Catch on a bunch of missed articles and jobs from 14 Dec 2010

Individual articles highlighted in YELLOW

 

Equity in the News:

Examining AT&T’s use of equity compensation.

theRacetotheBottom - Home - The Director Compensation
Project - AT&T http://bit.ly/gD5uAP

 

 

 

Participant Communication and Education:

Get smart about equity compensation - Fidelity Investments http://bit.ly/fex4vZ

Get
smart about your stock plan

Fidelity
Viewpoints — 12/08/10

How stock plan benefit
awards can help contribute to long-term financial success.

If your employer provides you with
equity compensation, whether it’s in the form of stock options, restricted
stock, or an employee stock purchase program, you owe it to yourself to
understand how to help maximize your benefits. Why? Because equity compensation
awards, when managed correctly, can be a potential wealth accumulation vehicle
that should be considered along with your 401(k) plan, IRA, or other savings
vehicles.

“I would encourage people not to think
of these assets as 'play money,'” says Jon Skillman, president of Fidelity
Stock Plan Services. “No matter the type or size of the award, recipients
should consider their equity compensation assets to be an important part of
their overall, long-term financial plan.”

Here’s what you need to know to help
you understand and get the most out of your equity compensation benefits.

Employee stock options

An employee stock option grant provides
an opportunity to buy a predetermined number of shares of your employer’s
company stock at a pre-stablished price, known as the exercise, or strike,
price. In most cases, you must wait a certain number of years before you can
exercise your option to buy. This period, referred to as the vesting period,
typically ranges from one to 10 years.

After you meet vesting requirements,
you can exercise your stock option

 

 

 

Equity
in the News:

Fortress
Announces Adoption of Automatic Share Disposition Plan - Press Release -
Digital Journal http://bit.ly/endbLp

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 10, 2010) -

Fortress Paper Ltd. ("Fortress Paper" or, the
"Company") (TSX:FTP) today announced that it has adopted an Automatic
Share Disposition Plan (the "ASDP") to enable its directors and
senior executive officers to satisfy their tax liabilities resulting from the
receipt of equity compensation or to diversify their investments and meet
investment planning goals by selling, on an automatic basis through an
independent third party securities broker (the "Broker"), certain of
their common shares, including common shares issuable upon the vesting of units
under the Company's 2009 long-term incentive plan and the exercise of stock
options. Sales of common shares under the ASDP will be made in the open market
through the facilities of the Toronto Stock Exchange by the Broker in
accordance with a pre-determined quarterly sales schedule, and could include
circumstances when participants would ordinarily not be permitted to sell their
common shares due to restrictions under Canadian securities laws or trading
blackouts imposed under the Company's insider trading policy. Participants will
be subject to meaningful restrictions on their ability to modify or terminate
their participation in the ASDP.

Executives may only participate in the ASDP if they meet minimum
share ownership requirements of three times their base salary or, in the case
of the President or Chief Executive Officer of the Company or any of its
subsidiaries, five times their base salary.

The ASDP is designed to constitute an "automatic plan"
for the purposes of applicable Canadian securities legislation and guidance.

About Fortress Paper

Fortress Paper is a leading international producer of security and
other specialty papers and products. Fortress operates three mills, the
Landqart Mill located in Switzerland, the Dresden Mill located in Germany and
the Fortress Specialty Cellulose Mill located in Quebec, Canada. Fortress
Paper's security papers include banknote, passport and visa papers and its
specialty papers include non-woven wallpaper base products, and graphic and
technical papers. Fortress Paper's pulp business includes NBHK produced at the
Fortress Specialty Cellulose Mill with plans to convert this capacity into
dissolving pulp production along with the construction of a biomass based
cogeneration plant.

