[Hidden-tech] Warrant for Common Stock

andrew bellak andrew at stakeholdersinc.com
Fri Jan 19 13:21:58 EST 2007


Read,

 

I traded stock options (and occasionally warrants) on a stock exchange for
about 10 years.

 

I would echo what Anthony said.  I would also add that you need to spell out
your rights and exit / cash out terms whatever form your stake takes and of
course gauge the liquidity for that as well.  I have a lawyer based in
Westchester, NY who did my trading company agreements and was also an
options trader as well.  I'm happy to give you his contact info. if you
like.

 

Good luck,

Andrew

 



 

Andrew Bellak

President

Andrew at stakeholdersinc.com

413-549-4589 home / office

646-552-5783 mobile

"You must be the change you want to see in the world" - Mohandas Gandhi

-----Original Message-----
From: hidden-discuss-bounces at lists.hidden-tech.net
[mailto:hidden-discuss-bounces at lists.hidden-tech.net] On Behalf Of Anthony
Vlamis
Sent: Friday, January 19, 2007 10:29 AM
To: Read Predmore, Ph.D.; Hidden-discuss at lists.hidden-tech.net
Subject: Re: [Hidden-tech] Warrant for Common Stock

 

i don't have a lawyer recommendation but these documents are usually pretty
standard.  They allow you to purchase a share of common stock at a certain
price for a stated period of time--in other words they have expiration dates
which if passed render the warrant worthless--.  

If this is a public company -- traded on an exchange--you'll be able to
establish a current market value and then compare the stock price to the
warrant price and figure out how much it is worth in terms of present value.
if it is a private company then the warrant is pretty much valueless because
the values set for the company stock are completely arbitrary.  So if you
accept a warrant to say purchase a share of the company stock at $1.00 for a
term to expire in 5 years (go for the longest term possible) and they say
the stock is valued at $2.50 today that value can pretty much be decided by
the executive management over a cup of coffee that day.  

 

Again, public companies are not a problem because a real market valuation
has been established by a purchaser and seller.  All the rest is at best an
opinion and at worst a wish.

 

if it's possible to trade the paper for a right to purchase a percentage
interest in the business or earn it through  sweat equity (again, in a
private company situation) that would probably work out much better for you
in a success scenario.

 

this is MHO

 

Anthony Vlamis
Intellagent Communications Solutions
1775 Plank Road
Forestburgh,  New York 12777-6803
845-794-2930

 

 

 


 

----- Original Message ----- 

From: Read Predmore, Ph.D. <mailto:predmore at PredmoreAssociates.com>  

To: Hidden-discuss at lists.hidden-tech.net 

Sent: Friday, January 19, 2007 9:36 AM

Subject: [Hidden-tech] Warrant for Common Stock

 

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  _____  


19 January 2007

 

Happy New Year Everyone!

 

I am starting a consulting project with a startup company and am considering
a "Warrant for Common Stock" in lieu of part of my fee.  I would like
recommendation for a lawyer to review the "Warrant" and feedback from others
that have done this.

 

Thanks,

 

 

Read Predmore, Ph.D.

________________________________

 

Predmore Associates

413-549-8554

 <http://www.PredmoreAssociates.com> www.PredmoreAssociates.com

 <mailto:pread at PredmoreAssociates.com> read at PredmoreAssociates.com

________________________________

 

 


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