table of contents€¦ · · 2016-04-05table of contents 13 conferences, meetings and events ......

TABLE OF CONTENTS

13 CONFERENCES, MEETINGS AND EVENTS

15 TAKE COMMAND OF YOUR EQUITY PLANS

17 MAKING THE MOST OF YOUR DAY

18 MAKING YOUR LINKEDIN PROFILE WORK FOR YOU

19 SERVICING YOUR PLAN WITH INDUSTRY EXPERTS

20 RECOGNIZING NYSE HOLIDAYS

21 OFFERING OUR GLOBAL VIEW

23 TESTING YOUR KNOWLEDGE

1 INTRODUCTION

3 KEEP YOUR ESPP FREE FROM TAX-RELATED TRAPS

4 BUILDING EMPLOYEE LOYALTY

6 IMPROVING EMPLOYEE PARTICIPATION

7 CALCULATING THE COST BASIS OF STOCK

9 PROTECTING YOUR EMPLOYEE ASSETS

11 KEEPING YOU IN THE KNOW

5 THE INSIDE TRACK ON MANAGING CORPORATE INSIDERS

Copyright © 2015 Computershare Limited. All rights reserved. LinkedIn is a registered trademark of LinkedIn Corporation. WorldatWork is a registered trademark of WorldatWork.

Employee equity plans are definitely a

great way to align long-term company

and employee goals, but administering

them can be overwhelming — especially as

regulations evolve and plan designs shift to

solve for short-term aims. Fortunately, with

Computershare, you can ensure that your

program will be a success.

Kevin M. BrennanPresident > US Plan Managers

As responsibilities continue to grow and change for equity plan administrators,

we want to help you stay up to date. We’ve compiled the “Administrator’s Guide

to Employee Equity Plans” to provide you some key tips and tools to help you

manage your company’s equity programs, your participants, and even your

own career. From topics such as understanding the complex cost basis rules

to managing the intricacies of equity plans for corporate insiders, as well as

some handy time management ideas, this guide has you covered. For expanded

content, visit the guide’s companion site at computershare.com/adminguide and

sign up for our Insights newsletter at computershare.com/insights.

And remember, Computershare’s entire equity plans team is here to assist you

every step of the way. We offer a consultative approach to help you administer

your plan as well as promote it to your employees. We are also constantly

enhancing the experience for both the administrator and the participant. We’ve

enhanced our functionality to better support retirement eligibility taxation,

performance awards, tracking mobile employee demographics, and more.

Throughout 2015, we are upgrading the participant Web experience with a

refreshed look and mobile optimization that adapts the site to the size of the

user’s screen, be it a computer, a smartphone, or a tablet.

Thank you for your business. We appreciate it and work hard

every day to earn it. Your feedback is important and our team

is always here to listen and deliver ways that we can better

support you. Please feel free to contact me directly at

[email protected].

> 1

KEEP YOUR ESPP FREE FROM TAX-RELATED TRAPS

BUILDING EMPLOYEE LOYALTY

For an expanded list of ESPP tax tips and to see the full results

of the LSE study, go to computershare.com/adminguide

> 3

The London School of Economics conducted a survey of 3,800 employees to

determine how offering an ESPP can improve workplace performance. The results

showed a significant effect. Here are some of the benefits from offering an ESPP.

1. Hard Work. Plan members are more likely to work extra hours than non-members.

2. Pride of Ownership. Plan members feel like co-owners of the company. One-third check the stock price daily, versus 8% of non-members.

3. Valued Benefit. 75% of ESPP participants see it as a good investment.

4. Fewer Absences. Plan members take fewer days off (excluding vacation/annual leave) than non-members.

5. Worker Loyalty. ESPP participants are less likely to leave the company, even for a higher salary!

6. Increased Motivation. Plan members report higher on-the-job motivation versus non-members.

7. Workplace Satisfaction. ESPP participants are more likely to agree that the company is a good place to work.

8. Recommendations. Plan members are much more likely to recommend working at the company than non-members.

Employee stock purchase plans (ESPPs) can be a significant benefit to employees

and the issuing company. Administering an ESPP, however, can be challenging when

considering the numerous regulatory limitations. What follows is a list of top tax-

related traps to look out for when administering an ESPP.

