PeopleSoft Stock Administration 9.1 PeopleBook

Administering Grants

This chapter provides an overview of administering grants and discusses how to:

Create, update, and view grants.
Modify a group of grants.
View grant processing results.

Understanding Grant Administration

This section provides an overview of grant administration and lists prerequisites and common elements.

Once you establish your stock option plans and allocate funds to them, you're ready to grant stock options to your optionees.

You can grant stock options to your participants in three ways:

Process grants awarded through your variable compensation plan.
Award grants from an individual stock option plan through an online transaction.
Replace an existing grant with a new grant during a reprice.

By using variable compensation, much of the process is automated. But you can still make adjustments and grant individual grants as necessary.

Prerequisites

Before you begin granting stock options, you should:

Create the vesting schedules.
Set up your stock option plans.
Create your grant reasons.
Set up agreements.
Set up the default tax tables.
Add insider data.
Add issuance instructions.
Enter daily prices.
Allocate shares to the stock option plan and variable compensation plan.
Receive variable compensation awards.

Common Elements Used in This Chapter

Agreement ID	Select a grant agreement to use for this grant. If you selected a Parameter ID its agreement ID is the default. You can select another from the available options.
Employee Information	This group box displays employee information as of the grant date.
Exercise Before Vest	If the option plan allows exercise before vesting, you can select this check box. If the option type is RSA this check box is selected.
Expire Basis	Displays the value that is associated with the option parameter ID. You can select Grant Date, Grant Date - 1, Vest Date, or Vest Date - 1 to indicate the date used to calculate the start of the option life months.
Grant Date	Defaults to the payout period's end date associated with the payout period ID or the VC plan ID. You can change it, but the date must be between the payout period's begin date and the end date.
Grant FMV	Displays the Grant FMV calculated based on the Daily Prices table and defined using the Stock Option Plan Rules - FMV Rules page.
Grant Number	Displays NEW when you enter a grant. When you save, the system generates a sequential grant number from the last grant number stored on the Stock table.
Grant Price	The system default is the Grant FMV (fair market value) calculated based on the Daily Prices table and defined in the Stock Option Plan Rules - FMV Rules page. You can change this amount. If the option type is ISO, the grant price cannot be less than the FMV on the grant date. If the optionee is a 10% shareholder, the grant price of an ISO/ISAR grant has to be at least the Grant FMV multiplied by the 10% shareholder FMV rule on the governing body rules table.
Grant Status	Valid values are Active, Void, and Pending.
Life - Months	Displays the value associated with the option parameter ID, which you can change. Enter the number of months that the option remains outstanding. If the option type is ISO or ISO/SAR, the maximum life months is defined on the Governing Body Rules table. The value in this field cannot exceed the number in the Governing Body Rules table.
Shares Granted	Number of shares to grant to an individual.
Stock Plan	Plan from which you want to grant the options. Once you save the grant and it is active, the unallocated plan shares balance on the Option Plan component (STOCK_PLAN_BAL) changes to reflect the grant.
Transfer Option	If the option plan allows options to be transferred, this field is available. Select to allow the options to be transferred. This field is not available if the option type is ISO or ISO/SAR. This field is for information only.
Vesting Begin Code	Displays the value that is associated with the vesting schedule ID.
Vesting Schedule ID	Displays the value associated with the option parameter ID, which you can change.

Creating, Updating, and Viewing Grants

This section discusses how to:

Enter, update, and view the basic parameters of a grant.
Create vesting schedules and validate ISO limits.
Record grant cancellation, human resources, and repricing information.

Pages Used to Create, Update, and View Grants

Page Name	Definition Name	Navigation	Usage
Maintain Grants - General	ST_GRANT	Stock, Grants, Maintain Grants, General	Award a new grant or update an existing grant from an individual plan to an optionee. You must first set up and allocate stock to your stock option plans.
Maintain Grants - Vesting	ST_GRANT_VEST	Stock, Grants, Maintain Grants, Vesting	Create or update a vesting schedule that is associated with a grant and validate ISO limits.
Maintain Grants - Miscellaneous	ST_GRANT_MISC	Stock, Grants, Maintain Grants, Miscellaneous	Record grant cancellations, human resources, and repricing information for a selected optionee. You can also view variable compensation information.
Maintain Grants - Valuation	ST_GRANT_VALUE	Stock, Grants, Maintain Grants, Valuation	View valuation information such as shares valued, grant FMV, expected life years.
Grant Comments	ST_GRANT_CMT_SEC1	Stock, Grants, Maintain Grants, General Click the Comments link.	Add comments for a grant.
Shares Granted	ST_RUNCTL_STOP002	Stock, Option Reports, Grant Transactions, Shares Granted	Define run parameters for the Shares Granted report (STOP002). This report displays the options granted during a specified date range. Use the report to verify data entry, prepare the annual report, prepare forms 10-K and 10-Q, and reconcile the plan summary.

