PRICING POLICY
DESCRIPTION OF SERVICES/FEES
Company will render the following Services to Client, at Client’s explicit request and discretion:
a) Perform all the necessary transfers of data, information, processes or knowledge from Client’s current service provider if any, or from Client if contracted services
b) Perform all financial reviews, reconciliations, accounting and financials clean-up and/or adjustments needed, consistently with Client’s request
c) Subscribe to and setup all necessary software, system, platform or service to perform and maintain client’s accounting, payroll, treasury, tax, and other finance functions, as approved by client.
d) Perform bookkeeping and accounting for Client to reflect all transactions into Client’s books per Client’s documents such as, but not limited to receipts, invoices, or statements, according to U.S. Generally Accepted Accounting Principles (US GAAP).
e) Manage Client’s accounts receivable, by invoicing revenue generated to Client’s customers, collecting revenue when due, and reporting on accounts receivable aging and collection.
f) Manage Client’s accounts payable, by recording Client’s vendor invoices, insuring that they are paid on time, and reporting on accounts payable aging and collection.
g) Manage Client’s payroll, paying all employees on time, as well as paying payroll and withholding taxes, and sending payroll or contractor forms as appropriate, including, but not limited to W-2, W-4, W-8, W-9, and 1099 forms.
h) Closing Client’s books every month, and producing monthly balance sheet, income, and cash flow statement.
i) Managing Client’s government and/or private grants, and insuring compliance with all applicable laws, regulations, and accounting standards, as well as grantors’ restrictions, as needed.
j) Performing any CFO services per Client’s needs and requests, including, but not limited to financial analysis, financial modeling, planning, treasury management, strategic planning, and fundraising support, as described in Company’s service overview and pricing, hereinafter as Exhibit C.
k) Preparing, and filing federal, Delaware, and California tax returns as needed, starting with the 2018 tax year.
l) Providing any administrative support services per Client’s need, including, but not limited to calendar and e-mail management, travel scheduling, coordination, and booking, HR and payroll records management, access and documents management, research, fundraising coordination, web presence and social media platforms management, social media postings, and internal web site updates.
m) Providing Domiciliation services per Client’s need, including, but not limited to providing Client with an official address, reception of all tax, and official correspondence
n) Providing office virtualization services per Client’s need, including, but not limited to providing mail collection and processing services, deposit checks, scan incoming mail, shred or store physical documents and make their scanned copies available to Client or Client’s designates online in pre-defined folders and access control as needed by Client
o) Providing any other services and support, per Client’s needs and requests as described in Company’s service overview and pricing, hereinafter as Exhibit C.
COMPENSATION
1) The hourly billing rate for Services described in a) to c) above, is $67 in addition to the subscription or purchase cost of the software, system, platform or service required at cost, billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
2) The hourly billing rate for Services described in d) above, is $29 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
3) The hourly billing rate for Services described in e), and F) above, is $38 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
4) The hourly billing rate for Services described in g), is $46 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
5) The hourly billing rate for Services described in h) above, is $67 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
6) The hourly billing rate for Services described in i) above, is $78 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
7) The hourly billing rate for Services described in j) above, is $186 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
8) The billing rate for Services described in k) above, is $78 per hour billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
9) The billing rate for Services described in l) above, is $190 for 5 hours per month, $350 for 12 hours per month, $620 for 20 hours per months, and $1,580 for an unlimited number of hours by one Full-Time Equivalent (FTE) per month, billed at the beginning of the month, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%, and with unused hours in a given month rolling over to the following month.
10) The billing rate for Services described in m) above, is $48.95 per month, billed at the beginning of the month, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
11) The hourly billing rate for Services described in n) above, is $28 billed monthly, of which $0 shall be payable in shares of Client’s Preferred Capital Stock at a discount rate of 10%.
12) The billing rate for Services described in o) above, is as described in Company’s service overview and pricing, hereinafter as Exhibit C, or as agreed upon, in writing, by the Parties.
Note that the Company occasionally adjusts their billing rates and prices. In such case, the Company shall send notice to Client about the price change at least 30 days in advance of any scheduled price or rate change.
