+ what happens to your holding on a down-round or restructure (this is hard not to get screwed on if this is the intention)
+ not checking that the options agreement has been signed by the company
+ not signing an options agreement and taking the company and/or founder at their word that you have stock
founders usually give themselves a sweet deal. ask to see their agreement and compare it to yours.
while you are at it, check the structure of the board and if the board are able to block an acquisition. you may be working for a company who can't exit unless the investors get at least 4-5x, and if they don't, you get nothing
there are probably some things that I am missing, which is why it is worth paying a lawyer for 3-4 hours of time to go over it (not the company lawyer - see 'the social network')
Liquidation preferences (in particular) are a big deal. It's entirely possible (if not common) for you to purchase stock that is literally worthless. In small and even mid-size exits certain employees simply won't get paid.
That' probably the best advice possible. If your employee number 3 and they want to to take a payout etc get 'liquidation preference 'on any lost income * risk + interest or work for someone else. If your employee #10 and they still want a significant pay-cut work for someone else.
PS: The law is on your side, as an employee lost pay is paid out before any other creditor but you need to list actual salary in $ and not just shares. You also can have issues with taxes so be careful.
+ who gets diluted
+ vesting schedule
+ does vesting accelerate with an acquisition?
+ liquidation preferences
+ how large is the employee option pool
+ what happens to your holding on a down-round or restructure (this is hard not to get screwed on if this is the intention)
+ not checking that the options agreement has been signed by the company
+ not signing an options agreement and taking the company and/or founder at their word that you have stock
founders usually give themselves a sweet deal. ask to see their agreement and compare it to yours.
while you are at it, check the structure of the board and if the board are able to block an acquisition. you may be working for a company who can't exit unless the investors get at least 4-5x, and if they don't, you get nothing
there are probably some things that I am missing, which is why it is worth paying a lawyer for 3-4 hours of time to go over it (not the company lawyer - see 'the social network')