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If you had the outstanding shares and preferences in the options agreement wouldn't you have to have everyone resign every time someone exercised their options (changing the number of outstanding shares) or they raised money?

However I agree founders should be up front about the financial/investor makeup of the company.

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I got my options agreement which said I was entitled to N options at P price. No other information was provided, so not sure how I'm supposed to value them other than $0.

I assume that the options are intended for people that are bad at math.

>I assume that the options are intended for people that are bad at math.

It does appear to be a way to get employees for cheaper than market rates by taking advantage of an arbitrage in employee lack of understand of the financial and legal issues concerning stocks.

The size of the options pool is good enough. You don't need to know the exact number of shares; plus or minus 10 percent is fine.

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