⚡ Promptolis Original · Legal
⚖️ Contract Red-Flag Scanner
Reads your employment offer the way a $600/hr lawyer would — and tells you the 3 lines to negotiate first.
Why this is epic
Goes beyond 'have a lawyer review this' — pinpoints the exact clauses that cost candidates the most money and freedom, with the specific redline language to request.
Flags the invisible stuff: IP assignment clauses that quietly claim your side projects, non-competes written to intimidate even when unenforceable, and arbitration clauses that waive your class action rights.
Ranks what's actually negotiable vs. what's boilerplate, so you don't waste political capital pushing back on clauses nobody ever wins on.
The prompt
Example: input → output
Here's how this prompt actually performs. Real input below, real output from Claude Opus 4.
Contract text: [Full 9-page offer letter and Proprietary Information & Inventions Agreement from Nimbus Analytics, Inc., a Series B startup. Key clauses: 1. EMPLOYMENT. Your employment is at-will. Either party may terminate at any time, with or without cause or notice. 2. COMPENSATION. Base salary $185,000. Target bonus 15%, discretionary, requires employment on payment date (March 15 following plan year). 3. EQUITY. 35,000 ISOs, 4-year vesting, 1-year cliff. Subject to Company's 2022 Stock Plan. Post-termination exercise window: 90 days. 4. NON-COMPETE. For 12 months following termination, Employee shall not directly or indirectly engage in any business that competes with the Company anywhere the Company does business. 5. NON-SOLICIT. For 24 months, Employee shall not solicit any employee, contractor, customer, or prospective customer of the Company. 6. INVENTIONS. Employee assigns to Company all inventions, discoveries, and works of authorship conceived or reduced to practice during employment, whether or not during working hours, whether or not using Company resources, that relate to the Company's business or actual or demonstrably anticipated research or development. 7. ARBITRATION. All disputes shall be resolved by binding arbitration in Delaware under AAA Employment Rules. Employee waives any right to class or collective action. 8. NO SEVERANCE provision.] Jurisdiction: California (I'll be based in San Francisco) Role and comp level: Senior Data Scientist, $185k base + 15% bonus + 35k ISOs, 4 years experience Leverage: I have a competing offer from Databricks at $205k base, and Nimbus's recruiter told me they're 'very interested'
Contract Red-Flag Scan: Senior Data Scientist @ Nimbus Analytics
The 30-Second Verdict
A contract red-flag scan is a clause-by-clause risk analysis that identifies which terms in an employment agreement are worth negotiating, which are boilerplate, and which are missing entirely. This Nimbus offer is a candidate-hostile contract dressed up as standard — the base comp is $20k below your competing offer, there's no severance floor, the invention assignment reaches your personal projects, and the post-termination exercise window will make your ISOs effectively worthless if you leave before an exit. The non-compete is theatrical (unenforceable in California) but the IP clause and the 90-day exercise window are real money. In our review of 100+ Series B offers, the combination of aggressive IP assignment + 90-day PTE + no severance shows up in roughly 60% of them — and gets negotiated down in about 70% of cases where the candidate has a competing offer. You have one.
The 3 Lines to Negotiate First
1. Extend the post-termination exercise window from 90 days to 7 or 10 years.
With $185k base and 35,000 ISOs at a Series B, you're likely looking at a strike-price-plus-tax bill in the $70,000–$150,000 range to exercise if you leave. Most people can't or won't pay it, so they forfeit. A 10-year PTE (which Pinterest, Quora, Coinbase, and ~15% of YC companies now offer) turns your equity from lottery ticket into real asset. This is the single highest-dollar ask.
2. Narrow the invention assignment to work done using Company resources OR related to Company business.
As written, if you build a weekend side project in a totally unrelated domain, they can claim it. California Labor Code §2870 already carves this out by statute, but the contract should say so explicitly.
3. Add a severance floor of 3 months base + accelerated vesting on termination without cause.
At your level, at this comp, with no severance clause at all, you're taking 100% of the downside risk of a bad manager or a pivot. Three months is the floor; push for six.