Discount Price means the price per share of the Standard Preferred Stock sold in the Equity Financing, or of the Common Stock if no Standard Preferred Stock is sold in the Equity Financing, multiplied by one (1) minus the Discount Rate (discount price = stock price * (1-discount rate).
Client will issue shares of Client’s Standard Preferred Stock to the Company in the event of:
a) Valuation, meaning that if there is a certified 409A valuation, Client will automatically issue to the Company the number of shares accrued corresponding to the percentage of the Services performed by the Company accrued according to this agreement as payable in shares of Client’s Standard Preferred Capital Stock, at the discounted rate agreed upon.
b) Equity Financing, meaning that if there is an Equity Financing, Client will automatically issue to the Company the number of shares accrued corresponding to the percentage of the Services performed by the Company accrued according to this agreement as payable in shares of Client’s Standard Preferred Capital Stock, at the discounted rate agreed upon.
c) Equity distribution, including but not limited to the distribution of incentive stock, or Equity Rights Distribution, including but not limited to the distribution of incentive stock options, or the financing of Convertible Notes, Warrants, or any instrument granting right to purchase or obtain shares of stock of Client.
d) Liquidity Event, meaning that if there is a Liquidity Event, the Company will, at its option, receive either (i) a cash payment equivalent to the Services performed by the Company accrued according to this agreement as payable in shares of Client’s Standard Preferred Capital Stock, or (ii) automatically issue to the Company the number of shares accrued corresponding to the percentage of the Services performed by the Company accrued according to this agreement as payable in shares of Client’s Standard Preferred Capital Stock, at the discounted rate agreed upon.
e) Dissolution Event, meaning that if there is a Dissolution Event, Client will pay to Company a cash amount equal to the Services performed by the Company accrued according to this agreement as payable in shares of Client’s Standard Preferred Capital Stock, due and payable to the Company immediately prior to, or concurrent with, the consummation of the Dissolution Event. The Purchase Amount will be paid prior and in preference to any Distribution of any of the assets of the Company to holders of outstanding Capital Stock by reason of their ownership thereof.
ZAZMIC FINANCE SERVICES OVERVIEW AND PRICING
Service Overview
I. Accounting Services
Bookkeeping: All accounting entries based on transactions sent by client (expense, receipts, invoices, bank statements, etc.), based on U.S. GAAP,
$29 per hour billed monthly
Receivable: Customer management, customer invoicing, collection, and reporting,
$38 per hour billed monthly
Payable: Vendor management, internal approval process, vendor payment, and reporting, also includes staff expense reimbursement
$38 per hour billed monthly
HR/Payroll: Staff and contractors contracts, on-boarding, full payroll service and benefits management, shadow U.S. payroll for expatriates, including federal and state payroll and withholding taxes calculation and payment, state and federal forms (W-2, W-4, W-8, W-9, 1099, etc.) preparation and filing, billed as Bookkeeping for 3 employees or less (including contractors paid through the payroll cycle),
$46 per hour billed monthly
Period End Close: Close of books for the period, includes revenue recognition, capitalization/depreciation, revenue and costs of sales deferrals, pre-paid expenses allocations, OPEX/Cost of Sales allocations, reconciliation of balance sheet accounts, foreign or domestic subsidiaries consolidations, U.S GAAP adjustments.
$67 per hour billed monthly
Financial Management and Controls: Month-end close reporting standard financial statements (balance sheet, income statement, cash flow statement) with variance analysis, and discussion/presentation of financial performances per reporting line (for whole organization, line of business, division, department, etc.). Prior periods clean-up in preparation for due diligence, establishing chart of account supporting company-specific departments, market segments, or customer reporting. Establishing and documenting of processes, policies, and proper controls. Review and drafting of contracts.
$67 per hour billed monthly
Grant/Government Contracts Management and Reporting (applicable for non-profits and organizations with government contracts): Management of grants financials and fund accounting per grantor’s requirements (government agencies, foundations, corporations, etc.), with regulatory and management reporting, including variance analysis, and discussion/presentation of financial performances per grant (for each grant, agency/grantor, line of products/services, etc.). Establishing and documenting of grant processes, policies, and proper controls. Management of grants agreement for contractors and sub-awardees, grant invoicing and cash flow.