1. Include controls to ensure participants do not exceed the annual $25,000 limit.

2. Be prepared to manage qualifying dispositions and W-2 reporting.

3. Look out for tax withholding implications among states and non-qualified plans.

4. Clearly communicate the rules for cost basis reporting.

5. Adjust the cost basis and fair market value after a corporate action.

6. Know the rules for transfers upon death.

7. Make sure your participant reporting clearly accounts for wash sales.

8. Provide a plain-English guide to Section 6039 reporting for your participants.

9. For non-U.S. companies, monitor the levels of foreign tax withholding.

THE INSIDE TRACK ON MANAGING CORPORATE INSIDERSTo say that the regulations surrounding corporate insiders are complex is an understatement. A strong compliance program is a must to keep your insiders and your company on the right side of the law. How confident are you in the management of your corporate insiders? Below are a few considerations when

reviewing your corporate insider compliance program.

1. Institute a pre-clearance protocol.

2. Benchmark your program against industry best practices.

3. Ensure insiders are properly trained on the program.

4. Review your insiders list periodically to ensure it is complete and accurate.

5. Ensure appropriate controls, monitoring and reporting exists for any awards, trades or changes in ownership.

6. Assign responsible people to file Forms 3, 4, 5 and Item 405 disclosure. Computershare’s Section 16 Manager can help.

7. Print out full year statements for each insider to review and sign off.

8. Disclose failures promptly.

9. Have insiders sign a statement that all reports were filed on time.

IMPROVING EMPLOYEE PARTICIPATIONWe know that your equity compensation program is an important part of your employee benefits package. But are your employees taking advantage of it?

Here are a few ways to help communicate your plan and improve participation.

1. Evaluate your plan design to ensure benefits are clear with incentives for participation.

2. Develop impactful communication materials utilizing online, telecom and print delivery channels.

3. Choose a time prior to a major event – open enrollment, purchase date, grant or vesting dates – to communicate to participants.

4. Engage leaders and current plan participants to continually promote your equity plans.

5. Set goals based upon your business objectives and employee population.

BONUS: Obtain a complimentary consultation on your program. Let us help you

achieve your participation goals. Contact Lu Ann Einholz, Communications Consultant,

at 732 491 0469 or [email protected].

ENGAGING YOUR EMPLOYEES VIA PHONE

Through our predictive autodialer solution, we can reach out to your employees at critical periods such as:

1. Options Expiring. Contact active and/or terminated employees to alert them of an upcoming stock option expiration date.

2. Grant Acceptance. Remind employees that need to acknowledge new grants issued.

3. Vesting of Restricted Stock. Remind employees that the restrictions on their shares have lapsed or that they’ve reached a certain milestone in their vesting schedule.

4. Annual Meeting. Remind employees to vote their shares during annual meeting season.

Contact your relationship manager if you’re looking for new ways to engage your employees with an autodialer solution.

For additional insights on insider

trading compliance programs,

download our white paper at

computershare.com/adminguide

> 5

CALCULATING THE COST BASIS

OF STOCK

Calculating the tax implications of cost basis — the original value of a security —

can be an overwhelming task. The regulations specific to employee equity awards

add another layer of complexity for plan sponsors and employees. To help address

common questions for managing cost basis requirements and processes we’ve

compiled a few guidelines to keep in mind.

For more information about managing cost basis requirements, sign up for our

Insights newsletter at computershare.com/insights or visit our partner site,

mystockoptions.com.

Only accounts for U.S. individuals require cost basis tracking and reporting. Rule of thumb: If the account receives a 1099-B for any share sales, then cost basis should be tracked within that account.

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Vestibulum rutrum sollicitudin molestie. Sed leo arcu, ultricies sit amet elit at, pulvinar sagittis nunc. Phasellus sit amet viverra diam.

