Thanks, I got it.

[SystemA]

Stock option plan:

We are currently working with our CPA to define an Incentive Stock Option plan. Currently, our shares are being valued at $1 each based on treasury issuance of 10,000,000. There are 1,000,000 shares targeted for options.

Your position and skill would attract an option grant for 50,000 shares (worth $50,000 currently) to exercisable in 4 years.


谢！

 

[badboy88]

your boss give u 50,000 shares
u can not sell in less than 4 yeays

 

[闲得慌]

最初由 SystemA 发布
Do I need pay $50,000 for these share? Thanks!

You will be able to sell a portion or all of $50,000, depending on the policy. You do not need to pay the shares until you sell them.

You will not have to sell them in 4 years. For example, if the share price is down to cheaper than $1.00 in 4 years in your case, you will not be interested in selling them. You do not lose anything if you do not sell them.

It is called "option", for a reason.

 

[SystemA]

最初由 闲得慌 发布


You will be able to sell a portion or all of $50,000, depending on the policy. You do not need to pay the shares until you sell them.

You will not have to sell them in 4 years. For example, if the share price is down to cheaper than $1.00 in 4 years in your case, you will not be interested in selling them. You do not lose anything if you do not sell them.

It is called "option", for a reason.

Thanks very much.

Does this mean that if I would like to sell them after 4 years, I should pay $50,000 to company at first. My benifit would be (sell price - $1)*50,000. If sell price < $1 after 4 years, it will mean nothing to me. right? Who knows the current price? The share is not in stock market yet. Is this a real bonus from the boss?

 

[闲得慌]

最初由 SystemA 发布


Thanks very much.

Does this mean that if I would like to sell them after 4 years, I should pay $50,000 to company at first. My benifit would be (sell price - $1)*50,000. If sell price < $1 after 4 years, it will mean nothing to me. right? Who knows the current price? The share is not in stock market yet. Is this a real bonus from the boss?

Yes, this is a bonus from your boss. A lot of people became millionaires a few years ago because of this. Thinking about it, if the share price is $101 in 4 years, you will get 50,000 X (101-1) = $5,000,000!

Who knows!

 

[闲得慌]

BTW, you may become a negative millionaire because of this if you are in US and you are too greedy!

 

[SystemA]

最初由 闲得慌 发布
BTW, you may become a negative millionaire because of this if you are in US and you are too greedy!

I am not too greedy. I just would like to protect myself before the agreement signed.

If the sell price were less than $1 after 4 years, I wouldn't lose money if I don't sell it, right? If I leave this company within 4 years, these shares will be void, right?

Thanks

 

[闲得慌]

最初由 SystemA 发布


I am not too greedy. I just would like to protect myself before the agreement signed.

If the sell price were less than $1 after 4 years, I wouldn't lose money if I don't sell it, right? If I leave this company within 4 years, these shares will be void, right?

Thanks

You do not get or lose money if you don't exercise it. Period.
Note: "exercise " is different from "sell".

 

[SystemA]

最初由 闲得慌 发布


You do not get or lose money if you don't exercise it. Period.
Note: "exercise " is different from "sell".

Very good answer! Thanks very much.

It was said the current value is $1. Does this mean that I will only pay $1 each (limited 50,000) whenever after 4 years I excerise it?

 

[闲得慌]

最初由 SystemA 发布


Very good answer! Thanks very much.

It was said the current value is $1. Does this mean that I will only pay $1 each (limited 50,000) whenever after 4 years I excerise it?

Yes, but it may have a expiration date in your agreement.

 

[SystemA]

最初由 闲得慌 发布


Yes, but it may have a expiration date in your agreement.

Does this mean I should pay $50,000 for these share before the expiration date? Therefore, I must work hard to enhance the share value within a period. Right?

 

[badboy88]

最初由 SystemA 发布


Does this mean I should pay $50,000 for these share before the expiration date? Therefore, I must work hard to enhance the share value within a period. Right?

if you want to keep it,you have to pay,if you sell before expired date, you don't have to pay..

 

[SystemA]

最初由 badboy88 发布


if you want to keep it,you have to pay,if you sell before expired date, you don't have to pay..

Thanks very much 闲得慌 and badboy88! I got it.

 

[闲得慌]

最初由 SystemA 发布


Does this mean I should pay $50,000 for these share before the expiration date? Therefore, I must work hard to enhance the share value within a period. Right?

If you decide not to exercise the option, you should do nothing.
You were really tesing the edge of my patience.

 

[SystemA]

最初由 闲得慌 发布


If you decide not to exercise the option, you should do nothing.
You were really tesing the edge of my patience.

This company has a very bright future. The innovation will strongly impact on many important areas. The company will grow quickly within three years, so we have to work hard to enhance the value of the company currently. Anyway, I learn a lot from you, thanks!