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Employee Stock Purchase Plan

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I know this is the "ESOP" board, but this seemed to be the most appropriate place for this question.

The regulations under 1.423 state that an ESPP must provide that options can be granted to employees of the corporation or to employees of a related corporation. This seems to suggest that offerings to employees of related corporations is optional, but it is not perfectly clear to me. Can you exclude the employees of related corporations, and if so, where can I find that authority?

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