Covered securities, for which brokers track cost basis, are only those purchased for cash, including cashless exercises of stock options and employee stock purchase plans. Vesting of restricted stock and stock-settled stock appreciation rights, as well as securities purchased before 2011, are not covered.

Watch out for wash sales. Wash sales occur when shares are sold at a loss, and shares in the same company are purchased within 30 days before and after the sale, requiring some or all of the loss to be disallowed.

Dividends reclassified as return of capital will reduce per-share cost basis for each lot held at the time the dividend is paid. This becomes more complex in plans with dividend reinvestment.

Remember the formula for cost basis of equity awards. Cash paid for the award plus compensatory income recognized.

Cost basis reported on Form 1099-B may be understated, or blank. Brokers can now only report the cash purchase price as cost basis, excluding compensatory income. Non-covered securities have no cost basis reported.

Stock splits, mergers, and spin-offs affect the per-share cost basis of all lots in the account. ESPPs require special oversight, because the fair market value prices at the beginning and ending of every offering period prior to the effective date will have to be adjusted.

Beneficiaries who inherit stock receive a “step-up” in cost basis to the fair market value of the stock with an acquisition date starting on the date of death. Any sales in the future are considered long-term for capital gain or loss reporting.

Strengthen recordkeeping standards. Under IRS rules, the taxpayer is responsible for proving the cost basis on any securities sold. Make sure accurate and complete records are retained and available. > 7

PROTECTING YOUR EMPLOYEE ASSETS

States are getting more aggressive with escheating unclaimed assets.

While the general consensus is that ESPP shares are not escheatable

while the holder is an active employee, they become fair game when

their employment status changes. Also, uncashed checks could be

up for escheatment, regardless of employment status. Before that

happens to your employees, let them know about the ways that they

can protect their assets from escheatment.

> Cash checks, no matter how small the amount

> Use Computershare’s Employee Online website to check account balances

> Contact Computershare by phone to inquire about your account

> Keep your address, phone number and other info on file up to date with your employer

> Know your state’s escheatment laws; do you live in a three-year or five-year state? Find out at naupa.org

Ways employees

can protect their

assets from

escheatment

> Receiving payments, such as dividends, via direct deposit

> Participating in a dividend reinvestment program

> Delivering federal tax forms or statements via regular mail

> Relying on an inquiry made on one stock account to protect all accounts or holdings with Computershare

Activities that MAY

NOT PROTECT

employee assets

from escheatment

> Educate employees about escheatment on every communication – statements, checks, electronic communications, plan information, HR page on internal website.

> Provide employees with a list of best practices for protecting their assets.

> Engage Georgeson Securities Corporation (a Computershare company) for a proactive shareholder cleanup and outreach program to identify and communicate with employees who are at risk for escheatment.

Ways to raise

employee

awareness of

escheatment rules

Computershare and its affiliates, Georgeson Securities Corporation and Georgeson Inc.* have several shareholder clean-up and outreach programs to help you minimize the risk. Talk to your relationship manager to learn more.

*Georgeson Securities Corporation and Georgeson Inc. are wholly owned subsidiaries of Computershare. > 9

National Association for Stock Plan Professionals (NASPP)naspp.comLeading membership association devoted to meeting the needs of stock plan professionals.

Global Equity Organization (GEO) globalequity.orgNon-profit association dedicated to advancing knowledge and understanding of equity compensation worldwide.

WorldatWork® worldatwork.orgNonprofit human resources association for professionals and organizations focused on compensation, benefits, work-life effectiveness and total rewards.

Employee Benefit News ebn.beneftitnews.comVideos, slideshows, podcasts, newsletters and conferences on the ever changing HR and benefits marketplace.

www.myStockOptions.comArticles, podcasts, videos and more for both participants and plan administrators alike.

www.mint.com/blogMint’s in-house blog touches on a number of personal finance issues, including strong information and coverage on the value of participating in employee stock plans.

@StockCompGuruBruce Brumberg from myStockOptions.com provides up-to-the-minute news and insight on employee plan administration.

@PerformensationDan Walter, leading expert and consultant on employee plans and a frequent speaker at industry events

@computershare You do follow us, right?

