SURVEY - Proposed ESPP regulations
I just sent this blast:
These proposed regulations require some interesting
Survey Thread - http://equitycompensationexperts.collectivex.com/discussion/topic/show/80999
Baker & McKenzie Summary - http://equitycompensationexperts.collectivex.com/discussion/topic/show/86853
Please cut and paste the questions into your response and add your answers
General
Have you read the proposed ESPP regs or a summary of them?
Have you provided comments regarding the proposed regs?
Exclusion of Employees
Do you currently exclude part-time employees from your ESPP?
Do you currently exclude collectively bargained employees from your ESPP?
Do you currently exclude non-US employees from your ESPP?
If yes to any of the above, how will you work within the proposed regs?
Equal Rights and Privileges
Do you have employees in locations that would be impacted by the proposed tightening to equals rights and pivileges?
Date of Grant
How do you define your ESPP Grant Date?
Will you consider changing your grant date if the new regs are approved?
Do you currently have a per participant, per offering share limit defined?
Annual $25,000 limit
WIll the new definition of this limit (years in which the grant is both outstanding and exercisable) effect your plan? (Do your offering periods overlap multiple calendar years?)
Shareholder Approval Requirements for Subsidiary's Option Grants
Do your subsidiaries offer ISOs and ESPPs with payout made in the parent company stock?
If yes, how do you see the proposed regulations changing your approval process?
(from Baker & McKenize: "Those
final ISO regulations provide that although a parent corporation can
approve an ISO plan adopted by a subsidiary to grant options on that
subsidiary's stock, if the subsidiary wants the options to be granted
with respect to the parent's stock, the parent's shareholders must
approve the plan.[5] These
proposed regulations reverse that rule, permitting the parent
corporation to approve a subsidiary's grant of options on the parent
corporation's stock. Comments are invited on this
proposed change (which, as proposed, would affect both the ESPP
regulations and the ISO regulations"
Effective Date
Will you, and your providers, have time to make required changes prior to the 1/1/2010 effective date?
Please add any other comments you may have or any additional questions you may have for other ECE members.
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General
Have you read the proposed ESPP regs or a summary of them? YES
Have you provided comments regarding the proposed regs? NO
Exclusion of Employees
Do you currently exclude part-time employees from your ESPP? YES - WE EXCLUDE EMPLOYEES WHO WORK LESS THAN 20 HOURS/WEEK
Do you currently exclude collectively bargained employees from your ESPP? N/A
Do you currently exclude non-US employees from your ESPP? YES - CHINESE EMPLOYEES ARE EXCLUDED
If yes to any of the above, how will you work within the proposed regs? WAITING TO SEE
Equal Rights and Privileges
Do you have employees in locations that would be impacted by the proposed tightening to equals rights and pivileges? NO
Date of Grant
How do you define your ESPP Grant Date? BEGINNING OF THE OFFERING PERIOD
Will you consider changing your grant date if the new regs are approved? NO
Do you currently have a per participant, per offering share limit defined? YES - DEFINED IN PLAN DOCUMENT AS 10,000 SHARES PER OFFERING OR 1,666 PER PURCHASE
Annual $25,000 limit
WIll the new definition of this limit (years in which the grant is both outstanding and exercisable) effect your plan? (Do your offering periods overlap multiple calendar years?) YES - OUR OFFERING PERIODS ARE 18 MONTHS
Shareholder Approval Requirements for Subsidiary's Option Grants
Do your subsidiaries offer ISOs and ESPPs with payout made in the parent company stock? NO
If yes, how do you see the proposed regulations changing your approval process?
(from Baker & McKenize: "Those
final ISO regulations provide that although a parent corporation can
approve an ISO plan adopted by a subsidiary to grant options on that
subsidiary's stock, if the subsidiary wants the options to be granted
with respect to the parent's stock, the parent's shareholders must
approve the plan. [5] These
proposed regulations reverse that rule, permitting the parent
corporation to approve a subsidiary's grant of options on the parent
corporation's stock. Comments are invited on this
proposed change (which, as proposed, would affect both the ESPP
regulations and the ISO regulations"
Effective Date
Will you, and your providers, have time to make required changes prior to the 1/1/2010 effective date? DEPENDS ON WHAT THE FINAL REGS LOOK LIKE
Please add any other comments you may have or any additional questions you may have for other ECE members.
We have kept our ESPP plan with all the bells and whistles even after FAS123(r). We have an 18-month offering period with quarterly purchases and a 15% discount. It's the benefit we most advertise since most other stock grants have been severly limited to the overall population. As we see it now, we will be most affected by revision to the $25K limitation as numerous employees (not only officers) reach the limit in any particular offering.