Purchase Agreement for Convertible Note by Cofounders

Purchase Agreement for Convertible Note

This agreement (the Agreement) is made on [Date]

between:

[Company Name], ([Reg No.]) a company incorporated in Singapore with its registered office [Company Address] (the Company); and

[Investor Name], (Identification Number: [Investor Co. Reg/Passport/ID number]) of [Investor Address] (the Investor)

(the Company and the Investor shall collectively be known as the Parties and each, a Party).

Whereas:

The Company is a private company incorporated in Singapore limited by shares.

The Investor and the Company desire and wish to enter into this Agreement to regulate the affairs of the Company and the relationship between the Parties.

It is hereby agreed as follows:

Definitions

In this Agreement, except to the extent that the context otherwise requires, the following terms shall have the meanings set forth below:

“Qualified Financing”. The issuing of equity securities (Equity Securities) in a transaction or series of related transactions resulting in aggregate gross proceeds to the Company of at least S$1,000,000, including conversion of the Notes and any other indebtedness.

Subscription

The Investor agrees to invest S$100,000 (the Investment Amount) in the Company by way of the convertible promissory notes (the Notes) issued by the Company to the Investor in denominations of S$5,000 each.

Maturity Date

The Notes and unpaid accrued interest on the Notes will be due and payable 24 months from the date of the signing of this Agreement (the Maturity Date).

Interest

Interest on the Notes will accrue on an annual basis at the rate of 5% per annum based on a 365 days year.

Conversion Price

The Conversion Price is the lesser of

70% of the per share price paid by the purchasers of such Equity Securities in the Qualified Financing (the Discounted Conversion Price), or

the price per share equal to S$4,000,000 divided by the aggregate number of outstanding shares of the Company's common stock as of immediately after the initial closing of the Qualified Financing (assuming full conversion or exercise of all convertible and exercisable securities then outstanding other than the Notes) (the Valuation Cap).

Automatic Conversion

Automatic Conversion in a Qualified Financing

If the Company issues Equity Securities in a Qualified Financing, then the Notes, and any accrued but unpaid interest thereon, will automatically convert into the equity securities issued pursuant to the Qualified Financing at the Conversion Price.

Automatic Conversion at the Maturity Date

If the Notes have not been previously converted pursuant to a Qualified Financing, then, effective upon the Maturity Date, the Notes, and any accrued but unpaid interest thereon, will automatically convert into Equity Securities at 70% of the Valuation Cap.

Optional Conversion

If the Maturity Date or a Qualified Financing has not occurred, the Investor may elect to convert the entire Investment Amount into Equity Securities at the Valuation Cap.

Sale of the Company

If a Qualified Financing has not occurred and the Company elects to consummate a sale of the Company prior to the Maturity Date, then upon the election of the Investor, either

the Investor shall receive a payment equal to one and half (1.5) times the Notes, or

the entire Investment Amount shall convert into Equity Securities at the Valuation Cap.

Pre-Payment

The principal and accrued interest may not be prepaid unless approved in writing by Investors holding Notes whose aggregate principal amount represents a majority of the outstanding principal amount of all then-outstanding Notes (the Requisite Holders).

Participation Rights

After converting to Equity Securities upon the conditions laid out in clause 6 and 7, Investor will have the rights to participate in subsequent financing rounds of the Company in order to maintain their percentage (%) shareholding in the Company.

Amendment and Waiver

The terms of this Agreement and the Notes may be amended, or any term thereof waived, upon the written consent of the Company and the Requisite Holders.

No Security Interest

The Notes will be a general unsecured obligation of the Company.

Investor Rights

The Investor will have customary information and inspection rights, including receiving an annual budget, annual unaudited financial statements, quarterly unaudited financial statements, and any other information reports prepared for shareholders while the Notes remains outstanding.

Fees And Expenses

The Parties will bear their own fees and expenses incurred in the transaction.

Governing Law and Jurisdiction

This Agreement shall be governed by and construed according to the laws of Singapore.

As witness this Agreement has been signed by or on behalf of each of the Parties hereto the day and year first before written.