Around The Table

At Carta, we call these pourovers. You might refer to them as plan settings, roll overs or adjustments to Shares Available for Grant. An option plan pourover occurs when the available shares from one option plan are poured over into another option plan. This often occurs with the formation of a new equity plan. Typically, any options that expire or are forfeited from the previous plan will now return to the new plan. 

In order to implement a pourover, you will need to contact Carta support. Before you contact support, you should have the following information:

1. A copy of the new equity plan
2. The new equity plan created in Carta
3. Number of shares from the old plan that will pour over into the new plan
4. Effective date of the pourover.

How to avoid cap table errors
Pourovers can cause cap table errors if certain actions are taken after the pourover. You can avoid them by:

1. Completing all terminations prior to the pourover. Shares will not return properly if a stakeholder is terminated after the pourover is done with a date before the pourover.
2. Do not amend or change the plan size after linking plans with a pourover. 

Setting up a pour over
If the available shares in the old plan do not pour over to the new plan, then it is necessary that you add a new amendment to the plan as of the effective date of the pour over excluding them from the old plan.

It is also important to highlight that after the pour over is linked, the platform updates the available shares in the new plan as shares pour over. The old plan's plan size will remain the same and not be reduced, as well as the new plan's plan size will not be increased.

If you have more questions or comments on this topic, reply to this thread by selecting the reply button next to the post.
If you have product feedback on this topic, submit it here.

At Carta, we call these pourovers. You might refer to them as plan settings, roll overs or adjustments to Shares Available for Grant. An option plan pourover occurs when the available shares from one option plan are poured over into another option plan. This often occurs with the formation of a new equity plan. Typically, any options that expire or are forfeited from the previous plan will now return to the new plan. 

In order to implement a pourover, you will need to contact Carta support. Before you contact support, you should have the following information:

1. A copy of the new equity plan
2. The new equity plan created in Carta
3. Number of shares from the old plan that will pour over into the new plan
4. Effective date of the pourover.

How to avoid cap table errors
Pourovers can cause cap table errors if certain actions are taken after the pourover. You can avoid them by:

1. Completing all terminations prior to the pourover. Shares will not return properly if a stakeholder is terminated after the pourover is done with a date before the pourover.
2. Do not amend or change the plan size after linking plans with a pourover. 

Setting up a pour over
If the available shares in the old plan do not pour over to the new plan, then it is necessary that you add a new amendment to the plan as of the effective date of the pour over excluding them from the old plan.

It is also important to highlight that after the pour over is linked, the platform updates the available shares in the new plan as shares pour over. The old plan's plan size will remain the same and not be reduced, as well as the new plan's plan size will not be increased.

If you have more questions or comments on this topic, reply to this thread by selecting the reply button next to the post.
If you have product feedback on this topic, submit it here.

At Carta, we call these pourovers. You might refer to them as plan settings, roll overs or adjustments to Shares Available for Grant. An option plan pourover occurs when the available shares from one option plan are poured over into another option plan. This often occurs with the formation of a new equity plan. Typically, any options that expire or are forfeited from the previous plan will now return to the new plan. 

In order to implement a pourover, you will need to contact Carta support. Before you contact support, you should have the following information:

1. A copy of the new equity plan
2. The new equity plan created in Carta
3. Number of shares from the old plan that will pour over into the new plan
4. Effective date of the pourover.

How to avoid cap table errors
Pourovers can cause cap table errors if certain actions are taken after the pourover. You can avoid them by:

1. Completing all terminations prior to the pourover. Shares will not return properly if a stakeholder is terminated after the pourover is done with a date before the pourover.
2. Do not amend or change the plan size after linking plans with a pourover. 

Setting up a pour over
If the available shares in the old plan do not pour over to the new plan, then it is necessary that you add a new amendment to the plan as of the effective date of the pour over excluding them from the old plan.

It is also important to highlight that after the pour over is linked, the platform updates the available shares in the new plan as shares pour over. The old plan's plan size will remain the same and not be reduced, as well as the new plan's plan size will not be increased.

If you have more questions or comments on this topic, reply to this thread by selecting the reply button next to the post.
If you have product feedback on this topic, submit it here.

------------------------------
Thanks,
Kris Tsao Cachia
Cooley LLP

Original Message:
Sent: 01-27-2022 13:16
From: Greta Goldberg
Subject: Pourovers

@Kris Cachia - thank you for this thoughtful reply. I have circulated this message to some product managers at Carta.

I would also encourage you to add this as product feed​back in the community and encourage others in the community to comment on this thread or vote/ comment once it is entered as product feedback. 

@Kris Cachia - you an enter product feedback here.​​

------------------------------
Greta Goldberg

Original Message:
Sent: 01-26-2022 09:54
From: Kris Cachia
Subject: Pourovers

Hi Greta!

