X Partner Proposal Draft

• Company Status

1. 1. Founded in July 2016
   2. Invested in $25,000
   3. Current shareholders: Y 50%, Z (Y’s Wife) 50%

• Company Revenue/Profit (Year starts at August)

1. 1. Note: we have never formally kept the numbers so these are just estimates, but the numbers should be very accurate since I am the only one that is involved in most of these.
   2. Year 2016-2017
      1. Education & Software Development Consulting
      2. ~$40,000 Revenue / ~$15,000 Profit
   3. Year 2017-2018
      1. Education Only
      2. Coding classes: ~$95,000 Revenue / ~$35,000 Profit
      3. Online classes: ~$9,000 Revenue / ~$8,000 Profit
      4. Individual projects: ~$10,000 Revenue / ~$9,000 Profit

• Bringing X on Board

1. 1. I have been seeking for a good partner since day 1 of the company. Since it is an important decision, I have been very cautious.
   2. Over the past 2 years, I have hired over 15 part-time instructors or other roles. X is a special one, with his ability to execute things, solve problems, and manage things with discipline. X’s responsibility and maturity also impressed me a lot. I believe that X could be a very valuable factor for Company A to grow in the coming years.
   3. The offer to bringing X on board contains 2 parts: salary + equality.
   4. Salary: X will be paid for the exact hours spent on teaching / site managing / training at $25/hr. With the regular school year, ~10 hrs should be available for each week.
   5. Equality: At the end of the July 2019, X will be given 3% equity of the company; at the end of the July 2020, X will be given another 3% equity of the company if X decides to continue the work, either part-time or full-time is fine; remote work is also fine, which supports X to continue his graduate study.
   6. The year 2 equality and salary could be re-negotiated if X decides to work full-time.
   7. The major role of X in the coming 2 years would be to help build the standardized hiring/training/curriculum/teaching system, so that the company can scale in a faster pace. Ultimately, Company A should operate well without Y or X.

• About the Equity - Dividend

1. 1. At the end of each year, the total profit generated during that year will be calculated as the base for dividend. Each partner will get the dividend based on the equality.  
   2. When the profit is less than $100,000, each partner could cash out all the dividend based on the percentage.
   3. When the profit is greater than $100,000, 30% of the profit will be returned to the company pool as the development fund for the future, and the rest 70% of the profit will be given as dividend.

• About the Equity - Acquisition/IPO

1. 1. If the company is sold or acquired, all the partners get their equity shares immediately.
   2. IPO is the same, although this will be a long way to go.