Equity Compensation Reporting: Handbook of Key Terms · Weighted Average Vesting: This measures the amount of time from date of grant to each vesting tranche and weighs it based on

FOR PRIVATELY-HELD COMPANIES WITH STOCK OPTION PLANS

Equity Compensation Reporting A Handbook of Key Terms

Equity Reporting Simplified

Option Activity

Total Outstanding at Start of the Period Grants During the Period Exercises During the Period Forfeitures During the Period Expirations During the Period Total Outstanding at End of the Period Total Exercisable at End of the Period Total Vested or Expected to Vest at End of the Period Note 1 Note 2 Note 3

Expense Recognition

Projected Fair Value Expense Reported Prior to Period Projected Expense True-Up Amount Expense to Report Total Reported Expense Remaining Expense (aka Unrecognized Compensation) Weighted-Average Period to Recognize Unrecognized Compensation

Summary

About Corporate Focus

Connect With Us

23

24 25 26 27 28 29 30 31 32 33 34

35

36 37 38 39 40 41 42 43

44

45

46

1

2

3 4 5 6 7 8 9

10

11 12 13 14 15 16 18

19

20 21 22

Overview

A Valuation

Black-Scholes Formula Fair Market Value Exercise Price Expected Term Interest Rate Volatility Dividend Rate

B Expensing

Fair Value Per Share Actual Fair Value Requisite Service Period Forfeiture Rate Reporting Period Expensing Method Projected Fair Value True-Up

C Disclosures

Valuation Summary a Range b Weighted Average

Table of Contents

1 2 3 4 5 6 7

1 2 3 4 5 6 7

1

2

3

ab c d e f g hi j k

ab c d e f g h

Overview

Equity Reporting Simplified1

This Handbook is designed as an easy way to look up some of the basic terminology that anyone responsible for equity compensation reporting should understand in order to properly calculate and report the expense under ASC Topic 718 (formerly FAS 123R) For clarity and brevity we have limited these terms to those that would be most relevant to a privately-held company that has granted employee stock options There are many other cases that we do not focus on in this Handbook

As you will see the terms are organized into three categories

Once you understand the terms presented in these three sections you will have a better founda-tion to accurately report your equity compensation expense or if you are managing the process just to understand what are the right questions to ask of others

Terms that relate to valuation

Terms that relate expensing and

Terms that relate to reporting and disclosures

1

2

3

Before you can determine how much expense to take with respect to your non-cash equity compensation you need to first value the stock option grant First you need to value the option on the date of grant and then in the next section we discuss the terms related to expensing the options value over the service period The fair value of the stock option is most commonly determined for privately-held companies using the Black-Scholes-Merton formula The formula has a number of variables that are described in this section

A Valuation


In this version of the Black-Scholes formula the listed variables have the following meanings

d1 adjusts the stock price for risk d2 adjusts the exercise price for riskS means the fair market value K means the exercise priceT means the expected term r means the interest rateSigma means the volatility q means the dividend rate e = Standard exponential constant (2718hellip)

N() = Standard normal distribution function

1 Black-Scholes Formula


A Valuation gt Black-Scholes Formula

This is the fair market value on the date of grant of the underlying stock that the option converts into (ie Common Stock) For a privately-held company It is typically determined as part of a 409A valuation

2 Fair Market Value


A Valuation gt Fair Market Value

The exercise price is determined by the Board of Directors For a qualified incentive stock option the exercise price must not be less than the fair market value of the underlying stock on the date of grant

3 Exercise Price


A Valuation gt Exercise Price

There are several ways to do this but assuming you are a private company with little historical information FASB gives us a formula under SAB 107 as extended by SAB 110The formula is (Weighted Average Vesting + Contract Term)2

Contract Term This is simply the life of the grant If it is a 10-year grant then contract term = 10 If it is a 7-year grant then contract term = 7 Weighted Average Vesting This measures the amount of time from date of grant to each vesting tranche and weighs it based on the number of shares vesting

4 Expected Term


A Valuation gt Expected Term

In order to determine the interest rate to use for your option grant you need to do the following

5 Interest Rate


A Valuation gt Interest Rate

Go to the Federal Reserve Board site and download the Treasury Con-stant Maturities Note Some documentation indicates the need to use a Zero Coupon Rate Because the Treasury Rate is widely available and the results of using the Treasury Rate v Zero Coupon Rate is similar auditors will gen-erally accept the Treasury Rate This gives you forward looking rates for 1 2 3 5 7 and 10 years Match the expected term you generated to the year That gives you the interest rate to use in your Black-Scholes calculation If your expected term is 5 use the 5 year rate If your expected term is 6 you need to aver-age the rates for years 5 and 7 to get the appropriate rate for 6 years