 

 

JOB
BOARD: Stock Plan Administrator Job in Burlington, Massachusetts US http://bit.ly/evJCnw

POSITION     Stock Plan Administrator

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

   

Job Description:

Our client is seeking
a Stock Plan Administrator.
Main Duties: 

• Administer
  equity compensation programs

• Lead
  equity contact for domestic, international and executive employees

• Provide
  equity trainings for ESPP, RSU's and stock options for company

• Coordinate
  10b5-1 plans and Pre-Clearance plans with executives and captive broker

• Conduct
  monthly, quarterly and annual reporting which includes but not limited to
  information needed for Proxy, Form 10-K, Forms filed for executive
  officers, and various international filings

• Collaborate
  with Finance, Legal and HR teams on communication materials, grant
  process, equity cost analysis, technical accounting, compliance and
  management reports

• Work
  closely with payroll leads to provide US and International equity income
  transactions

• Process
  new grants and other transactions with strong understanding of accounting,
  tax and legal implications

• Administer
  semi-annual ESPP enrollments & purchases

• Generate
  disqualified disposition reports and year-end tax statements

• Provide
  year-end training on the impact of equity transactions on employees W-2's and
  international equivalent

• Improve
  processes, efficiencies and accuracy of data

• Work
  with large data sets, perform data edits, audits, reconciliations,
  v-lookups and complex calculations

• Complete
  special projects as needed.

Qualifications:

• Bachelor's
  Degree, Certified Equity Professional (CEP) III or a minimum of 5 years of
  stock plan administration experience required

• Knowledge
  of Equity Edge and Fidelity Stock Plan Services preferred

• Knowledge
  of equity-related accounting, tax and legal concepts

• Excellent
  Microsoft Excel and Word skill

• Excellent
  customer service skill

• Strong
  written and verbal communication skills

• Detail
  oriented and highly organized

• Ability
  to work in fast paced environment and prioritize multiple tasks

 

 

Equity
in the News:

SEC
Settles Vitesse Stock Option Backdating Case - The BLT: The Blog of Legal Times
http://bit.ly/erll1M

December 10, 2010

SEC Settles Vitesse Stock Option Backdating Case

Stock
option backdating cases live on. The Securities and Exchange Commission today
simultaneously filed and settled civil fraud charges against California-based
integrated circuit maker Vitesse Semiconductor Corp. and four former senior
executives for inflating revenue and backdating stock options.

According
to the SEC, from September 2001 through April 2006, the defendants “engaged in
an elaborate channel stuffing scheme in order to improperly record revenue on
product shipments.” As a result, Vitesse inflated the revenue it reported in
its financial statements for 14 quarters, the SEC alleged in a complaint filed
in U.S. District Court for the Southern District of New York.

The
defendants also “engaged in a scheme to backdate stock option grant dates for
their personal benefit and the benefit of other Vitesse executives and
employees,” the SEC alleged. As a result of the backdating, Vitesse failed to
record approximately $184 million in compensation expenses and the defendants
"collectively reaped millions of dollars in illicit profits."

The
defendants are co-founder and former Chief Executive Officer Louis Tomasetta,
former Chief Financial Officer and Executive Vice President Eugene Hovanec,
former Controller and Chief Financial Officer Yatin Mody, and former Manager
and Director of Finance Nicole Kaplan.

Vitesse
settled the matter by agreeing to pay a $3 million civil penalty. Mody and
Kaplan have each agreed to

 

 

 

 

 

JOB
BOARD:

Director,
Stock Administration at Blue Coat Systems in Sunnyvale, CA | LinkedIn http://linkd.in/fq2mVK

Job Description

In this
role, you will manage the administration and compliance of equity award
programs company-wide. You wil stock plan analysis to executive management and
the Compensation Committee. You will evaluate best practices and developments
in applicable laws to drive changes in stock plan implementation and
administration. The director will partner with HR, Legal and Finance to ensure
ongoing compliance and vendor relationships. They will develop employee
communication and education programs in partnership with the HR Department.
Manages a team of two stock plan professionals.



The role also requires the manager to be hands-on in the daily administration
of the company's equity programs, when needed.



This may include, but is not limited to, processing transactions for option
exercises; processing equity grants for new hires; answering employee
questions; and resolving problems regarding equity awards. Must also maintain
the Equity Edge database by keeping information up to date to ensure the
accuracy of monthly, quarterly and annual reporting. Works on special projects
related to equity matters.



Primary Responsibilities:

* Manages the daily administration and compliance of the company's equity
programs.

* Monitors developments and changes in laws affecting equity compensation
domestically and internationally.

* Partners with HR, Legal and Finance to ensure on-going compliance.

* Evaluates best practices to drive change in stock plan administration to
improve efficiency and compliance.

* Develops employee communication and education programs in partnership with
HR.

