Abstract
A method for automatically converting the equity accrual rate in a non-cash residential compensation agreement from a risk-discounted pre-financing formula to a market-validated post-money formula upon the occurrence of a qualifying financing event. The conversion eliminates the risk discount factor and substitutes the post-money valuation from the financing round, effective on the first calendar month following the close. Subsequent financing events update the governing valuation to the most recent post-money figure.
Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 License.
Recommended Citation
Burton, Aaron, "Automatic Equity Rate Conversion Upon Financing Events in Non-Cash Residential Compensation Agreements", Technical Disclosure Commons, (April 16, 2026)
https://www.tdcommons.org/dpubs_series/9818