1

2

3

Volatility means the amount that the returns of a stock price have changed over a specified period of time Since privately-held companies do not have a stock price that changes on a regular basis they typically base their estimated volatility on the histori-cal volatility of similar publicly traded companies or ldquopeer companiesrdquo Therefore the first step to calculate the volatility variable is to determine the set of publicly traded peer companies to use Typically you will need to select between 4 and 10 peer companies Then download the daily closing prices for these companies from a source such as Yahoo Finance And then calculate the volatility of their closing prices for the period equal to the expected term Volatility is calculated for each peer company by taking the standard deviation of the difference in the natural logarithms of the stock prices over the number of days in each trading year You will need to do this for each peer company you selected Then aver-age these rates together (or do a more advanced weighted-average) to determine the volatility

6 Volatility


A Valuation gt Volatility

A typical private company does not distribute dividends so this is normally 0

7 Dividend Rate


A Valuation gt Dividend Rate

Once you have determined the fair value of a stock option on its date of grant you then need to calculate how much of that value should be expensed in each reporting period This will be based on the expensing method that is used the projected forfeiture rate that is determined the portion of the reporting period that the option was outstanding and how much to true-up the expense for vesting events and forfeitures When you understand the terms in this section you will be better prepared to report the correct amount of equity compensation expense for the current reporting period

B Expensing


This is the value of the option calculated based on the Black-Scholes formula

1 Fair Value Per Share


B Expensing gt Fair Value Per Share

11

Fair Value Per Share x Number Granted = Actual Fair Value This value is the total amount we will expense for this option over its service period if the em-ployee does not terminate before the option is fully vested

2 Actual Fair Value


B Expensing gt Actual Fair Value

12

This is the time period over which you will expense the option grant When dealing with plain vanilla option grants this is based on the period the option vests For example if the optionrsquos vesting schedule is 25 per year for 4 years the requisite service period for this option is 4 years

3 Requisite Service Period


B Expensing gt Requisite Service Period

13

This is a projected annual rate that you expect options to be forfeited in the future Forfeited means options which are cancelled before they vest It does not include options that expire meaning options that are cancelled after they vest This rate is used to discount the amount of the actual fair value that is expensed in each reporting period Private companies with little or no histori-cal employee forfeiture data may need to look to a comparable rate such as the turnover rate at peer companies to determine a reasonable forfeiture rate (until you have your own sufficient historical data to use)

4 Forfeiture Rate


B Expensing gt Forfeiture Rate

14

This is the time period in which you will report your expense For example if the company reports annually and the fiscal year end is 1231 the reporting period for 2011 is 112011 ndash 12312011

5 Reporting Period


B Expensing gt Reporting Period

15

The amortization schedule for an option grant determines the amount of expense that will be taken in each reporting period This is calculated using an expense method and a forfeiture rate to discount (or ldquohaircutrdquo) the Actual Fair Value Typically there are 3 expensing methods used for privately-held companies When selecting an expensing method it is important to use one that will expense as much value as the number of options that have vested at any point in time (a key principle of ASC Topic 718) Re-gardless of which method you use if an option fully vests you will end up taking the same amount of expense over the entire service period

6 Expensing Method


B Expensing gt Expensing Method

16

Modified Straight-Line The modified straight-line expensing method (which I recom-mend) is based on the straight-line expensing method but adjusts for the requirement that you need to recognize at least the portion of the fair value as the option has vested to date This results in a slightly higher expense in earlier periods but ensures that you take enough expense under both graded and front-loaded option vesting schedulesRegardless of which method you use if an option fully vests you end up taking the same amount of expense over the entire service period

Continued

1

6 Expensing Method (continued)


B Expensing gt Expensing Method [continued]

17

FIN 28 (Accelerated Method) The accelerated expensing method treats each vest-ing tranche as a separate amortization period from grant date to vest date This results in the expense being front-loaded since expense from each vesting period is taken in the current reporting period Although this typically satisfies the FASB requirement referred to above of expensing at least the portion of the fair value as the option has vested to date it can have what some companies consider the nega-tive impact of a much greater expense being taken in earlier years and a much lower expense in later years

Straight-Line The straight-line expensing method is where you divide the projected fair value by the number of days in the requisite service period Using this method expenses the same amount in each reporting period The problem with using the straight-line method is that under many vesting schedules you may not satisfy the requirement referred to above of expensing at least the portion of the fair value as the option has vested to date

