Draft Safe Agreement

---
name: ecvc-draft-safe-agreement
task_id: emerging-companies-venture-capital/draft-safe-agreement
description: Drafting a SAFE requires correctly implementing the conversion mechanics, resolving denominator circularity when multiple SAFEs co-convert, specifying dissolution payment priority relative to outstanding preferred, and defining MFN "more favorable terms" to prevent over-broad term upgrades.
activates_for: [planner, solver, checker]
---

# Skill: Draft Post-Money SAFE Package

## 1. Subject-matter triage

- Identify the governing form first: post-money SAFE, side letter, and drafting issues memo.
- Read the term sheet, existing SAFE, cap table, counsel emails, and diligence memo together before drafting any operative language.
- If the sources contain multiple investors, multiple SAFEs, or multiple side-rights holders, enumerate the parties and apply the drafting logic to each relevant instrument or holder set before finalizing.
- Treat the SAFE as the primary deliverable; the side letter and issues memo are secondary and must not substitute for a complete operative agreement.

## 2. Failure modes the skill is correcting

- The SAFE form is left ambiguous, so the conversion denominator and ownership mechanics do not match the chosen post-money structure.
- Multiple outstanding SAFEs are allowed to co-convert without a denominator definition that prevents circular math.
- The valuation cap and discount mechanics are stated inconsistently, leaving the conversion price indeterminate.
- Dissolution treatment is not aligned with the company’s capital stack, so payout priority is unclear.
- MFN language is drafted too broadly, causing unintended upgrades to unrelated future instruments or terms.
- Side-letter rights are granted without a clear linkage to the main SAFE or without a defined election and participation mechanism.
- The issues memo identifies drafting points but does not close them with concrete next steps.

## 3. Legal frameworks / domain conventions that apply

- Use the selected SAFE form consistently throughout the document set; once post-money is chosen, the capitalization definition, conversion price, and ownership logic must all track that form.
- For cap-and-discount mechanics, define the cap-based price, define the discount-based price, and then state which price controls by operation of the SAFE.
- For multiple co-converting SAFEs, define the denominator by reference to a pre-conversion capitalization concept so the calculation does not depend on the conversion result itself.
- For dissolution or winding-up treatment, state the payment waterfall expressly and place the SAFE in the correct order relative to any senior claims and preferred equity rights.
- If an MFN right exists, define the comparison universe, the term categories that can be compared, and the election mechanics so the right cannot be read as a blanket upgrade right.
- If pro rata or similar side rights are granted, specify who receives them, what financing trigger applies, and how participation is calculated.
- Where the source set references controlling legal or market authorities, cite them by name and section in the drafting issues memo and keep any doctrinal statement tethered to the cited authority.

## 4. Analytical scaffolds

- Draft the operative SAFE first, then the side letter, then the issues memo.
- Start with defined terms that support the conversion math, especially the capitalization base, conversion price, and financing trigger.
- Test the conversion provision against three questions: what is the cap-based result, what is the discount-based result, and what happens if both apply in the same financing.
- Test the denominator against a multi-SAFE scenario to ensure the formula can be applied without self-reference.
- Test the dissolution clause against the current capital structure to confirm the SAFE sits in the intended place in the waterfall.
- For any special investor right, confirm whether it belongs in the SAFE, the side letter, or both, and make the cross-document references consistent.
- Prepare the issues memo as a drafting roadmap: identify the issue, explain the interaction with other documents, and state the concrete drafting or diligence step needed to close it.

## 5. Vertical / structural / temporal relationships

- Keep the package internally synchronized: term sheet economics, existing SAFE provisions, cap table assumptions, and diligence facts must not conflict.
- If the cap table or source materials show multiple closings, multiple option pools, or other pre-financing adjustments, reflect their sequencing in the denominator and conversion assumptions.
- Distinguish pre-closing state, closing state, and post-conversion state so rights, ownership, and priority are measured at the correct time.
- Where a side letter amends economics or governance, make clear whether it survives, supplements, or limits the main SAFE.
- If the diligence memo identifies unresolved items, reflect them as open drafting issues rather than silently resolving them in the agreement.

## 6. Output structure conventions

- Deliver a complete, operative SAFE in the requested post-money form.
- Include side-letter language only if the sources support a separate investor-specific right or condition; otherwise keep it narrowly tailored to the disclosed deal terms.
- Make every defined term and formula consistent across the agreement and any attached side letter.
- In the drafting issues memo, group issues by document, economics, mechanics, and closing/open items.
- For each issue in the memo, state the applicable authority or drafting convention, the interaction with other source documents, and the practical consequence if left unresolved.
- End the memo with a concise Recommended Actions section that assigns each action to a responsible role and ties it to the closing process or another concrete timing anchor.
- Before finishing, confirm that the named output files are complete, non-empty, and contain operative drafting rather than summaries or placeholders.