Career Management and Search Se

Stock Options / Com

Revel's Stock Option Calculator is designed to help you understand the key terms of your options pack
Since your equity will hopefully become the largest portion of your compensation, it's critical you unders
Feel free to share it with others by sending the file or this

Visit www.reveltalent.com for other tools, including:

- Top Companies Tool: analysis on Silicon Valley's breakout companies
- Time to Move: review your progress and status at your current role
- Goals & Skills Profile: develop a strategy around your objectives, company criteria, and career plan

NOTE: Calculation Input Cells are grey and pre-filled with sample data

Questions to ask company Inputs

Number of options 10,000

Total number of outstanding shares 100,000,000

Your % ownership of company 0.01%

Strike Price $5.00

Equity Type ISO

Grant Date 2/1/15
Vesting Term (years) 4
Vesting Cliff (months) 12

Acceleration triggers
Restrictions on selling shares on secondary
markets

Questions to ask yourself Inputs

Strike price valuation $500,000,000

Exit Outcome (optimistic) $3,000,000,000

Probability 30%

Exit Outcome (medium) $1,000,000,000

Probability 40%

Exit Outcome (conservative) $ 500,000,000

Probability 30%

Compensation Summary Option Value

Expected Value of Options (4 years) $ 95,000
Expected Value of Options per year $ 23,750

Salary
Bonus 20%

Total Annual Compensation $ 203,750

See Vesting Schedule on next sheet

agement and Search Services for Top Technology Marketers

Stock Options / Compensation Calculator

y terms of your options package, calculate its expected value and negotiate from an informed perspective.
sation, it's critical you understand the details of how it works and its potential value.
hers by sending the file or this link:

ia, and career plan

 Option Value

$ 250,000

$ 50,000

$ -

Compensation

$150,000
$ 30,000
rvices for Top Technology Marketers

pensation Calculator

ge, calculate its expected value and negotiate from an informed perspective.
and the details of how it works and its potential value.
www.reveltalent.com/options-comp-calculator/

Need more help? We're happy to provide personal guidance.

Description

Total number of shares outstanding is required to calculate your % of ownership. Without this information, it
would be like having money but not knowing the currency.

Strike price sets the foundational valuation upon which your options begin to accrue value. In other words, you
participate in all growth after this point since it’s the value when you joined.
Employer offer incentive stock options (ISO) or non-qualified stock options (NQO). At larger companies, you
might get restricted stock units (RSU), which are not options, are easy to calculate and therefore not covered in
this model. ISO and NQO are similar type of options, but have different tax implications. Consult with a tax
professional and see link below for detailed information.

Vesting is typically over four years and you earn 1/48th each month employed

A cliff sets the minimum employment time before and options vest and is typically 12 months

Companies sometimes allow vesting to accelerate faster than normal if certain event(s) occur like an acquisition
and they downgrade your level often for executives only)
Some companies don't allow their equity to be sold on secondary markets (like SharesPost), or they require the
right of first refusal.

This is the implied valuation related to your strike price. These valuations are done on a regular basis or as
special events occur (like fundraising) in accordance with IRC Section 409b.

These are three potential outcomes you should consider for your company. What is the best, worst and middle
exits you estimate based on all available information. You can then weight them to account for differences in
their probability.

Expected value is the sum of the outcomes above, adjusted for the probably each will occur.
Since options typically vest over 4 years, this is the annual equivalent value of your options.

Your total expected income from all sources!

More detail on equity mechanics available here:

Venture Alley Equity Overview
 Stock Option

Year 1 Feb-15 Mar-15 Apr-15 May-15 Jun-15

Vested Value $ - $ - $ - $ - $ -

Year 2 Feb-16 Mar-16 Apr-16 May-16 Jun-16

Vested Value $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

Year 3 Feb-17 Mar-17 Apr-17 May-17 Jun-17

Vested Value $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

Year 4 Feb-18 Mar-18 Apr-18 May-18 Jun-18

Vested Value $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

Total Value

Feb-16 is a great time to review your career plan and make sure your company is no
 Stock Option Vesting Schedule

Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16

$ - $ - $ - $ - $ - $ - $ -

Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17

$ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18

$ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19

$ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979 $ 1,979

ure your company is not holding you back. Revel's Time to Move Calculator can help
Cliff Shares Total
$ 23,750 $ 23,750

$ 23,750

$ 23,750

$ 23,750

$ 95,000