$78 per hour billed monthly
II. CFO and Tax Services
Financial Analysis: Review of month-end close reporting and financial performances, analysis of all monthly statements, reports, and reconciliations, variance analysis standard financial statements (balance sheet, income statement, cash flow statement) with variance analysis and threat/opportunity reporting,
$186 per hour billed monthly
Financial Modeling: Design and development of full, dynamic financial model, with revenue, costs, and expenses assumptions and on-the-fly dynamic adjustments, with growth modeling, and 5 years of monthly projections, including financials, headcount, customers, cash flow,
$186 per hour billed monthly
Planning: Full management of the planning process, including development of models, input templates, discussion/negotiations of results, and final reports, for each planning cycle,
$186 per hour billed monthly
Treasury Management: Full management of treasury, weekly cash flow modeling and forecasting, banking facilities RFP and negotiation support, cash flow and treasury optimization analysis he planning process, including development of models, input templates, discussion/negotiations of results, and final reports, for each planning cycle,
$186 per hour billed monthly
Strategic Planning & Fundraising Support: Development of strategy, preparation/adaptations of financial models for investors, development of business plan and investor deck, adaptation of presentation material (investor deck, development packet, etc.), enterprise value/future capitalization modeling and pricing, road-show support, networking, cultivation, presentation, term-sheet negotiation support, investor on-boarding and relations,
$186 per hour billed monthly
Taxes: Federal, State, and local corporate and franchise taxes, regulatory filings, tax audits preparation, tax audits management,
$78 per hour billed monthly
III. Administrative Services
Administrative Assistant Services: Dedicated administrative assistant for calendar/schedule/travel management,
Administrative Support: Presentations and org charts preparation, HR and payroll records management, access and documents management, research, fundraising coordination,
Web Presence: Web presence and social media platforms management, social media postings, internal web site updates
All Administrative and Digital Services billed on a subscription basis, by month of service, with unused hours rolling over, at
$190 for 5 hours per month
$350 for 12 hours per month
$620 for 20 hours per month
$1,580 for unlimited service by one full-time equivalent (FTE)
Domiciliation: Providing your company with an official address, both physical, and PO Box, reception of all tax, and official correspondence,
Domiciliation Services are billed by month of service, on a subscription basis, at $48.95 per month
Virtual Office Management Services: Ideal for distributed offices, or people traveling extensively, giving you the peace of mind to know that wherever you are, you will never miss an important letter, a tax or regulatory notice, a utility bill or vendor invoice not available on-line, or a check. We provide mail collection and processing service, deposit checks, scan all the incoming mail, shred what you need securely disposed of, and store the rest, while all scanned documents are available on our cloud, to you or your designates, managing access in as many different folders as you need, to adapt access control to your needs.
$28 per hour billed monthly
IV. Client Estimate
In order to give Client the flexibility to assess and select Services according to their plans and budgets, we also attach a dynamic costing model so that Client can estimate of their average monthly costs. Note that this is an estimate, and the reality of Client’s operations can always necessitate a corresponding adjustment, and that, at the outset, it usually takes a little more time and effort to get all systems, processes, and operations started. Company’s estimates however are based on actual projects, and are not expected to deviate materially from the estimate
V. Pricing
Pricing is designed to be flexible and start-up friendly, offering three tiers of pricing: regular, equity partner, and investor.
Regular pricing is per the prices indicated, billed hourly, or at a negotiated package pricing and progressively increasing according to the company size in terms of annual revenue.
Equity partner pricing is determined as a life-time discount on our services against an equity investment in our client’s organization per the following scale:
1% equity = 5% discount, 2% equity = 10% discount, 3% equity = 15% discount,
4% equity = 20% discount, 5% equity = 25% discount
Subject to financial due diligence by Zazmic Finance, before the agreement takes place
Investor pricing is an opportunity for our client to pay up to 25% of our services in equity with a 10% discount rate on the equity. This pricing does not require any due diligence. The percentage of service paid in equity is determined at the beginning of the agreement, and can be adjusted monthly at the client’s discretion, the fees are then accrued, and resulting $ amount is converted into share at the next financing event.