The scenario analysis captures exercises, forfeitures, and post-vest cancellations
from the historical data. The forfeitures are used to determine the outstanding pool
of options and do not affect the expected term calculation (either historical or
projected). The exercises and post-vest cancellations are essentially treated as
settlement transactions-a time-to-settlement is calculated as the time between
grant and settlement date (exercise date or post-vest cancel date), and then
weighted by the shares settled (options exercised or canceled). Assumed and
Modified Grants will not be included in this calculation.
1. Enter an apply as-of date. The default is the current date. However, the as-of
date should be changed to the end of the reporting period or last day of the
period you are analyzing. You may also select an as-of date by clicking on the
calendar icon and selecting a date from the calendar.
2. Award Type Filter Selection: This filter allows you to save Scenarios based on
one or multiple option-type awards. The choices are NQ, ISO and SAR. The
default checked selection is NQ and ISO. Checking the Award Type allows you
to customize scenarios for one or a combination of award types.
3. Select a filter for minimum grant date. You may choose to apply a filter for a
given minimum grant date, by checking this box and entering a date (or by
clicking on the calendar icon to select a date from the calendar). Otherwise, all
dates from the grant history are used.
4. Select the scenario type: Select
the most appropriate scenario for your
company. To control for bias from outstanding vested options, Option
Navigator™ assumes and analyzes the following three scenarios for settlement:
All
options settled today (or on an as-of date)
All
options settled at the midpoint between today (or as-of
date) and expiration
All
options settled at expiration
5. Click the Calculate button: Generates
the number of settlement records,
number of options settled and expected term.
To save the calculations:
- Click the Save to Selection button. The expected term calculation is
removed from the page and ‘moved’ to the expected term section at the
bottom of the page. The selection also displays the award type for which that
scenario is applicable. Note: This information can also be seen on the Your
Selection page.
To remove saved calculations:
- Click the red Remove ‘X’. However, be aware that there is no confirmation
before it is removed.
6. Click the Audit Report button: Generates
the audit report supporting the
calculations.
7. Click the Excluded Grants Report button: Generates the report of all grants
(assumed and/or modified) that have been excluded from the calculations. MPA
Grants will not show up under this report.