This is a timely discussion topic.  Over the couple of years, I have brought to Carta's attention the need to have pour over caps.  For example, an old plan terminates with 400K shares outstanding ("Returning Shares") and 100K available ("Available Pour Over") all of which is meant to pour into the new plan.  The new plan's pool reserve is set at 1M shares, inclusive of the 100K Available Pour Over and 400K Returning Shares, so 500K shares is part of the new pool.  Carta's workaround has been to adjust the old plan's pool size down to outstanding and adjust the new plan's pool size to make sure that Returning Shares do not inflate the 1M share limit.  This means that the initial new pool size doesn't list "1M shares" as reserved, but an entirely different number.  The workaround solution is to add language to both titles of the old and new plan that has "(Authorized shares is ______)."  I've been told that this has been escalated up and I've sent in feedback on this issue, but no resolution yet.  Just curious if anyone else has encountered this type of set up?

Thanks,
Kris Tsao Cachia
Cooley LLP

------------------------------
Kris Cachia

Original Message:
Sent: 01-25-2022 11:36
From: Greta Goldberg
Subject: Pourovers

At Carta, we call these pourovers. You might refer to them as plan settings, roll overs or adjustments to Shares Available for Grant. An option plan pourover occurs when the available shares from one option plan are poured over into another option plan. This often occurs with the formation of a new equity plan. Typically, any options that expire or are forfeited from the previous plan will now return to the new plan. 

In order to implement a pourover, you will need to contact Carta support. Before you contact support, you should have the following information:

1. A copy of the new equity plan
2. The new equity plan created in Carta
3. Number of shares from the old plan that will pour over into the new plan
4. Effective date of the pourover.

How to avoid cap table errors
Pourovers can cause cap table errors if certain actions are taken after the pourover. You can avoid them by:

1. Completing all terminations prior to the pourover. Shares will not return properly if a stakeholder is terminated after the pourover is done with a date before the pourover.
2. Do not amend or change the plan size after linking plans with a pourover. 

Setting up a pour over
If the available shares in the old plan do not pour over to the new plan, then it is necessary that you add a new amendment to the plan as of the effective date of the pour over excluding them from the old plan.

It is also important to highlight that after the pour over is linked, the platform updates the available shares in the new plan as shares pour over. The old plan's plan size will remain the same and not be reduced, as well as the new plan's plan size will not be increased.

If you have more questions or comments on this topic, reply to this thread by selecting the reply button next to the post.
If you have product feedback on this topic, submit it here.

------------------------------
Thanks,
Kris Tsao Cachia
Cooley LLP

Original Message:
Sent: 01-27-2022 13:16
From: Greta Goldberg
Subject: Pourovers

@Kris Cachia - thank you for this thoughtful reply. I have circulated this message to some product managers at Carta.

I would also encourage you to add this as product feed​back in the community and encourage others in the community to comment on this thread or vote/ comment once it is entered as product feedback. 

@Kris Cachia - you an enter product feedback here.​​

------------------------------
Greta Goldberg

Original Message:
Sent: 01-26-2022 09:54
From: Kris Cachia
Subject: Pourovers

Hi Greta!

This is a timely discussion topic.  Over the couple of years, I have brought to Carta's attention the need to have pour over caps.  For example, an old plan terminates with 400K shares outstanding ("Returning Shares") and 100K available ("Available Pour Over") all of which is meant to pour into the new plan.  The new plan's pool reserve is set at 1M shares, inclusive of the 100K Available Pour Over and 400K Returning Shares, so 500K shares is part of the new pool.  Carta's workaround has been to adjust the old plan's pool size down to outstanding and adjust the new plan's pool size to make sure that Returning Shares do not inflate the 1M share limit.  This means that the initial new pool size doesn't list "1M shares" as reserved, but an entirely different number.  The workaround solution is to add language to both titles of the old and new plan that has "(Authorized shares is ______)."  I've been told that this has been escalated up and I've sent in feedback on this issue, but no resolution yet.  Just curious if anyone else has encountered this type of set up?

Thanks,
Kris Tsao Cachia
Cooley LLP

------------------------------
Kris Cachia

Original Message:
Sent: 01-25-2022 11:36
From: Greta Goldberg
Subject: Pourovers

At Carta, we call these pourovers. You might refer to them as plan settings, roll overs or adjustments to Shares Available for Grant. An option plan pourover occurs when the available shares from one option plan are poured over into another option plan. This often occurs with the formation of a new equity plan. Typically, any options that expire or are forfeited from the previous plan will now return to the new plan. 

In order to implement a pourover, you will need to contact Carta support. Before you contact support, you should have the following information:

1. A copy of the new equity plan
2. The new equity plan created in Carta
3. Number of shares from the old plan that will pour over into the new plan
4. Effective date of the pourover.

How to avoid cap table errors
Pourovers can cause cap table errors if certain actions are taken after the pourover. You can avoid them by:

1. Completing all terminations prior to the pourover. Shares will not return properly if a stakeholder is terminated after the pourover is done with a date before the pourover.
2. Do not amend or change the plan size after linking plans with a pourover. 

Setting up a pour over
If the available shares in the old plan do not pour over to the new plan, then it is necessary that you add a new amendment to the plan as of the effective date of the pour over excluding them from the old plan.

It is also important to highlight that after the pour over is linked, the platform updates the available shares in the new plan as shares pour over. The old plan's plan size will remain the same and not be reduced, as well as the new plan's plan size will not be increased.

If you have more questions or comments on this topic, reply to this thread by selecting the reply button next to the post.
If you have product feedback on this topic, submit it here.