2

3

The actual amount expected to be expensed each period is called the Pro-jected Fair Value which is the Actual Fair Value reduced by the forfeiture rate This value is generated through the creation of the amortization schedule

When applying the forfeiture rate using a flat rate does not result in enough expense being taken each reporting period

Instead you should use an annualized rate with a dynamic forfeiture rate that uses the formula - (1-(forfeiture rate100)^service period) calculated for each vesting tranche where service period = of days between grant date and vest date

7 Projected Fair Value True-Up


B Expensing gt Projected Fair Value True-Up

18

In addition to determining how much equity compensation expense to include in your total compensation expense number there are also a number of disclosures required in the footnotes to the financial statements related to a companys option plans and equity compensation As you will see in this section there are many numbers that need to be reported in the footnotes to explain the option plan the options that are being granted and expensed how that amount of expense was determined and the range of values that was used When you have a basic un-derstanding of these terms you will be better prepared to properly prepare your equity compensation disclosures as required by ASC Topic 718

C Disclosures


For options granted in the current reporting period you need to disclose the ldquorangerdquo and ldquoweighted averagerdquo values for certain variables used in the Black-Scholes formula volatility interest rate expected term and dividend rate When you disclose the range and weighted average values for each of the four Black-Scholes variables as well as the range and weighted average values for fair value per share you will be disclosing a total of 10 numbers in the valuation summary section

1 Valuation Summary


C Disclosures gt Valuation Summary

To determine the range for each variable you need to disclose the lowest value and highest value used for each For instance if a 20 volatility was the lowest value you used when determining fair value for the options granted in the reporting period and a 30 volatility was the highest value for the same period the range you would disclose would be 20-30

a Range


C Disclosures gt Valuation Summary gt Range

21

To determine the weighted average for each variable you need to ldquoweightrdquo each variable based on the number of shares granted at each value The total number of shares granted is then divided by the sum of the weights to end up at the weighted average For instance if there is one grant for 1000 shares with a 25 volatility and another grant for 500 shares with a 30 volatility the weighted average volatility would be (251000) + (30500)1500 = 2667

b Weighted Average


C Disclosures gt Valuation Summary gt Weighted Average

22

For option activity in the current reporting period you need to disclose the number of options outstanding at the beginning of the period the option activ-ity during the period and several numbers related to the end of the period

2 Option Activity


C Disclosures gt Option Activity

This is the total number of options outstanding as of the beginning of the period If the reporting period is 112011 ndash 12312011 this is the total number of options outstanding at the end of the day on 12312010 The number outstanding at the start of the period will be Total Granted ndash Exercises ndash Forfeitures ndash Expirations

a Total Outstanding at Start of Period


C Disclosures gt Option Activity gt Total Outstanding at Start of Period

24

This is the total number of options granted during the period even if those grants were cancelled during the period

b Grants During the Period


C Disclosures gt Option Activity gt Grants During the Period

25

This is the total number of options exercised during the period

c Exercises During the Period


C Disclosures gt Option Activity gt Exercises During the Period

26

This is the total number of options that were cancelled prior to vesting during the period

d Forfeitures During the Period


C Disclosures gt Option Activity gt Forfeitures During the Period

27

This is the total number of options that were cancelled after vesting during the period

e Expirations During the Period


C Disclosures gt Option Activity gt Expirations During the Period

28

This is the total number of options outstanding at the end of the period The Total Outstanding at the end of the period is Total Outstanding (at start) + Grants ndash Exercises ndash Forfeitures ndash Expirations

f Total Outstanding at End of Period


C Disclosures gt Option Activity gt Total Outstanding at End of Period

29

This is the total number of options that are exercisable at the end of the period The Total Exercisable at the end of the period is the number of options that have vested ndash the number of options that have been exer-cised for outstanding option grants

g Total Exercisable at End of Period


C Disclosures gt Option Activity gt Total Exercisable at End of Period

30

h Total Vested or Expected to Vest at End of the Period


C Disclosures gt Option Activity gt Total Vested or Expected to Vest at End of the Period

31

The Total Vested or Expected to Vest at end of the period is the sum of the number vested + the number expected to vest

Total Vested - The number vested = the number that are exercisable at the end of the period You donrsquot use the number ldquovestedrdquo here because it is possible that a portion of the vested shares have been exercised You want to look only at the number of vested shares that can be exercised at the end of the period