Industry Insights We Share

KEEPING YOU IN THE KNOW

The world of employee equity plans is ever-changing. It can be a challenge

to keep up with the latest in tax laws, regulatory issues, employee incentives…

it never ends. But you do have resources to which you can turn.

Twitter Accounts We Follow

Websites and Associations We Like

To read the full articles and view the webinars,

go to computershare.com/adminguide.

Important Information for Employee Plan Administrators in 2015This article covers important changes in SEC enforcement, accounting rules, cost basis, and ISS policies.

Equity Plans in China: Tips and InsightsThis informative webinar provides tips and insights on how best to navigate the extensive and oftentimes challenging process to set up an equity plan in China.

Tax Developments Affecting Global Equity Compensation ProgramsComptuershare’s ongoing series, produced in partnership with Ernst & Young, on global tax developments that could affect your company’s global equity programs.

> February 2015 webinar covered Australia, Brazil, France, Japan, Qatar and more.

> November 2014 webinar covered Austria, Canada, Kenya, Pakistan and more.

> August 2014 webinar covered China, Colombia, Germany, India and more.

> 12

CONFERENCES, MEETINGS AND EVENTS

WORLDatWORKThe Total Rewards 2015 Conference and Exhibition

May 18-20, 2015

Minneapolis, Minn.

GEO NATIONAL EQUITY COMPENSATION FORUM Sept. 14-16, 2015

Scottsdale, Ariz.

IN2015 Computershare | Georgeson

Oct. 7-9, 2015

Orlando, Fla.

NASPP 23rd Annual Conference and Exhibition

Oct. 27-30, 2015

San Diego, Calif.

STOCK AND OPTION SOLUTIONS (SOS) Aspirations Conference

Fall 2015

Location TBD

CEP SYMPOSIUM March 2016

Santa Clara, Calif.

GEO 17th Annual Conference

Spring 2016

Location TBD

> 14

> Online grant acknowledgement

> Multicurrency proceeds disbursements in 170+ currencies

> eDelivery for letters

> On-demand participant statements online

> Multilingual options for participants on Employee Online

> Reverse ACH for tax payments or option costs

> Participants can increase tax rates at exercise

> Unlimited access to the Knowledge Center of MyStockOptions.com

> BONUS! Mobile-optimized websites coming to all participants throughout 2015

TOOLS FOR PLAN PARTICIPANTS

TAKE COMMAND OF YOUR EQUITY PLANS

At Computershare, we believe in constant improvement. We have

developed a suite of tools to help you better manage your equity plans,

as well as tools for plan participants to manage their accounts. Here are

some of the favorites used by your peers and their plan participants. Many

of them were recommended by your peers on the Client Advisory Board.

Have a suggestion for a new feature that would improve our service for

you? Give your relationship manager a call.

TOOLS FOR STOCK PLAN ADMINISTRATORS

Coming in Fall 2015! Customized reporting tools

will be available to track and manage ESPP accounts.

> Performance awards tracking

> Mobile employee demographics tracking

> Retirement eligibility taxation management

> Adjustments and Corrections

Tool (ACT) to edit data on a single participant or grant

> Participant Web Interface (PWI) for read-only access to participant accounts

> File transmission monitoring tool for real-time view of all file exchanges and loading statuses

> Automated enrollment for ESPP

> Disqualified disposition tracking

> Section 6039 reporting

> Stock Plan Management Reporting Tool (SMARTSM) to access, format and create custom reports ONLINE BONUS: Go to computershare.com/adminguide for a list of the most popular reports used by administrators.

> 16

MAKING THE MOST OF YOUR DAY

These days we’re all asked to do

more with less. Regardless of your

job duties, it likely includes more

responsibilities than it did last year

or the year before. Here are some

tips you can use to get the most

out of your day.

> Use the first 30 minutes of each

day to plan out what you expect to

accomplish before going home.

> Don’t accept a request for a meeting

that doesn’t include an agenda.

> Download a browser app, such

as Freedom or SelfControl, which

allows you to set a window of time

in which you will be unable to access

distracting websites so you can focus

on your work.

