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

Academy of Law ("SAL") and the Singapore Venture & Private Capital Association ("SVCA")
with assistance and feedback from multiple parties. Please see the SAL website or SVCA
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 2.0 ("VIMA 2.0") 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, SVCA
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

©2022 Singapore Academy of Law and Singapore Venture & Private Capital Association. You may modify this document for
your use in transactions, but the contents of this document, whether original or modified, may not be reproduced, republished
or transmitted to the public in any form or by any means, in whole or in part, without written permission 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 which
are stated to be legally binding among the parties, 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;

 there is an intervening period between the date of signing of the subscription agreement and
the completion date when Series A preference shares are issued by the company to the
investors;

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

 prior to the issuance of the Series A preference shares, the founders are the only
shareholders of the company and hold ordinary shares in the company;

 all the investors that are party to the subscription agreement will subscribe for the Series A
preference shares, and pay the corresponding subscription price, at the same time in a single
completion; and

 a shareholders' agreement between the company, the investors and the founders will come
into effect at completion of the subscription.

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 execution of definitive documentation (the "Definitive Documentation") that are
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 ("Subscription Consideration") to be

paid in full on completion of the Subscription ("Completion").

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

Appendix I.

3. Initial Subscription Price Price per Series A Share ("Initial Subscription Price Per Share")
Per Share, Fully Diluted to be based on a fully diluted pre-money valuation of S$[] [(and
Pre-Money Valuation for the avoidance of doubt, including the []% employee
share option pool – see paragraph 19 below)].

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

Completion

5. Founders The Founders are: [].

6. Use of Proceeds2 [In the furtherance of the Company's business in accordance

with the Business Plan and Annual Budget] / [towards the
Group's working capital requirements].

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. Confidentiality3 The Parties agree to keep all negotiations with the Investor(s)
confidential, including the existence and contents of this term

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 amend, as appropriate, to reflect the agreed use of the Investors' subscription proceeds.
3
Drafting Note: To be amended / removed accordingly if a separate non-disclosure agreement in relation to the Subscription is
in force.

3
 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.

9. Non-Binding This term sheet is not legally binding on the Parties, except for
paragraphs 7 – "Exclusivity", 8 – "Confidentiality", 9 – "Non-
Binding", 28 – "Counterparts", 29 – "Applicable Statutes and
Governing Law" and 30 – "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, accounting and due diligence fees and
disbursements 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.]

The Company, the Founders and the other Investors shall bear
their own costs and disbursements incurred in the negotiations
leading up to and in the preparation of the Definitive
Documentation and of matters incidental to the Definitive
Documentation.

SUMMARY OF TERMS

12. Dividends [Holders of Series A Shares shall be entitled to receive dividends

and distributions payable on the ordinary shares of the Company
("Ordinary Shares") as and when declared on an as-converted
basis.] / [[Cumulative] / [Non-cumulative]4 fixed preferential
dividend payable in cash equal to [●]% of the Initial Subscription
Price Per Share (as appropriately adjusted for any subdivisions,
consolidations, share dividends or similar recapitalisations) per
annum for each Series A Share held by each holder of Series A
Share.]

The right of the holders of Series A Shares to receive such

dividends shall rank [on a pari passu basis with] / [senior and
prior to and in preference to] the dividend rights of the holders
of Ordinary Shares and any other class of shares in the Company.

13. Liquidation Preference [1.0x plus accrued but unpaid dividends], [participating / non-
participating], applicable if a prescribed liquidity event occurs.

14. Voting Rights5 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.

4
Drafting Note: Please refer to the Lexicon for an explanation on the differences between cumulative and non-cumulative
dividends.
5
Drafting Note: To be amended accordingly.

4
 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) or with the sanction of [a special
resolution] passed at a separate class meeting of the holders of
the Series A Shares.

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 fully diluted pre-
money valuation of not less than S$[]], for the purpose
of and in connection with the admission of the Company
to the Official List of the Singapore Exchange Securities
Trading Limited or any other recognised securities
exchange agreed by the Series A Majority and the listing
of the shares of the Company on such securities
exchange, resulting in net proceeds to the Company of
not less than S$[] being raised; and

(b) "Series A Majority" means the [holder(s) of [more than

50] / [at least [75]]% of the outstanding Series A
Shares from time to time].