* Ensures compliance with section 16 and Rule 144 reporting requirements.

* Ensures compliance with ASC 718 (FAS 123R) quarterly and annual reporting
requirements.

* Provides stock plan analysis and reporting to executive management and the
Compensation Committee

 

 

Participant
Communication and Education:

Do
I Need To Report Stock Option Payout If It Is Already Reported On W2 Form And
Already Taxed In Paycheck? | Love every day http://bit.ly/i49lK0

My
company was acquired in 2006 and the acquisition closed at the end of the year.
All of our vested stock options were paid out in our paycheck, and taxes were
withheld from them. In addition, we were also paid out for our last ESPP
purchase in the same pay period and taxes were also withheld for this. All of
these sales are already included in my W2 form and included as income. My
question is: Since taxes were withheld for the last ESPP and all of my vested
stock options already, do I still have to report them in Schedule D as Capital
Gain?

I am using TurboTax Premiere, and if I report these sales it automatically adds
disqualifying disposition as income to my W-2, which is incorrect and redundant.

 

 

 

Equity
in the News:

Don't
let value of options slip away - Chicago Sun-Times http://bit.ly/g2BUF1

Do
you know your stock options--or at least what they're worth-

Surprisingly
few people do.

Yet
more than 12 million Americans--one of every 10 private sector employees--have
been awarded company stock options.

And
a new Oppenheimer Funds survey shows that 11 percent of survey respondents had
actually allowed valuable "in-the-money" options to expire worthless.
That's just throwing money away.

But
that's only one way to lose money on options. Millions of employees have
counted their stock options as a significant portion of their wealth. But a
decline in stock market fortunes has rendered many of those options currently
worthless--underwater in the parlance of the markets.

Surely,
if the stock rebounds before the options expire, there could be some future
value to the options.

But
now's the time to figure out exactly where you stand--and what you should be
doing about your options. Making the right decision can make a substantial
difference in your net worth--and in your tax bill. Corporations face some
equally touchy problems on the subject of options.

In
the past decade, many companies came to rely on stock options as an important
part of total compensation. Technology companies made particular use of stock
options, not only as a way of attracting and motivating employees, but because
granting options saves on cash payouts for wages. It's not as if options have
no cost to a company. Eventually, the company will have to buy in or issue
stock when these options mature--if the options have value.

That's
a potentially expensive issue for companies like Microsoft, which have made
liberal use of stock options.

In
the meantime, as stock prices fall, companies are faced with another dilemma:
how to retain and motivate employees whose options have a striking price far
above the current stock price.

In
short, what can the company do for disappointed employees whose

 

 

 

 

Equity
in the News:

Dealing
with Employee Stock Options in Corporate Acquisitions – Navigating the Labyrinth
| Taxand http://bit.ly/hggZBS

n
a transaction involving the purchase and sale of shares, there may be
outstanding employee stock options held by employees of the target corporation
("Target").  It is generally in the best interests of all
parties to safeguard the most beneficial tax treatment possible for the holders
in dealing with those stock options.  The option holders may continue to
be employed in senior management positions by Target or by a corporation
resulting from a post-closing business combination with Target. In these
circumstances, preserving favourable tax treatment for option holders may be
key to the future employment relationship with these individuals.  Taxand
Canada identifies the steps to achieve the best tax result that requires an
understanding of the relevant country's income tax rules applicable to the
stock options, a review of the existing stock option plan and agreements, and
careful consideration of the impact of the terms of the purchase and sale
transaction on those options. 

Canada's Tax Rules Applicable to Employee Stock
Options

Most stock option plans of Canadian public corporations are structured to
satisfy conditions that allow an offsetting deduction by the employee of
one-half of the amount of the employment benefit arising at the time of
exercising the option and acquiring the underlying shares.   To
obtain this beneficial tax treatment, the exercise price must not be less than
the fair market value of the underlying share on the date the option is granted
and the underlying shares must be "prescribed shares" at the time of
exercise (or surrender) of the stock option.   Under Canada's tax
laws, an employer is not entitled to an income deduction in respect of shares
issued on the exercise or surrender of a stock option.

