[Startup Investment] SAFE (Shareholders Agreement) Investment Agreement Drafting and Related Foreign Exchange Transaction Reporting Legal Advice

Law firm Veat undertook the process of drafting SAFE (Conditional Equity Purchase Agreement) investment contracts and related foreign exchange reporting procedures in response to a commission from educational platform A Corp.

Law firm Veat reviewed investment term sheets required for overseas venture capital firms to conduct SAFE investments in Korean startups, and based on this, we performed all foreign exchange transactions necessary for this case, including drafting Korean and English SAFE investment contracts.

In the case of SAFE, the ‘Act on Promotion of Venture Investment’ stipulates the conditions under which venture capitalists can invest in SAFE, and we provided guidance on related content.

A Conditional Equity Purchase Agreement is a contract without a repayment maturity date for the investment amount and without interest, and is conducted in the early stages when it is difficult to estimate corporate value, and the equity is determined according to the corporate value if it is evaluated.

When an overseas company conducts an SAFE investment contract, it is necessary to examine related laws such as the Foreign Exchange Transactions Act before transferring funds from overseas to Korea, and it is necessary to check whether the procedure needs to be carried out. If the reporting obligation is missed, a penalty may be imposed, so please confirm with a legal expert.

Law firm Veat operates the ‘Overseas Investment Reporting Center’ to ensure the smooth progress of foreign exchange reporting business.

If you need legal advice regarding the process of conducting foreign exchange transactions, such as SAFE (Conditional Equity Purchase Agreement), please contact Law firm Veat.

Thank you.

Law firm Veat.