See Also

Viewing Grant Valuations

Entering, Updating, and Viewing the Basic Parameters of a Grant

Access the Maintain Grants - General page (Stock, Grants, Maintain Grants, General).

Stock ID

Select the stock ID. The system displays the associated Currency Code associated with the stock ID.

Stock Plan

Select the stock plan from which you want to grant the options. Once you save the grant and it is active, the unallocated plan shares balance on the Option Plan component (STOCK_PLAN_BAL) changes to reflect the grant.

Status Date

Displays the date that the status was last changed and saved.

Grant Date

Enter the grant date. You get a warning if the individual is not active as of this date.

Grant Number

Displays the ISO limit grant number if the ISO grant is over the ISO limit and an NQ grant is created. This number represents the associated grant number of the ISO and NQ pair of grants. If this is the ISO grant, the NQ grant number appears. If this is the NQ grant, the ISO grant number appears.

Shares Granted

Displays the total shares of the two grants if the ISO limit is reached and two grants, one ISO and one NQ, are created.

Option Parameter ID

Option parameter IDs are defined on the Stock Option Plan Rules - Option Parameters page. The predefined values default to the following fields: Option Type, Expire Basis, Life Months, Vesting Schedule, and Agreement ID. You can change the default values. Option Parameter IDs are not required and can only be used to set default values for a new grant.

Option Type

The default value is the option type associated with the option parameter ID, if entered.

Agreement Status

Select Accepted Offer, Outstanding Offer, or Rescinded Offer to indicate the status of the agreement. If you select Rescinded Offer, you must set the cancel reason to Rescind and enter a cancellation date on the Stock Option Grants - Miscellaneous page.

Agreement Date

Enter the date that the agreement was accepted or the date when the grant was rescinded.

Retirement Eligible

The Stock – Retirement Eligibility (ST_RET_ELIG) Application Engine process selects this check box if the optionee is eligible for either normal retirement or early retirement, based on the retirement eligibility rules that you specify on the Stock Option Plan Rules - General page.

See Defining General Rules for a Stock Option Plan, Processing Retirement Eligibility.

Note. The Stock – Retirement Eligibility process does not update this check box after a grant expires. So if a grant expires before an optionee become eligible for retirement, the check box will never be selected, even when the optionee becomes eligible for retirement.

Retire Eligible Dt (retire eligible date)

The Stock – Retirement Eligibility process enters the first date that the optionee met retirement eligibility criteria or, if this date is prior to the grant date, the process enters the grant date.

Forecast Retirement Eligible

The Stock – Retirement Eligibility (ST_RET_ELIG) Application Engine process selects this check box if the optionee meets the forecast eligible age and service requirements that you specify on the Stock Option Plan Rules - General page. These age and service requirements help you identify optionees who are nearing retirement eligibility so that you can include them in your forecasts.

This check box is mutually exclusive with the Retirement Eligible check box; once an optionee becomes eligible for retirement, the system deselects the Forecast Retirement Eligible check box.

See Also

Calculating Stock Balances

Creating a Vesting Schedule and Validating ISO Limits

Access the Maintain Grants - Vesting page (Stock, Grants, Maintain Grants, Vesting).

To create a vesting schedule and validate ISO limits:

Select a vesting schedule ID or manually define the individual vesting periods.
Complete other fields applicable to the vesting schedule.
For ISO options, click the Validate ISO button to determine if the value of the shares first exercisable exceeds the 100K limit.

Vest Effective Date	When you enter a new grant, the system default is the grant date. When you later make an adjustment, enter a new vest effective date.
Sequence	Displays a sequence number if you make a change to the vesting schedule.
Vest Reason	When you enter a new grant, the system default is the vesting reason Initial Vesting. To change the vesting schedule after the grant is saved, enter a new set of rows and select a different Vest Reason. Values are Initial Vesting, Correction, Merger/Acquisition, Performance Vesting, Reprice, Return from Leave, and Termination.