Expected to Vest - The number ldquoexpected to vestrdquo is the number that is ldquopro-jected to vestrdquo at the end of the period This value is the number of shares that are outstanding but have not yet vested at the end of the period after applying the annualized forfeiture rate It can be determined using the amortization sched-ule for the grant

A

B

For each of the nine disclosures above you also need to disclose the weighted average exercise price For example if there was an option granted for 1000 shares at an exercise price of $2 and another option granted for 1000 shares at an exercise price of $3 during the year the weighted average exercise price for the number granted during the period (Item 2 above) would be (10002) + (10003)2000 = $25

Therefore for each of these disclosures you need to look at each individual grant exercise or cancellation that goes into the calculation and calculate the weighted average exercise price A standard formula for weighted average exer-cise price for each item above could be expressed (SUM(Disclosure Item for that grant Exercise Price for that grant) for all option grants used in the Disclosure Item)SUM of that Disclosure Item

i Note 1


C Disclosures gt Option Activity gt Note 1

32

For the following disclosures - total outstanding at end of the period total exercis-able at end of the period total unvested at end of the period and total vested or expected to vest at end of the period you also need to disclose the weighted average remaining contract term For this calculation you must first determine the remaining contract term for each option and then apply a weighted average based on the number of shares

The remaining contract term is calculated for each option by taking the number of days left between the reporting period end date and the date of expiration for that grant and dividing by 365 (because the value is disclosed as a number of years) A standard formula for weighted average remaining contract term for each item above could be expressed (SUM(Disclosure Item for that grant Remaining Con-tract Term for that grant) for all option grants used in the Disclosure Item)SUM of that Disclosure Item

j Note 2



33

For the following disclosures - total outstanding at end of the period total exercisable at end of the period total unvested at end of the period and total vested or expected to vest at end of the period you may also need to disclose the aggregate intrinsic value Intrinsic value is the difference between the fair market value at the end of the reporting period and the exercise price of the option Aggregate intrinsic value is the total of the intrinsic value for all the options included in the calculation for the disclosure item for the current report-ing period This value is not always required for privately-held companies because for many the fair market value changes infrequently However if you have the data you may choose to include it A standard formula for aggregate intrinsic value for each item above could be expressed SUM(Disclosure Item (Fair Market Value on Reporting Period End Date ndash Exercise Price for that Grant)) for all option grants used in the Disclosure Item For instance assume the fair market value of an option on the reporting period end date is $3 Then assume there is an option grant for 1000 shares outstanding at an exercise price of $2 and another option grant for 500 options outstanding at an exercise price of $1 The aggregate intrinsic value would be calculated (1000 ($3 ndash $2)) + (500 ($3 ndash $1)) = $2000

k Note 3



34

When reporting your equity compensation expense at a minimum you should report the following additional information in your disclosures

3 Expense Recognition


C Disclosures gt Expense Recognition

This is the total amount of expense expected to be recognized This in-cludes everything expensed to date the amount being expensed in the current period and the amount to be expensed in future periods

a Projected Fair Value


C Disclosures gt Expense Recognition gt Projected Fair Value

36

This is the amount of expense recognized prior to the beginning of the current reporting period

b Expense Reported Prior to Period


C Disclosures gt Expense Recognition gt Expense Reported

37

This is the amount of expense that you expect to recognize in the cur-rent period based on the amortization schedule at the beginning of the period or at grant date (if the option was granted during the current period)

c Projected Expense


C Disclosures gt Expense Recognition gt Projected Expense

38

If you are recognizing a ldquotrue-uprdquo during the current period then this is the total credit or debit being reported in the current reporting period

d True-Up Amount


C Disclosures gt Expense Recognition gt True-Up Amount

39

This is the total amount of expense being recognized as equity compen-sation expense in the current reporting period This would be Projected Expense + True-Up Amount

e Expense to Report


C Disclosures gt Expense Recognition gt Expense to Report

40

This is the total amount of expense that has now been recognized through the end of the current reporting period This would be Expense Reported Prior to Period + Expense to Report

f Total Reported Expense


C Disclosures gt Expense Recognition gt Total Reported Expense

41

g Remaining Expense [also known as Unrecognized Compensation]


C Disclosures gt Expense Recognition gt Remaining Expense

42

This is the amount remaining to expense over the remaining service period after the current reporting period This would be Projected Fair Value ndash Total Reported Expense

h Weighted-Average Period to Recognize Unrecognized Compensation


C Disclosures gt Expense Recognition gt Weighted-Average Period to Recognize

43

This disclosure is an estimate of the amount of time it will take to fully ex-pense the remaining amount of unrecognized equity compensation ex-pense To calculate the remaining period left to expense all option grants you take the number of months from the current reporting period end date for each option grant the unrecognized expense for that future period