Dealing With In-the-Money Options in a Corporate
Acquisition

There are essentially four ways of dealing with options of Target in a manner
that does not trigger adverse tax consequences for Canadian option holders:

• the
  options may be surrendered by the holders in consideration for a payment
  from Target that is equal to the difference between the exercise price and
  the share purchase price, to be paid in cash or "in kind" with
  shares of Target that can be tendered to the offer of the purchaser


• the
  options may be exercised and the shares tendered by the holder to the
  offer


• if
  the intention is that Target will continue to exist after the acquisition,
  the options may survive the transaction and continue under the existing
  option plan or be exchanged for new options of Target


• the
  options may be exchanged for new options of the purchaser corporation on a
  tax-deferred rollover basis.

The
most tax effective method will depend upon all of the circumstances.

Issues with Prescribed Share Rules on Exercise or
Surrender

The one-half deduction of the benefit will be lost if the shares are not
"prescribed shares" at the time of the exercise or surrender of the
options.   In the context of a corporate acquisition, it is easy to
inadvertently and unintentionally fall off-side of these complex rules. 
For example, if the options are exercised or cashed-out at, or after, the time
that the purchaser acquires a controlling interest in Target, the favourable
tax treatment for the option holders will generally be lost.

Withholding Tax on the Surrender or Exercise of
Options

Under Canada's tax laws, for 2011 and subsequent years, there is no exemption
from withholding tax for stock option benefits.  Withholding from a cash
payment on the surrender options is relatively straightforward.   On
the issuance of shares, withholding tax may be funded by a sale of the shares
on the market on the employee's behalf; withholding from other remuneration; or
by requiring the employee to fund the withholding tax as a condition of the
issuance of the shares.  Any arrangement involving a repurchase by a
Canadian corporation of its shares should be avoided, as it may cause the
employee to lose the entitlement to the one-half deduction and may also give
rise to a deemed dividend. 

Exchange of Options

If certain conditions are satisfied, the exchange of options may be
accomplished on a "rollover" basis.  The new options are deemed
to be the same options and a continuation of the old options.  If the new
options are issued by the purchaser corporation, it will be deemed to be the
same person, and a continuation of the person (Target) that granted the old
exchanged options.

 

Taxand's
Take

The treatment of the option holders of Target needs to be carefully considered
well in advance of the closing date of the acquisition. When left until the
"eleventh hour", the closing of the transaction may be delayed and
patchwork solutions to deal with the options may trigger adverse tax
consequences for the option holders.

In a transaction involving the acquisition of a
corporation, it is generally to the benefit of all parties to deal with
outstanding stock options in a manner that preserves the most favourable tax
treatment for the option holders and is appropriate to the structure of the
overall transaction.  There is no "one-size fits all"
solution.  Unexpected issues can and do arise.  For example, where
option holders are resident in Canada, avoiding unexpected adverse tax
consequences for those option holders requires a careful navigation of the
labyrinth of prescribed share rules.  Understanding the potential issues
early in the negotiations may be vital to dealing with them in a timely and
appropriate manner.

Your Taxand contact for further queries is:

Gloria Geddes

T. +1 415 369 4583

E. gloria.geddes@gowlings.com

 

 

 

 

 

 

General
Discussions:

startup
- How much in stock options should we offer new employees? - OnStartups - Stack
Exchange http://bit.ly/fKWPYT

We're
a software startup with annual revenue in the ballpark of half a million. We're
completely bootstrapped, and have no current plans to take funding. We
currently have 4 employees. We're looking to hire two new developers as we
shift our focus to a new complementary product - one senior back-end web
developer and one junior front-end web developer. The back-end position is much
harder for us to fill. Both will be paid about market rates. No benefits.

I'm
new to equity incentives. How should we plan to tackle this? What percentages
for each? Is issuing options better than stocks? How do we go about setting a
strike price? How big of an option pool should we set aside? Any advice on
vesting periods or clauses to include? We're based in Canada, if that makes a
difference. Thanks!

 

Participant
Communicatio and Education

Video
on Reg FD (prohibition against selective disclosure of material non-public
information) : ON Securities http://bit.ly/fkHk0B

 

 

 

 

International
Equity:  Plan Design in India

Employee
Stock option Scheme - Corporate Law Forum - Chartered Accountants India,Taxpayers,
CAs India, CA india ,ICAI, Company Secretary ,CS, Cost Accountants, MBA,
Finance Professionals http://bit.ly/hFkmyd