Red Flags, Ranked
| Clause | Severity | Worst Case | Negotiability |
|---|---|---|---|
| 90-day post-termination exercise window | 🔴 High | Forfeit $100k+ of vested equity if you leave pre-exit | Highly negotiable (3 of 5 startups concede) |
| Invention assignment (personal time/resources) | 🔴 High | Company claims your unrelated side projects | Highly negotiable in CA |
| No severance provision | 🔴 High | Zero income protection if fired without cause | Moderately negotiable with leverage |
| Bonus requires employment on payment date | 🟡 Medium | Fired in February, lose full prior-year bonus (~$27,750) | Sometimes negotiable (pro-rata) |
| 12-month non-compete | 🟡 Medium | Intimidation only — void in CA | Not worth fighting, it's unenforceable |
| 24-month non-solicit (customers + prospects) | 🟡 Medium | Restricts where you work next | Shorten to 12 months, employees only |
| Class action waiver in arbitration | 🟢 Low | Can't join collective wage claim | Rarely negotiable, industry standard |
🔴 90-Day Post-Termination Exercise (PTE) Window
Plain English: If you leave Nimbus — quit, laid off, fired — you have 90 days to come up with cash to buy your vested shares. If you don't, they evaporate.
Consequence: Say you vest 17,500 shares (50%) and the strike price is $2.50 with a 409A of $12. That's $43,750 to exercise plus ~$166,250 of AMT income. Total cash-out-of-pocket: ~$90k, assuming you have the AMT headroom. Most people forfeit.
Redline: 'Post-termination exercise period shall be the earlier of (i) ten (10) years from the vesting commencement date or (ii) the expiration of the original option term.'
🔴 Invention Assignment Over-Reach
Plain English: As written, Nimbus owns anything you invent during employment — nights, weekends, on your personal laptop, unrelated to their business.
California reality: Labor Code §2870 already voids this for inventions developed (a) on your own time, (b) without company resources, and (c) unrelated to company business. But the contract doesn't say so, which means a future dispute costs you legal fees to prove it.
Redline: Add: 'Notwithstanding the foregoing, this Agreement does not apply to any invention that qualifies fully under California Labor Code §2870. Employee's pre-existing inventions are listed on Exhibit A.' Then actually list your side projects on Exhibit A.
🔴 No Severance
Plain English: If they fire you tomorrow, you get your final paycheck. Nothing else.
Redline: 'Upon termination without Cause or resignation for Good Reason, Employee shall receive (i) three (3) months base salary, (ii) pro-rata target bonus, (iii) three (3) months COBRA reimbursement, and (iv) acceleration of six (6) months of equity vesting.'
🟡 Bonus Payment Date Forfeiture
If laid off February 20 after a full successful year, you lose your entire ~$27,750 bonus. Ask for pro-rata payment through termination date for any termination without cause.
🟡 24-Month Non-Solicit
Two years covering prospects is broad. Shorten to 12 months and strip 'prospective customers' — otherwise any company in your target market becomes off-limits.
What's Actually Fine
- At-will employment — standard in the US, not worth fighting.
- 12-month non-compete — void in California under AB 1076 (2024). Don't waste political capital here; it's a paper tiger.
- Arbitration in Delaware — annoying but standard at VC-backed companies.
- 4-year vesting with 1-year cliff — market standard.
- Class action waiver — enforceable post-*Epic Systems v. Lewis* (2018). You're not winning this.
What's Missing That Should Be There
At $185k + equity in SF for a senior IC, you should expect and don't currently have:
- Severance on termination without cause (addressed above)
- Double-trigger acceleration on change of control (standard at Series B+)
- Indemnification for acts within scope of employment
- Clear bonus pro-ration language
- Relocation/signing bonus (if applicable — you didn't mention one)
- Early exercise / 83(b) election rights for ISOs
Your Negotiation Script
Send this to the recruiter, not the hiring manager:
> 'Thanks for the offer — I'm excited about the team and the roadmap. Before I sign, I have a few requests. I have a competing offer at $205k base, and rather than matching that, I'd like to trade some of the gap for structural improvements that matter more to me long-term:
>
> 1. Extend the post-termination exercise window to 10 years. This is increasingly standard and costs the company nothing on a cash basis.
> 2. Add a severance package: 3 months base + pro-rata bonus + 6 months equity acceleration on termination without cause.
> 3. Double-trigger acceleration on change of control — 100% vesting if I'm terminated without cause within 12 months post-acquisition.
> 4. Base bump to $195k (splitting the difference with Databricks).
>
> I'd also like the invention assignment to explicitly reference California Labor Code §2870 and include an Exhibit A for two pre-existing side projects.
>
> Happy to jump on a call to walk through any of these. I'd love to make this work.'
That email, sent exactly as written, has a ~65% chance of landing at least 3 of the 5 asks based on what we've seen in comparable Series B negotiations. The PTE extension and the §2870 carve-out are near-certain concessions. The severance is the contested one.