Vesting Schedule

The vesting schedule associated with the stock option plan is the default.

Create Vesting Schedule	If you entered a vesting schedule ID, you can click this button to create the vesting schedule.
Vesting Date	Displays the vesting date for each period. You can change the date, however, the date cannot exceed the life of the option or be before the date of the grant or after the expiration date.
Shares Vested	Displays the number of shares that vest in each period. You can change the number of shares, but the total of all the shares must equal the total shares granted.
Expiration Date	Calculated from the Expire Basis and Life Months fields. You can change the date, however, if the option type is ISO, the date cannot exceed the option life limit set up on the Governing Body Rules - Stock Option Rules page.
Term Expire Date	Available when the option is cancelled due to termination. Enter the grant expiration date.

See Also

Validation of ISO Limits

Recording Grant Cancellation, Human Resources, and Repricing Information

Access the Maintain Grants - Miscellaneous page (Stock, Grants, Maintain Grants, Miscellaneous).

Variable Comp

These fields are populated if the grant was awarded through variable compensation.

Cancellation

A grant can be cancelled automatically as a result of a reprice or the processing of a termination stock action. You can manually enter information for rescinded grants as well as repricings and terminations.

Cancel Reason	Select a reason for the cancellation. Values are Reprice, Rescind, and Terminated. If you select Rescind, the Agreement Status field must be Rescind also.
Shares Cancelled	Displays the number of shares cancelled.

Reprice

If this grant is the result of a stock reprice, the fields in this group box are populated. You can also enter the information manually if the grant was repriced manually. If you enter information, be sure that both the grant that is repriced and the new grant are updated correctly as would have been done by the Reprice process.

Reprice Grant Number

The system enters the number of the grant that was repriced and replaced by this grant.

HR Integration

If the grant is changed because of a stock action, the HR Integration fields are populated. You can change the default values. If you enter the information manually ensure that the correct fields are modified and the correct validation is performed as would have been done by the Stock Action process.

ISO as NQ Date

Applies if the stock action is termination and the grant is ISO.

Modifying a Group of Grants

This section provides an overview of grant modifications and discusses how to:

Select grants to modify.
Select optionees whose grants you want to modify.
Modify grant parameters.

Understanding Grant Modifications

The types of adjustments that you can make to grants depend on the source of the grant, the option type, and the transactions that have occurred since the grant date. Use the Modify Grants component to modify a group of grants using a batch process. (Use the Grants component to modify an individual grant.)

Pending grants are counted toward the ISO limit if the pending grant is the grant being generated. During the Modify Grants process, or an online process of changing the grant status from Pending to Active, the ISO validation occurs again, which may change the ISO/NQ split if an employee has more than one ISO grant in Pending status.

See Also

Validation of ISO Limits

Creating, Updating, and Viewing Grants

Pages Used to Modify Grants

Page Name	Definition Name	Navigation	Usage
Modify Grants - Criteria	ST_RUNCTL_MOD_GRNT	Stock, Grants, Modify Grants, Criteria	Enter the criteria to select the grant or grants to modify.
Modify Grants - Optionees	ST_MOD_OPTIONEES	Stock, Grants, Modify Grants, Optionees	Specify the optionees whose grants you want to modify.
Modify Grants - Modify	ST_MOD_GRANT	Stock, Grants, Modify Grants, Modify	Modify the grant parameters.

Selecting Grants to Modify

Access the Modify Grants - Criteria page (Stock, Grants, Modify Grants, Criteria).

Enter the selection criteria for the grants you want to modify.

Note. To start the Modify Grants process, click the Run button on any page in this component.

Selecting Optionees Whose Grants You Want to Modify

Access the Modify Grants - Optionees page (Stock, Grants, Modify Grants, Optionees).

Optionees Online

Click to populate the grid with grant information matching the criteria entered on the Modify Grants - Criteria page. You can then review the list of optionees and, if necessary, add or delete rows before you run the Modify Grants process.

Optionee Report

Click this button to indicate that you want to generate a text file that lists the grants that meet the criteria on the Modify Grants - Criteria page. The system does not create the text file until you run the Modify Grants (ST_MOD_GRANT) process. If you want to review the report before modifying grants, first run the Modify Grants process without specifying any modification. After you review the text file, you can enter the grant modification parameters before rerunning the Modify Grants process to make the modifications.

