SAFE: Valuation Cap, No Discount (Singapore) by Y Combinator
The SAFE: Post-Money Valuation Cap (Singapore) is a Simple Agreement for Future Equity tailored for Singapore-incorporated companies. It allows investors to convert their investment into equity at the lower of the future financing price or a price based on a set valuation cap, protecting them from dilution. This is Y Combinator’s standard Singapore law version, widely used in early-stage startup financing.
THE OFFERING AND ISSUANCE OF THIS INSTRUMENT AND ANY SECURITIES ISSUABLE PURSUANT HERETO IS NOT ACCOMPANIED BY A PROSPECTUS REGISTERED WITH THE MONETARY AUTHORITY OF SINGAPORE. THESE SECURITIES MAY NOT BE RE-OFFERED OR RESOLD UNLESS THE RE-OFFER AND RESALE ARE MADE IN COMPLIANCE WITH THE SECURITIES AND FUTURES ACT (CHAPTER 289) OF SINGAPORE.
THIS INSTRUMENT AND ANY SECURITIES ISSUABLE PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES OF AMERICA SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT AS PERMITTED IN THIS SAFE AND UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM.
SAFE (Simple Agreement for Future Equity)
THIS CERTIFIES THAT in exchange for the payment by [investor name] (the “Investor”) of [purchase amount] (the “Purchase Amount”) on or about [effective date], Company Registration number [company registration number], a private limited company incorporated in Singapore (the “Company”), hereby issues to the Investor the right to certain of the Company’s Capital Shares, subject to the terms described below.
This Safe is one of the forms available at http://ycombinator.com/documents and the Company and the Investor agree that neither one has modified the form, except to fill in blanks and bracketed terms.
The “Post-Money Valuation Cap” is [post-money valuation cap]. See Section 2 for certain additional defined terms.
Events
(a) Equity Financing. If there is an Equity Financing before the termination of this Safe, on the initial closing of such Equity Financing, this Safe will automatically convert into the greater of: (1) the number of Standard Preference Shares equal to the Purchase Amount divided by the lowest price per share of the Standard Preference Shares; or (2) the number of Safe Preference Shares equal to the Purchase Amount divided by the Safe Price.
In connection with the automatic conversion of this Safe into Standard Preference Shares or Safe Preference Shares, the Investor will execute and deliver to the Company all of the transaction documents related to the Equity Financing; provided, that such documents (i) are the same documents to be entered into with the purchasers of Standard Preference Shares, with appropriate variations for the Safe Preference Shares if applicable, and (ii) have customary exceptions to any drag-along applicable to the Investor, including (without limitation) limited representations, warranties, liability and indemnification obligations for the Investor.
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