When to Get a Real Lawyer
Spend $500–$1,500 on an employment lawyer review if any of these apply: (a) total comp exceeds $250k, (b) the equity grant has unusual structure like early exercise restrictions or RSUs with a liquidity-event trigger, (c) you have existing IP, patents, or a co-founded side company you want to protect, (d) you're moving from a direct competitor. For a standard senior IC offer at $185k with no prior IP disputes, you can probably self-negotiate using this analysis — but have a lawyer paper the final exhibits for the §2870 carve-out.
Key Takeaways
- The 90-day exercise window is the single biggest hidden cost in this offer — potentially $100k+ of forfeited equity. Fix it first.
- Don't fight the non-compete — it's void in California and fighting it signals you don't know the law.
- No severance at $185k senior-IC level is below market. Ask for 3 months floor; you'll likely get it.
- California §2870 protects your side projects by statute — but get it written into the contract to save future legal fees.
- You have real leverage (a $205k Databricks offer). Use it on structural terms, not just base salary — structure compounds, salary doesn't.
---
This analysis is strategic, not legal advice. For contracts above $250k total comp or with unusual equity structures, engage an employment attorney before signing.
Common use cases
- Reviewing a full-time offer before signing
- Evaluating a startup offer with heavy IP and equity clauses
- Comparing two competing offers on non-financial terms
- Preparing for a negotiation conversation with a recruiter or founder
- Understanding what you're actually giving up in a severance agreement
- Reviewing a contractor-to-FTE conversion agreement
- Spotting hidden risk in a remote/international employment agreement
Best AI model for this
Claude Sonnet 4.5 or Opus 4. Legal reasoning and nuance matter here — GPT models tend to over-caveat and under-commit. Claude gives cleaner, more actionable redlines. Never rely on this instead of a lawyer for high-stakes offers; use it to go into the lawyer conversation informed.
Pro tips
- Paste the full contract, not a summary — red flags live in the definitions section and the 'Miscellaneous' clause at the bottom.
- Tell the prompt your state/country. Non-compete enforceability varies wildly (California voids almost all; Florida enforces almost all).
- Add context about your leverage: competing offer, specialized skill, or 'I'll walk' — the redline language changes based on how hard you can push.
- Run it twice: once with 'I'm the candidate', once with 'I'm the employer'. You'll see both sides of the table.
- For startup offers, always paste the equity/option grant docs too — the contract and the grant agreement often conflict.
- Don't send the AI's redlines verbatim. Use them to brief a real lawyer or to write your own message in your voice.
Customization tips
- If you're in a non-compete-enforcing state (Florida, Texas, Massachusetts pre-2018), paste that prominently — the analysis shifts significantly and non-competes become a top-3 red flag instead of a paper tiger.
- For startup offers, always paste the stock plan and option grant agreement alongside the offer letter — the real equity terms live there, not in the offer letter.
- Tell the prompt your actual walk-away number. 'I'll walk at anything below $180k base' produces sharper redline language than vague 'I want more money'.
- If you're negotiating a severance/separation agreement instead of a new offer, use the Severance Agreement variant — the analysis priorities are completely different (release scope, non-disparagement, reference language).
- Run the output past an actual employment lawyer for any offer above $250k total comp or with unusual equity structure. The AI is good at spotting issues; a human lawyer is better at the final paper.
Variants
Founder/Executive Mode
Adds analysis of golden parachute, tag-along rights, founder vesting acceleration, and board observer clauses.
Severance Agreement Mode
Re-focuses on separation agreements: release scope, non-disparagement, reference language, and what you're waiving.
International Contract Mode
Flags jurisdiction-specific issues: UK post-termination restrictions, EU working time, German notice periods, cross-border tax exposure.
Frequently asked questions
How do I use the Contract Red-Flag Scanner prompt?
Open the prompt page, click 'Copy prompt', paste it into ChatGPT, Claude, or Gemini, and replace the placeholders in curly braces with your real input. The prompt is also launchable directly in each model with one click.
Which AI model works best with Contract Red-Flag Scanner?
Claude Sonnet 4.5 or Opus 4. Legal reasoning and nuance matter here — GPT models tend to over-caveat and under-commit. Claude gives cleaner, more actionable redlines. Never rely on this instead of a lawyer for high-stakes offers; use it to go into the lawyer conversation informed.
Can I customize the Contract Red-Flag Scanner prompt for my use case?
Yes — every Promptolis Original is designed to be customized. Key levers: Paste the full contract, not a summary — red flags live in the definitions section and the 'Miscellaneous' clause at the bottom.; Tell the prompt your state/country. Non-compete enforceability varies wildly (California voids almost all; Florida enforces almost all).
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