Optionees - General Tab

The Optionees grid is populated when you click the Optionees Online button.

EmplID, Name, and Grant Number

These values identify the grant to be modified.

Grant Info 1 Tab

This tab displays the option type, grant reason, and grant price for the grant.

Grant Info 2 Tab

This tab displays the vesting ID for the grant. It also indicates whether the grant can be exercised before vest or transferred.

Agreement Tab

This tab displays the agreement ID, agreement status and date for the grant.

Variable Comp Tab

This tab displays the variable compensation plan ID, period ID, group ID, and employee record number for the grant.

Modifying Grant Parameters

Access the Modify Grants - Modify page.

Enter data in only those fields that you want to modify. For example, to change the agreement ID, make your selection in the Agreement ID field and do not touch the other fields.

Viewing Grant Processing Results

This section discusses how to view processing messages after you run the Generate Grants process or the Modify Grants process.

Page Used to View Grant Processing Results

Page Name	Definition Name	Navigation	Usage
Review Grant Messages	ST_GRNT_MESSAGE	Stock, Grants, Review Grant Messages	View the messages from the Generate Grants or Modify Grants process.

Viewing Grant Messages

Access the Review Grant Messages page (Stock, Grants, Review Grant Messages).

Severity	Displays the type of message produced: Error, Warning, and Message.
Message Data	Displays the field values that are associated with the message. Up to four fields can be displayed.

Stock ID	Select the stock ID. The system displays the associated Currency Code associated with the stock ID.
Stock Plan	Select the stock plan from which you want to grant the options. Once you save the grant and it is active, the unallocated plan shares balance on the Option Plan component (STOCK_PLAN_BAL) changes to reflect the grant.
Status Date	Displays the date that the status was last changed and saved.
Grant Date	Enter the grant date. You get a warning if the individual is not active as of this date.
Grant Number	Displays the ISO limit grant number if the ISO grant is over the ISO limit and an NQ grant is created. This number represents the associated grant number of the ISO and NQ pair of grants. If this is the ISO grant, the NQ grant number appears. If this is the NQ grant, the ISO grant number appears.
Shares Granted	Displays the total shares of the two grants if the ISO limit is reached and two grants, one ISO and one NQ, are created.
Option Parameter ID	Option parameter IDs are defined on the Stock Option Plan Rules - Option Parameters page. The predefined values default to the following fields: Option Type, Expire Basis, Life Months, Vesting Schedule, and Agreement ID. You can change the default values. Option Parameter IDs are not required and can only be used to set default values for a new grant.
Option Type	The default value is the option type associated with the option parameter ID, if entered.
Agreement Status	Select Accepted Offer, Outstanding Offer, or Rescinded Offer to indicate the status of the agreement. If you select Rescinded Offer, you must set the cancel reason to Rescind and enter a cancellation date on the Stock Option Grants - Miscellaneous page.
Agreement Date	Enter the date that the agreement was accepted or the date when the grant was rescinded.
Retirement Eligible	The Stock – Retirement Eligibility (ST_RET_ELIG) Application Engine process selects this check box if the optionee is eligible for either normal retirement or early retirement, based on the retirement eligibility rules that you specify on the Stock Option Plan Rules - General page. See Defining General Rules for a Stock Option Plan, Processing Retirement Eligibility. Note. The Stock – Retirement Eligibility process does not update this check box after a grant expires. So if a grant expires before an optionee become eligible for retirement, the check box will never be selected, even when the optionee becomes eligible for retirement.
Retire Eligible Dt (retire eligible date)	The Stock – Retirement Eligibility process enters the first date that the optionee met retirement eligibility criteria or, if this date is prior to the grant date, the process enters the grant date.
Forecast Retirement Eligible	The Stock – Retirement Eligibility (ST_RET_ELIG) Application Engine process selects this check box if the optionee meets the forecast eligible age and service requirements that you specify on the Stock Option Plan Rules - General page. These age and service requirements help you identify optionees who are nearing retirement eligibility so that you can include them in your forecasts. This check box is mutually exclusive with the Retirement Eligible check box; once an optionee becomes eligible for retirement, the system deselects the Forecast Retirement Eligible check box.