To manage equity within Group Structures using Carta's EMI Share plan documents, companies must first onboard the Top Company to the Carta's platform and have it adopt the Share Plan.
This step is required to meet the independence criteria for EMI-qualifying companies. You can read more about EMI qualifying criteria for Companies here.
Once the Top Company is onboarded and has adopted the Share Plan, it will handle option issuances and sign option agreements, including those issued to employees of Group Subsidiaries via the Carta platform.
However, when issuing options to Subsidiary employees, the employing Subsidiary - not the Top Company - must sign the s.431 election upon exercise, as this is a joint election made by the employee and their employing company.
In such cases, when opening exercise windows via the Carta platform, select the exercise document set without the s.431 election. Instead, complete the s.431 election outside of the Carta platform, using the employing Subsidiary’s information and signatory.
| A blank copy of the s.431 election template can be found attached to this article for download. |
Please complete this template with the employing Subsidiary’s information and execute it outside of the Carta platform if the employee is not employed by the issuing company.