The sum of this value for all grants is then divided by the total unrecog-nized expense This will be the weighted average period left to recognize the unrecognized equity compensation expense Note that this disclosure should be reported based on a number or years such as 225 years

Summary

44Equity Reporting Simplified

We hope that the terms described in this Handbook related to valuation expensing and preparing the disclosures under ASC Topic 718 (formerly FAS 123R) will help you gain a better understanding as you report your equity compensation expense There are many interconnected pieces related to the calculations variables ex-pensing and reporting but frequently the first step is gaining a basic understanding of the terms

We have heard from our Corporate Focus customers that understanding these terms better is a great first step If you have further questions that we can address please let us know



Corporate Focus is the leading cloud-based equity administration accounting and compliance system for privately-held emerging growth companies Since 1995 Corporate Focus has helped finance and legal professionals take control of their equity challenges by delivering faster and more accurate results reducing compliance risk and sharing information more easily

By replacing multiple error-prone spreadsheets with a centralized automated and secure equity reporting system growing companies save time and money as they manage increasing levels of complexity No matter the equity event faced Corporate Focus is backed by an experienced and knowledgeable support team who helps our customers navigate through every stage of the busi-ness life cycle from start-up to exit

Note The companyrsquos name was previously Two Step Software Inc

Connect With Us


Phone(800) 223-8900

Emailinfocorporatefocuscom

Websitewwwcorporatefocuscom

Follow Us Online

Option Activity

Total Outstanding at Start of the Period Grants During the Period Exercises During the Period Forfeitures During the Period Expirations During the Period Total Outstanding at End of the Period Total Exercisable at End of the Period Total Vested or Expected to Vest at End of the Period Note 1 Note 2 Note 3

Expense Recognition

Projected Fair Value Expense Reported Prior to Period Projected Expense True-Up Amount Expense to Report Total Reported Expense Remaining Expense (aka Unrecognized Compensation) Weighted-Average Period to Recognize Unrecognized Compensation

Summary


Connect With Us

23

24 25 26 27 28 29 30 31 32 33 34

35

36 37 38 39 40 41 42 43

44

45

46

1

2

3 4 5 6 7 8 9

10

11 12 13 14 15 16 18

19

20 21 22

Overview

A Valuation

Black-Scholes Formula Fair Market Value Exercise Price Expected Term Interest Rate Volatility Dividend Rate

B Expensing

Fair Value Per Share Actual Fair Value Requisite Service Period Forfeiture Rate Reporting Period Expensing Method Projected Fair Value True-Up

C Disclosures

Valuation Summary a Range b Weighted Average

Table of Contents

1 2 3 4 5 6 7

1 2 3 4 5 6 7

1

2

3

ab c d e f g hi j k

ab c d e f g h

Overview








1

2

3


A Valuation









2 Fair Market Value




3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online

Overview








1

2

3


A Valuation









2 Fair Market Value




3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


A Valuation









2 Fair Market Value




3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online








2 Fair Market Value




3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


2 Fair Market Value




3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


3 Exercise Price





4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online



4 Expected Term




5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


5 Interest Rate




1

2

3


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


6 Volatility




7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









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7 Dividend Rate




B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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B Expensing






11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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11


2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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2 Actual Fair Value



12





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





13


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


4 Forfeiture Rate



14


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


5 Reporting Period



15


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


6 Expensing Method



16


Continued

1




17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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17



2

3







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online







18


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


C Disclosures



1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


1 Valuation Summary




a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


a Range



21


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online


b Weighted Average



22


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online


2 Option Activity







24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





24





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online





25





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online





26





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





27





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online





28





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


Phone(800) 223-8900



Follow Us Online





29





30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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30




31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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31




A

B



i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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i Note 1



32



j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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j Note 2



33


k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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k Note 3



34









36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





36





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





37


c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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c Projected Expense



38


d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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d True-Up Amount



39


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online


e Expense to Report



40





41




42





43



Summary









Connect With Us


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Follow Us Online





41




42





43



Summary









Connect With Us


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42





43



Summary









Connect With Us


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43



Summary









Connect With Us


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Summary









Connect With Us


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Connect With Us


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Connect With Us


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Documents

Equity Compensation Reporting: Handbook of Key Terms · Weighted Average Vesting: This measures the amount of time from date of grant to each vesting tranche and weighs it based on