In general, it's referring to the fact that you should be very careful with what you write down.
For example, if you send an email to a potential employee that the 10,000 shares you are offering them are worth $10,000, you've effectively valued your stock at $1/share. Now if you try to go and give options at $0.02/share and claim that is "fair market value", if the IRS ever saw the original email you would be in a bad situation.
Re. the grammar, happy to fix it up as necessary, it was done in a very conversational style as I didn't think it would be this popular, and likely has ways that it can be improved for clarity. Let me know what/where can be improved and I'll fix it up
For example, if you send an email to a potential employee that the 10,000 shares you are offering them are worth $10,000, you've effectively valued your stock at $1/share. Now if you try to go and give options at $0.02/share and claim that is "fair market value", if the IRS ever saw the original email you would be in a bad situation.
Re. the grammar, happy to fix it up as necessary, it was done in a very conversational style as I didn't think it would be this popular, and likely has ways that it can be improved for clarity. Let me know what/where can be improved and I'll fix it up