ExecutiveLoyalty.org

See:proxy statement disclosure for samples of tax and accounting impact of awards.

EQUITY-BASED PLANS AND AWARDS

• General information: feel welcome to email Mark to request a complimentary table that compares the business, accounting, and tax consequences of different forms of award.
• Stock Plan Improvements
  
  • Diversification Alternatives (added 2018.07.11)
  • 2018 Article: New Year, New Plan (Bloomberg BNA, Poerio, 2018.02.22)
    
  • Shareholder Approval Generally
    
  • 2016 Checklist     [download published version]
  • 2011 Article
• Deferred Share Units 
  
• Restricted Stock and RSUs
  
  • Deferral Possible through Code Section 83(i) - new in 2017.
  • Section 83(b) elections - IRS Rev. Proc. 2012-29 with sample language /  Blog
    
• Stock Options
  
  • Grant Date
  • Post-termination Exercise Period - lengthening considerations (Andreeson memo)
  • Modifications, such as to accelerate vesting
    
  • Repricing - Poerio Law360 Article
  • Exercise during Blackout Periods - see this article

Securities Law Compliance (U.S.)

• California
  
• China

Tax Rules for Equity Awards(and Deferred Compensation)

Accounting for Equity Awards

• General Summaries:
  
  • 2019   PwC's Comprehensive Guide (250+ pages!)
    
  • 2014.Mar.20    Summary by Frederic W. Cook -- of Equity vs Liability Accounting
  • 2007   Summary in Journal of Accountancy - "A Roadmap for Share-based Compensation"
    
• New Developments:
  • 2016.03.30   Maximum Statutory Withholding Allowed; Other Simplifications Allowed.  FASB has issued Accounting Standards Update (ASU) 2016-09, "Improvements to Employee Share-Based Payment Accounting," which amends ASC Topic 718, Compensation – Stock Compensation.  See FASB Press Release / Deloitte Alert / PwC Alert / Frederic W. Cook Alert.
  • 2013.Oct.29  Delay of All Expense? Possible through CIC or IPO Contingency. Twitter's Form S-1 (Amendment No. 1, filed on Oct. 15, 2013) discloses the absence of any past financial expense for certain restricted stock units, aka RSUs, because their vesting was considered uncertain for GAAP purposes - due to being contingent on both future service and the completion of an IPO or change in corporate control.  Twitter's S-1 explains on pages 81-82 that the closing of the IPO will result in future RSU financial expense, due to satisfaction of the IPO condition.  This handling of the expense for stock-based awards is common, and may also apply to cash-based awards.  In each case, the lynchpin for deferred expense is the uncertainty of future vesting.  Thoughtful drafting and communication with financial experts are needed to assure this design brings the desired financial consequences without triggering adverse effects (with one key consideration being Code §409A).