Required Documents for Carta Onboarding
Welcome to Carta—your partner in streamlining the onboarding process and revolutionizing your equity management. As you embark on this journey, one of the key steps to ensure a seamless transition is gathering the essential company documents that form the backbone of your Carta experience. In this blog post, we'll guide you through the documents needed to kickstart your Carta journey, explaining their significance and why they're vital for your success.
The Required Documents
Let's dive into the specific documents that are essential for building the foundation of your Carta experience. We can break them down into four categories: cap table, equity plan documents, company documents, and debt documents.
Cap table/Stock Ledger:
This will be your current excel ledger with the most complete data regarding your cap table structure and history. For small companies that do not have that history detailed in excel we are able to extract the data from stock purchase agreements, just make sure they outline full terms like, holder name, email address, quantity of shares, issue date, etc.
Equity Plan Documents (we need these as blank templated documents):
Equity Incentive Plan: Think of this as the blueprint that outlines how equity is distributed among your team members. It spells out who can receive equity, how much they're eligible for, and the terms governing its allocation.
Stock Option Agreement: When you want to offer someone the opportunity to buy company shares at a predetermined price, this agreement lays down the rules. It's a promise of potential ownership.
Stock Option Grant Agreement: Consider this as a personalized invitation to become a part-owner of your company. It specifies critical details such as the number of shares granted, the exercise price, and other essential terms.
Option Exercise Agreement: When stakeholders decide to purchase the shares they were promised, this agreement details the transaction's ins and outs.
Form of RSU Agreements (if applicable): If your company has granted Restricted Stock Units (RSUs), these agreements lay down the terms and conditions of those grants. RSUs represent a promise of future stock.
Company Documents:
Certificate of Incorporation: This document is your company's official birth certificate. It legally establishes your company's identity by outlining its name, purpose, share structure, and other vital information.
Previous 409a reports (if applicable): Third party report establishing your company’s Fair Market Value (FMV) that will be used to issue option grants. For early stage companies, the options exercise price can also be established internally via a board consent.
Debt Documents (we need these as blank templated documents):
Form of Warrant Agreement: Warrants are like special keys that enable holders to buy shares at a predetermined price. This agreement sets out the terms for using these keys.
Form of SAFE Agreement: If your company has utilized Simple Agreements for Future Equity (SAFEs) to raise funds without immediately issuing shares, this agreement explains the arrangement's mechanics.
Form of Convertible Note Agreement: When your company borrows funds with a commitment to repay or convert it into shares later, this agreement specifies the loan terms and conversion process.
Where to Find These Documents
These documents typically reside within your company's legal and administrative records. Collaborate with your legal team, company secretary, or relevant personnel responsible for managing your company's corporate documentation to access these materials.
As you step into the world of Carta, remember that these documents pave the way for an organized, compliant, and effective equity management experience. For any queries or assistance, our community and your implementation manager is at your service, ready to guide you through every phase.