16. Anti-dilution Provisions6 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 then applicable conversion
price.

17. Conditions Precedent Completion shall be conditional upon the fulfilment of customary
conditions precedent for a transaction of this nature, as well as
any transaction-specific conditions precedent, to the satisfaction of
the [Lead Investor], other than those Conditions that have been
waived by the [Lead Investor] on or before Completion.7

18. Representations and Unless otherwise agreed by the Parties, the Founders and the
Warranties; General Company will give customary representations and warranties for a
Indemnity; Liability Basis transaction of this nature and shall provide a general indemnity
against the same, subject to customary limitations on liability for a
transaction of this nature [on a joint and several basis / on a
several and not joint basis / jointly and severally between the
Company and the Founders but several between the

6
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. Please refer to the Lexicon for an explanation on the different formulations. The
Parties are to discuss their preference for the appropriate mechanism for the transaction.
7
Drafting Note: Transaction specific conditions precedent can also be included, for example, any work to be done to rectify
gaps uncovered by due diligence.

5
 Founders inter se].8

Unless otherwise agreed by the Parties, the liability of the

Founders under the shareholders’ agreement shall be [on a joint
and several basis / on a several and not joint basis].9

19. Employee Share Option [[●]% of the immediate post-Completion share capital of the
Plan ("Share Option Company (on a fully-diluted basis) will be available for
Plan")10 issuance pursuant to [a Share Option Plan to be established
by the Company, on terms reasonably acceptable to the
Series A Majority] / [the Company's existing employee share
option pool]]. Any increase of the Company's existing Share
Option Plan to that [●]% level is [included in the fully diluted
pre-money valuation].11

The holders of such compensatory Ordinary Shares (or options)

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

20. 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

(on an as-converted basis), such Investor shall have the right to
appoint [] 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].

21. Reserved Matters12 Customary board 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 [- insert number] of]
Investor Directors)) and shareholder reserved matters (which shall
require the approval of the Series A Majority [including the Lead
Investor]) shall apply.

22. 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. Available to [each
shareholder holding more than []% of the shares in the

8
Explanatory Note: While the representations and warranties to be given would be subject to negotiations and limitations and
depend on the business of the Company, warranties relating to the Company's share capital, authority and capacity, and
insolvency are standard fundamental warranties which should not be subject to any forms of limitations (e.g. on time periods or
amounts). Limitation of liability (including a cap) to be discussed and adjusted depending on negotiations and context of
investment.
9
Drafting Note: Please refer to the Lexicon for an explanation on the different liability bases. If the circumstances require the
Founders to give undertakings and provide confirmations as a group, then liability should be joint.
10
Drafting Note: This term sheet provides for language covering the situations where (a) the Company has an existing Share
Option Plan and (b) the Company does not have an existing Share Option Plan. Further language may be included to provide
for any key terms to be incorporated into any Share Option Plan.
11
Drafting Note: This term sheet assumes that the increase in the Company's existing employee share option pool is included
in the fully diluted pre-money valuation. Parties may also consider increasing the employee share option pool as part of the
post-money valuation which would have a dilutive effect on all shareholders, including the Investor(s).
12
Drafting Note: A version of the board and shareholder reserved matters may be obtained from the long form term sheet.

6
 Company (on an as-converted basis) (each such shareholder,
a “Significant Shareholder”)] / [all shareholders]. 13

23. Tag-Along Right Customary tag-along rights over any proposed sale of securities of
the Company shall apply. Available to holders of Series A Shares.

24. Drag-Along Right14 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.

25. Restrictions on Founder Each Founder shall not transfer his shares in the Company within
Transfers15 [] months from the date of Completion (subject to customary
exclusions or the consent of the Series A Majority).

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

27. Information Rights Customary information and inspection rights shall apply.
Available to [Significant Shareholders] / [all Investors].16

28. Counterparts This term sheet may be executed by the Parties hereto in
separate counterparts, each and all of which when so executed
and delivered to the Parties by facsimile, or by electronic mail in
"portable document format" (.pdf) form, or by any other electronic
means intended to preserve the original graphic and pictorial
appearance of a document, or by a combination of such means,
shall be deemed an original, but all such counterparts shall
together constitute one and the same instrument. Each
counterpart may consist of a number of copies hereof each signed
by less than all, but together signed by all of the Parties hereto.
Any Party may enter into this term sheet by signing any such
counterpart transmitted electronically, or by facsimile, or other
electronic signatures (such as DocuSign or AdobeSign), by any of
the Parties to any other Party and each receiving Party may rely
on the receipt of such document so executed and delivered as if
the original had been received. The Parties agree that signatures
executed by way of electronic means (such as DocuSign or
AdobeSign) shall be recognised and construed as secure
electronic signatures to the fullest extent under applicable law,
and that the Parties accordingly shall deem such signatures to be
original signatures for all purposes.
29. 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 2001.

