Note that there are a few alternatives to this. Fred Wilson, from Union Square Ventures (who pg wrote about it here[1]), gave a 1 hour class on the subject[2]. He covered tax and mechanisms to avoid taking unecessary invetment gains tax.

Another great post on this subject (which may be a bit dated nowadays) was this one[3]. Hacker News startup lawyer had also some great comments on its corresponding HN thread[4]. Note that it embeds the Introduction to Stock Options[5] that also had an amazing discussion on HN a few years ago[6]

[1] http://www.paulgraham.com/airbnb.html

[2] http://www.avc.com/a_vc/2012/04/mba-mondays-live-employee-eq...

[3] http://gigaom.com/2011/06/05/5-mistakes-you-cant-afford-to-m...

[4] https://news.ycombinator.com/item?id=2623182

[5] http://www.scribd.com/doc/55945011/An-Introduction-to-Stock-...

[6] https://news.ycombinator.com/item?id=3252290