# Compute-SAFE — Standard Term Sheet

**Compute for Equity · illustrative standard form**
*This is a non-binding template for discussion. Not legal advice, not an offer. Final terms are
set per deal and papered under the applicable ADGM/FSRA framework.*

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## Summary

A **Compute-SAFE** is a Simple Agreement for Future Equity in which the consideration is **metered
compute** rather than cash. A compute provider (the "Provider") commits a capped amount of compute,
drawn by the company (the "Company") over a window, that converts into equity at the Company's next
priced equity financing, subject to a valuation cap, a discount, and a service-level (SLA)
suspension clause.

## Key terms

- **Instrument:** Compute-SAFE (post-money SAFE mechanics; consideration paid in compute).
- **Principal amount:** the USD-denominated value of committed compute (e.g., $1,000,000).
- **Consideration:** metered GPU·hours delivered by the Provider, valued at the Oracle reference
  price agreed at signing, drawn against the Principal during the Draw Window.
- **Draw window:** the period during which the Company may draw compute (e.g., 6 months).
- **Valuation cap:** the maximum company valuation at which the instrument converts (e.g., $25M).
- **Discount rate:** the discount to the next-round price (e.g., 20%).
- **Conversion:** at the next priced equity financing, the Principal converts into the most
  senior class of shares issued, at the **lower of** (a) the valuation cap price and (b) the
  discounted round price — i.e., the price most favourable to the Provider.
- **SLA suspension clause:** if average GPU uptime delivered in any calendar month falls below
  **95%**, that month's draw is rolled forward to a subsequent month at no additional dilution; the
  Company converts equity only for compute actually delivered to spec.
- **Metering:** all compute is metered and logged; drawn value is reconciled against the Principal.
- **Custody & settlement:** the instrument is custodied and settled under the applicable
  ADGM/FSRA-regulated arrangements; client assets are held segregated.
- **Most-favoured-nation:** if the Company issues a SAFE or Compute-SAFE with more favourable terms
  before conversion, the Provider may elect those terms.
- **Transferability:** the instrument may, subject to regulatory and Company consent, become
  transferable on the Compute for Equity secondary market once eligible.
- **Information rights:** standard major-investor information rights on a pro-forma basis.
- **Governing law / venue:** ADGM; disputes per ADGM Courts or agreed arbitration.

## Worked illustration

For a $1,000,000 Compute-SAFE at a $25M cap and 20% discount:

| Next round (pre-money) | Governing price | Conversion price | Dilution |
|---|---|---|---|
| $20M (bear) | discount (20% off $20M = $16M) | $16,000,000 | 6.25% |
| $30M (base) | discount (20% off $30M = $24M) | $24,000,000 | 4.17% |
| $80M (bull) | cap ($25M < $64M) | $25,000,000 | 4.00% |

The dilution is bounded: the cap protects the Provider on the upside; the discount governs when the
round prices below the cap-adjusted threshold. See the live worked example at `/product/example`.

## Why this structure

- **For the Company:** acquire compute without a cash leg; preserve runway; bound and defer dilution
  to a priced round; shift uptime risk to the Provider via the SLA clause.
- **For the Provider:** convert idle or marginal compute into equity upside in vetted AI companies;
  standardized, custodied, and (eventually) tradable.
- **For the venue:** one standard instrument that is repeatable across deals and, once standardized
  at volume, supports a secondary market.

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*Human TODOs before any use: counsel to finalize conversion mechanics, MFN scope, transfer
restrictions, and ADGM-specific securities language; finance to confirm the Oracle reference-price
methodology referenced at signing.*