The Safe Equity Agreement serves as a critical instrument in Indonesia's growing startup ecosystem, providing a simplified alternative to conventional equity investment structures. This document is typically used when a startup company seeks early-stage funding but wants to defer company valuation until a later financing round. Created in compliance with Indonesian corporate law and investment regulations, it bridges the gap between initial funding needs and formal equity rounds. The agreement includes essential provisions for investment amount, conversion mechanisms, and investor rights, while addressing specific Indonesian regulatory requirements such as bilateral language requirements and foreign investment restrictions. The document is particularly valuable for pre-seed and seed-stage investments where traditional equity financing might be premature or impractical.
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1. Parties: Identification of the company and the investor, including complete legal names, registration numbers, and addresses
2. Background: Brief context explaining the purpose of the agreement and the company's intention to raise capital through the SAFE instrument
3. Definitions: Key terms used throughout the agreement, including 'Equity Financing', 'Liquidity Event', 'Dissolution Event', and 'Conversion Price'
4. Investment Amount: Specifies the investment amount and payment terms, including currency and payment method
5. Events Triggering Conversion: Details of circumstances that trigger conversion of the SAFE into equity, including equity financing rounds and liquidity events
6. Conversion Mechanism: Specific calculations and procedures for converting the SAFE into equity, including valuation cap and/or discount rate
7. Company Representations: Company's warranties regarding its legal status, authority to enter agreement, and compliance with Indonesian law
8. Investor Representations: Investor's warranties regarding investment capacity and compliance with applicable laws
9. Information Rights: Investor's rights to receive company information and financial statements
10. Governing Law and Dispute Resolution: Specifies Indonesian law as governing law and method of dispute resolution
11. Notices: Communication procedures between parties, including acceptable methods and addresses
12. Language: Specifies that the agreement is in both Indonesian and English, with Indonesian version prevailing in case of conflict
1. Most Favored Nation: Provision ensuring investor receives terms as favorable as any subsequent SAFE investors - used when requested by sophisticated investors
2. Pro-rata Rights: Gives investor right to participate in future financing rounds - included for strategic investors
3. Board Observer Rights: Grants investor right to attend board meetings as observer - used for larger investments
4. Confidentiality: Detailed confidentiality obligations - included when not covered by separate NDA
5. Foreign Investment Compliance: Additional provisions ensuring compliance with Indonesian foreign investment regulations - required for non-Indonesian investors
6. Tax Provisions: Specific tax-related provisions and responsibilities - included when tax implications need clarification
1. Capitalization Table: Current cap table showing company's shareholding structure
2. Form of Conversion Notice: Template notice for triggering SAFE conversion
3. Investment Wire Instructions: Bank account details and payment instructions
4. Corporate Authorizations: Copies of relevant corporate approvals and authorizations
5. Disclosure Schedule: Company disclosures against representations and warranties
6. Calculation Examples: Examples illustrating conversion calculations in different scenarios
Find the exact document you need
Safe Equity Agreement
An Indonesian law-governed SAFE agreement for early-stage investment in startups, providing rights to future equity subject to specified conversion events.
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