> Take care of routine items first –

get them out of the way and use

the rest of your time on tasks that

interest you.

> If it takes less than five minutes, just

do it now (like, right now…we’ll wait).

> If you’re being bombarded with

emails or instant messages and you

need to get something done, unplug

your network cable or turn off the

wifi – just don’t forget to reconnect

when you’re done.

MAKING YOUR LINKEDIN PROFILE WORK FOR YOU

Create a personal brandUnderstand your audience

Tailor your profile to speak to the

people whose attention you are

trying to get.

Tell your story

Provide a snapshot of your

professional journey and aspirations.

Let your network speak for you

Get recommendations and

endorsements from colleagues,

employers and customers

Build your network of connectionsFind business contacts that help you succeed

Connect with past and present

colleagues, business partners and

other contacts

Stay in touch

Keep up with connections since you

never know when you might need to

reach out.

Find and join groupsFind groups

Check the “Groups You Might Like”

page or use the LinkedIn search tool.

Choose the right group for you

View the group’s “Discussions”

page. Check the group profile for

more information.

Join a group

Click “Join” or respond to an

invitation from a member.

BONUS TIP Showcase pageCreate an “employee plans”

showcase page on your company’s

profile to engage participants.

Showcase pages are designed for

building strong relationships with

people who want to follow specific

aspects of your business.

> Don’t let meetings turn into work

sessions. Meetings are for status

updates and planning next steps, not

plodding through work that should

have been done in advance.

> “Perfect” is the enemy of “done.”

Don’t allow your project to become

paralyzed by the unattainable goal

of perfection.

> Take notes from casual

conversations with colleagues.

Informal chats often produce better

results than meetings, but it’s easy

to forget the key points if you don’t

jot them down.

> Leave your work at work – unless

you’re in the midst of a crisis, there’s

not a whole lot you can get done

at 10 p.m. that can’t wait until the

next morning.

> 18

Our equity plans team is among the most knowledgeable and experienced

in the industry. They are members of all the major associations for stock

plan administrators, often speaking at local, national, and international

conferences and events. They bring this expertise to servicing your plan

participants every single day.

SERVICING YOUR PLAN WITH OUR INDUSTRY EXPERTS

Computershare in the U.S. follows the same holiday schedule

as the New York Stock Exchange, below. Since trades cannot be

made on these days, be sure your plan participants know about

the holiday schedule as well.

RECOGNIZING NYSE HOLIDAYS

Jeff Cohen Senior Vice President, Strategic Business Dev 201 680 4477

Kevin Brennan President201 680 4313

Scott HarriganSenior Vice President732 491 0450

Sheila FriersonVice President, Relationship Management 310 751 1496 Bob Bilotta

Senior Vice President201 680 4396

Mark ZollaSenior Vice President312 499 7011

Joe PetranySenior Vice President, Product201 680 2449

Mark BoemioVice President, Relationship Management 201 680 3460

Phyllis GarlandVice President, Relationship Management732 491 0464

Alex EstebanBusiness Manager, Client Services201 680 4928

New Year’s DayJanuary 1

Martin Luther King, Jr. DayJanuary 19

President’s DayFebruary 16

Good FridayApril 3

Memorial DayMay 25

Independence DayJuly 4 (Observed July 3)

Labor DaySeptember 7

Thanksgiving DayNovember 26(markets close at 1:00 p.m. EST on Friday, November 27)

ChristmasDecember 25 (markets close at 1:00 p.m. EST on Thursday, December 24)

2015

New Year’s DayJanuary 1

Martin Luther King, Jr. DayJanuary 18

President’s DayFebruary 15

Good FridayMarch 25

Memorial DayMay 30

Independence DayJuly 4

Labor DaySeptember 5

Thanksgiving DayNovember 24(markets close at 1:00 p.m. EST on Friday, November 25)

ChristmasDecember 25 (Observed December 26)

2016

> 20

OFFERING OUR GLOBAL VIEW

With offices located throughout the U.S., we offer you localized service that allows

your relationship manager the opportunity to engage with you on a regular basis.

