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+# Proposal to reorganize OP Stack contracts folder structure
+
+## Context
+
+Currently, the OP Stack contracts are organized across multiple top level folders:
+
+- `cannon/`: Fault proof VM implementation and single instruction execution contracts
+- `dispute/`: Fault dispute game contracts for challenging invalid blocks and output root
+- `governance/`: Protocol governance contracts
+- `L1/`: Contracts deployed on L1
+- `L2/`: Contracts deployed on L2
+- `legacy/`: Deprecated contracts
+- `libraries/`: Shared library contracts
+- `periphery/`: Non core auxiliary contracts
+- `safe/`: Safe related contracts and modules
+- `universal/`: Contracts used on both L1 and L2
+- `vendors/`: Third-party developed contracts
+
+## Problem Statement
+
+The current organization has several drawbacks:
+
+1. Too many top-level folders make navigation difficult
+2. Folder names don't always reflect contract purposes:
+   - Cannon and Dispute contracts run on L1 but live in separate folders
+   - Governance contracts run on L2 but are in a governance folder
+   - Safe contracts are used on both L1/L2 but have their own folder
+   - Legacy and periphery contracts have their own folders and files are flattened rather than organized by layer
+
+## Proposed Solution
+
+We propose reorganizing contracts based on their deployment layer:
+
+1. Move layer specific contracts to their respective folders:
+
+   - `cannon/` → `L1/cannon/`
+   - `dispute/` → `L1/dispute/`
+   - `governance/` → `L2/governance/`
+
+2. Organize shared contracts:
+   - `safe/` → `universal/safe/`
+   - Split `legacy/` into `L1/legacy/`, `L2/legacy/`, `universal/legacy/`
+   - Split `periphery/` into `L1/periphery/`, `L2/periphery/`, `universal/periphery/`
+
+Afterwards, the `src/` folder will be organized as such:
+
+- `L1/`
+- `L2/`
+- `universal/`
+- `vendors/`
+
+This restructuring will:
+
+- Make contract purposes more immediately apparent
+- Simplify navigation
+
+## Risks, Uncertainties and Considerations
+
+- All import paths referencing these folders will need to be updated
+- Documentation and tooling may need path updates
+- The migration should be done atomically to avoid broken references