anti-dilutive mechanisms that may be considered: narrow-based weighted average ratchet and full ratchet, both of
which are more advantageous to investors. The Parties are to discuss their preference for the appropriate mechanism for the
transaction.
5
Explanatory Note: Limitation of liability (including a cap) to be discussed and adjusted depending on negotiations and context
of investment.
6
Drafting Note: This term sheet provides for language covering the situations where (a) the Company has an existing ESOP
and (b) the Company does not have an existing ESOP. Further language may be included to provide for any key terms to be
incorporated into any ESOP.

5
 directors (the "Investor(s) Director[s]") [and appoint a
representative to attend as observer].

The quorum for any initial meeting of the Board of Directors shall
be [] Directors, at least [] of whom shall be [an] Investor
Director[s].

20. Reserved Matters7 Customary board and shareholder reserved matters (which shall
require the approval of a simple majority of the Board of Directors
(and including the approval of [all or at least [] of] Investor(s)
Director[s]) and the Series A Majority respectively) shall apply.

21. Pre-Emption Rights; Right Customary pre-emptive rights over new equity issuances (subject
of First Refusal to customary exclusions) and right of first refusal of any transfer of
existing securities of the Company shall apply.

22. Tag-Along Right Customary tag-along rights over any proposed sale of securities of
the Company shall apply.

23. Drag-Along Right8 Collectively, [shareholders representing at least [75%] of the

issued share capital of the Company (on an as-converted
basis) (who shall include the Series A Majority)], shall have
customary drag-along rights.

24. Restrictions on Founder Each Founder shall not transfer [any / more than []%] of his
Transfers9 shares in the Company within [] months from the date of
Completion (subject to customary exclusions).

25. Restrictive Covenants on Each Founder shall be required to give customary non-compete
Founders and non-solicitation undertakings and covenants.

26. Information Rights Customary information and inspection rights shall apply.

27. Counterparts This term sheet may be signed in any number of counterparts and
by the Parties on separate counterparts, each of which, when so
executed, shall be an original, but all counterparts shall together
constitute one and the same document. Signatures may be
exchanged by e-mail, with original signatures to follow. Each Party
agrees to be bound by its own electronic signature and that it
accepts the electronic signature of the other Parties.

28. Applicable Statutes and A person who is not a party to this term sheet has no rights under
Governing Law the Contracts (Rights of Third Parties) Act, Chapter 53B of
Singapore.

This term sheet shall be subject to the provisions of the

Companies Act, Chapter 50 of Singapore.
7
Drafting Note: A version of the board and shareholder reserved matters may be obtained from the long form term sheet.
8
Drafting Note: There are many variations to the drag-along right provision. As a start, this term sheet provides for drag-along
rights to be triggered if shareholders representing at least 75% of the issued share capital of the Company (on an as-converted
basis) (who shall include the Series A Majority) agree to exercise such drag-along right. The Parties may also wish to consider
whether they prefer the drag-along right to be made subject to additional conditions so as to ensure, e.g. that the drag-along
right is only exercisable in certain scenarios contemplated by the Parties (e.g. at a certain exit valuation).
9
Drafting Note: To be amended accordingly. Note that such provisions are unique to the deal in question and subject to
negotiations. The lock-up period will depend on factors such as the nature of the industry and the investment stage of the
Company.

6
 This term sheet shall be governed by, and construed in
accordance with, the laws of Singapore.

29. Dispute Resolution10 In event of any dispute arising out of or in connection with this
term sheet, including any question regarding its existence, validity
or termination (the "Dispute"), a Party may give notice to the other
Parties to submit the Dispute to mediation to the Singapore
Mediation Centre ("SMC").11

If the Parties agree to submit such Dispute to SMC, the Parties

will have [30 days] from the date of submission of such Dispute to
SMC to resolve such Dispute in accordance with SMC's Mediation
Procedure in force for the time being. Unless otherwise agreed by
the Parties, the mediator(s) will be appointed by SMC and the
mediation will take place in Singapore in the English language and
the Parties shall be bound by any settlement agreement reached.

If the Parties do not agree to submit the Dispute to SMC or the

Parties are unable to resolve the Dispute through mediation during
the period set out in this paragraph 29, in such case,

[OPTION 1: COURT]

[the Parties irrevocably agree that the courts of Singapore are

to have exclusive jurisdiction to settle any such Dispute.]12

[OPTION 2: ARBITRATION]

[the Dispute, shall be referred to and finally resolved by

arbitration administered by the Singapore International
Arbitration Centre13 in accordance with the Arbitration Rules
of the Singapore International Arbitration Centre for the time
being in force, which rules are deemed to be incorporated by
reference in this paragraph 29. The seat of the arbitration
shall be Singapore. The Tribunal shall consist of one
arbitrator. The language of the arbitration shall be English.]

10
Drafting Note: To be amended depending on whether court proceedings, arbitration or mediation is the preferred dispute
resolution mechanism. This term sheet provides the Parties to opt for mediation in the first instance. The Parties should
consider whether court proceedings or arbitration should be resorted to in the event the Dispute is not resolved by mediation.
11
Drafting Note: The Singapore Mediation Centre's website may be accessed at: http://www.mediation.com.sg/. The Singapore
International Mediation Centre is another designated mediation service provider in Singapore, and its website may be accessed
at: http://simc.com.sg/.
12
Drafting Note: Parties may also wish to consider the Singapore International Commercial Court as a dispute forum and its
website may be accessed at: https://www.sicc.gov.sg/.
13
Drafting Note: The Singapore International Arbitration Centre's website may be accessed at: http://www.siac.org.sg/.

7
Acknowledged and Agreed to by:14

The Company

Signed by [insert name of director]

for and on behalf of [insert name of the Company]

………………………..
Director
Name:

in the presence of:

...............................
Witness
Name:
Address:

14
Drafting Note: Depending on the number of Parties involved, these execution blocks should be amended accordingly.

8
[Investor 1]

Signed by [insert name of director]

for and on behalf of [insert name of Investor 1]

………………………..
Director
Name:

in the presence of:

...............................
Witness
Name:
Address:

9
 [Investor 2]

Signed by [insert name of director]

for and on behalf of [insert name of Investor 2]

………………………..
Director
Name:

in the presence of:

...............................
Witness
Name:
Address:

10
[Founder 1]

Signed by [insert name of Founder 1]

………………………..
[insert name of Founder 1]

in the presence of:

...............................
Witness
Name:
Address:

11
[Founder 2]

Signed by [insert name of Founder 2]

………………………..
[insert name of Founder 2]

in the presence of:

...............................
Witness
Name:
Address:

12
 APPENDIX I

LEAD INVESTOR AND INVESTORS

Investor Number of Shareholding Subscription Price (S$)

Series A percentage, on a fully-
Shares diluted post-money
basis

[Lead Investor] [●] [●]% [●]

[other [●] [●]% [●]

Investor(s)]

Total [●] [●]% [●]

13