And with Computershare’s global footprint, we are able to leverage operational and

call center support in locations around the world to provide optimal service to you

and your participants. We also have the knowledge and expertise to help you set up

plans in countries all over the world.

Canada220 clients

US368 clients

Australia120 clients

Asia100 clients

Europe353 clients

Offshore324 clients

South Africa

30 clients

Australia

Canada

Channel Islands

China

Denmark

Germany

Hong Kong

India

Ireland

Netherlands

New Zealand

South Africa

Spain

Sweden

United Kingdom

United States

If you’re looking to take your employee equity plans global, contact

your relationship manager to help.

Computershare maintains offices supporting

employee equity plans in these locations

> 22

Which was the first publicly traded company to issue stock? What is the oldest

written language known in existence? If you saw our Friday Fun Facts email

series, you already know the answers.

Missed it? No problem. Here are all of the fun facts we shared in the emails.

Keep an eye out for the next series.

TESTING YOUR KNOWLEDGE

WEEK 1 - DID YOU KNOW?

Cattle are the first and oldest form of

money. Each head of cattle was called

a caput, which is Latin for “head.” So,

a person with a lot of cattle had lots

of caput or “capital,” a word still used

today to describe money.

DID YOU ALSO KNOW...

COMPUTERSHARE OFFERS

PAYMENTS IN MULTIPLE

CURRENCIES

Plan participants are able to receive

their funds in any one of more than

70 currencies.


The first email message ever sent was

by Ray Tomlinson to himself in 1971. It

was part of the ARPANET project, which

eventually turned into the Internet.



CUSTOMIZED PARTICIPANT

COMMUNICATIONS

Our expert communications team is

ready to help you design a program

tailored to the unique needs of

your employees.


The shortest flight one can

purchase is from the Scottish Isle

of Westray to Papa Westray. It lasts

just two minutes, spanning a little less

than two miles.



ROBUST MOBILITY TRACKING

FUNCTIONALITY

Track and report on demographic

information for mobile employees

across multiple countries and

U.S. states.


The Dutch East India Company,

formed in 1602, undertook the world’s

first IPO, issuing shares to raise

capital to fund its voyages, making it

the first publicly traded company to

issue stock.



EXECUTIVE SERVICES

Our highly qualified team of certified

equity professionals is ready to assist

executive officers with selling their

plan shares.


The oldest written language known in

existence is Sumerian, dating back to

3100 B.C., in southern Mesopotamia.


COMPUTERSHARE OFFERS MULTI-

LINGUAL PARTICIPANT SUPPORT

Multi-lingual support is available on the

Employee Online website and will soon

be available on the phone via live reps

through our call center in Barcelona.


The Olympic flame is lit at Olympia,

Greece with a concave mirror and the

sun’s rays. The flame then begins a

journey from Greece to the host nation

where it is paraded around for months

until the opening ceremonies.


COMPUTERSHARE OFFERS ROBUST

PERFORMANCE AWARDS TOOLS

Manage and track performance

awards, apply interim performance

measurements to grants, accrue cash

dividends until vesting, and more.


Today’s mobile phones on average

have more computing power than

the computers used for the Apollo 11

moon landing.



PARTICIPANTS A MOBILE-

OPTIMIZED WEB EXPERIENCE

Throughout 2015, we will roll out a

mobile-optimized web experience

to plan participants, offering full

functionality, no matter what

device is used.


The first newspaper, the Acta Diurna,

was published in 59 B.C. in Rome.



BUSINESS OBJECTS REPORTING

On-demand access to standard reports

for options, restricted stock and

performance awards plans. COMING IN

2015: Expanded reporting for employee

stock purchase plans.

> 24

ABOUT COMPUTERSHARE

Computershare is a global market leader in transfer agency, employee equity

plans, proxy solicitation, stakeholder communications, and other diversified

financial and governance services. Many of the world’s leading organizations

use Computershare’s services to help maximize the value of relationships with

their investors, employees, creditors, members and customers.

cpm.computershare.com

table of contents€¦ · · 2016-04-05table of contents 13 conferences, meetings and events ......

Documents