13
Drafting Note: It is common for the pre-emption right to be extended to a smaller sub-set of shareholders that have a
meaningful/substantial stake.
14
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).
15
Drafting Note: It is common for Founders to be locked up at the Series A funding stage. The length of time for the lock-up will
be negotiated on a case by case basis and will depend on the deal/context. It is sometimes possible for Founders to negotiate
a small liquidity basket in later funding rounds, but this also tends to be negotiated on a case by case basis depending on the
deal/context.
16
Drafting Note: Parties to consider whether information or access rights should be provided or granted to Significant
Shareholders only, as opposed to all Investors.

7
 This term sheet shall be subject to the provisions of the
Companies Act 1967.

This term sheet shall be governed by, and construed in

accordance with, the laws of Singapore.

30. Dispute Resolution17 In the 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").

[OPTION 1: COURT]

[the Parties irrevocably agree that the courts of Singapore are

to have exclusive jurisdiction to settle any such Dispute.]18

[OPTION 2: ARBITRATION]

[the Dispute shall be referred to and finally resolved by

arbitration administered by the Singapore International
Arbitration Centre19 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 30. This arbitration agreement
shall be governed by Singapore law. The seat of the
arbitration shall be Singapore. The Tribunal shall consist of
one arbitrator. The language of the arbitration shall be
English. The award shall be final and binding on the Parties.
Judgment upon the award may be entered by any court
having jurisdiction thereof or having jurisdiction over the
relevant Party or its assets.]

The Parties hereto also agree that prior to the commencement of

[arbitration]/[litigation] proceedings, a Party hereto (the
"Requesting Party") may provide (but is not obliged to provide)
written notice to the other Party hereto (the "Receiving Party")
requesting to refer the Dispute to mediation in Singapore at the
Singapore Mediation Centre ("SMC") (the "Mediation Proposal")
in accordance with SMC’s Mediation Procedure for the time being
in force.20 If the Receiving Party agrees to the Mediation
Proposal, it shall provide its written confirmation to the Requesting
Party (the "Confirmation") within 14 days of receipt of the
Mediation Proposal. The Mediation Proposal and the Confirmation
shall together constitute the Parties’ agreement to mediate at
SMC (the "Agreement to Mediate"). For the avoidance of doubt,

17
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.
18
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/.
19
Drafting Note: The Singapore International Arbitration Centre's website may be accessed at: http://www.siac.org.sg/.
20
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/.

8
if no Confirmation is provided to the Requesting Party within 14
days of the Receiving Party’s receipt of the Mediation Proposal,
the Receiving Party shall be deemed to have rejected the
Mediation Proposal. Mediation shall be commenced by the
submission by either of the Parties of the Request for Mediation to
SMC. Unless otherwise agreed by the Parties hereto, the
mediation shall be conducted by one mediator appointed by SMC,
the mediation will take place in Singapore in the English language,
and the Parties hereto shall be bound by any settlement
agreement reached. If neither Party submits a Request for
Mediation to SMC within 14 days of the Receiving Party’s receipt
of the Confirmation or if the Parties hereto are unable to resolve
the Dispute through mediation within [30 days] of the submission
of the Request for Mediation to SMC, the Parties’ Agreement to
Mediate will lapse unless otherwise agreed.

9
Acknowledged and Agreed to by:21

The Company

Signed by [insert name of director]

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

………………………..
Director
Name:

21
Drafting Note: Depending on the number of Parties involved, these execution blocks should be amended accordingly.

10
[Investor 1]

Signed by [insert name of director]

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

………………………..
Director
Name:

11
[Investor 2]

Signed by [insert name of director]

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

………………………..
Director
Name:

12
[Founder 1]

Signed by [insert name of Founder 1]

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

13
[Founder 2]

Signed by [insert name of Founder 2]

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

14
 APPENDIX I22

Subscription Details

(1) (2) (3) (4)

Name of Investor Number of Subscription Shareholding
Series A Shares Consideration (S$) percentage (on a fully-
diluted post-money
basis) (%)

[Lead Investor] [●] [●] [●]

[other Investor(s)] [●] [●] [●]

Total [●] [●] [●]

22
Drafting Note: Subject to the finalisation of subscription details, Appendix I can be reflected in Schedule 3 of the subscription
agreement.

15