Running the Stock Action Process

This topic provides an overview of the Stock Action process and discusses how to run the stock action process.

Page Name

Definition Name

Usage

Process Stock Action-Work List Page

ST_ACTN_PRC_WL

Process stock actions received from the worklist.

Process Stock Action-Manual Page

ST_ACTN_PRC_MNL

Reverse previously processed stock actions or enter actions manually.

Administering the stock action workflow consists of reviewing and processing the stock actions you've received from the worklist. You can reverse or adjust previously processed stock actions or enter actions manually.

Processing Stock Actions

The type of stock action and the rules defined for that stock action control how option grants are modified. The system checks to see if the stock action has not already been processed, then it processes the stock action according to the rules that you defined.

For a Termination stock action, the following occurs:

  1. Adjust the vesting schedule.

    If the grant allows immediate vesting upon termination, a new vesting schedule is produced with all unvested shares vested as of the employee's last active day. If the grant is an ISO (incentive stock option), run the ISO Limit report for the optionee. If the termination occurs while the optionee is on leave, the system checks to see if the vesting period should be deferred.

  2. Cancel the unvested shares.

  3. Set the stock option expiration date for the termination.

  4. For ISO options, set the ISO exercise as NQ date.

For a Leave of Absence stock action, the following occurs:

  1. Verify that the previous stock action was not a leave of absence.

    If the previous stock action was a leave of absence, the system cannot process another leave of absence stock action until the individual returns from the leave. You receive a message that it could not process this stock action.

  2. Suspend vesting, if the plan rules indicate to do so.

  3. Suspend the exercise, if the plan rules indicate to do so.

  4. Stage the grant so that vesting is deferred, if required, when the optionee returns from leave or terminates.

For a Return from Leave stock action, the following occurs:

  1. Verify that the previous stock action was a leave of absence.

    If the previous stock action was not a leave of absence, the system cannot process a return from leave of absence stock action. You receive a message that it could not process this stock action.

  2. Adjust the vesting schedule.

    If the return from leave occurs after the deferral grace period, calculate the amount of time the employee was on leave by the difference between the leave of absence stock action date and the return from leave stock action dates. The vesting schedule is deferred for the amount of time that the optionee was past the grace period. If the grant is an ISO, run the ISO Limit report for the optionee.

Processing Reversals

Sometimes you must reverse a stock action process. The system confirms that the stock action and stock action dates on the processed grant match those of the reversal. If you reverse a Return from Leave or a Termination that occurred while on leave, you are essentially reversing the Leave of Absence as well.

Note: Before you run the Stock Action process, set up your Stock Action process table and rules and grant options to optionees.

Use the Process Stock Action-Work List page (ST_ACTN_PRC_WL) to process stock actions received from the worklist.

Navigation:

  • Stock > Grant Transactions > Process Stock Action-Work List

  • You can access this page directly from a worklist created by workflow notification.

Select either an option type or grant number to process, but not both. If you leave both unselected, the system processes all grants related to the stock ID.

Field or Control

Description

Remove from Worklist?

Select to remove this from the worklist and not process the worklist action.

Use the Process Stock Action-Manual page (ST_ACTN_PRC_MNL) to reverse previously processed stock actions or enter actions manually.

Navigation:

Stock > Grant Transactions > Process Stock Action-Manual

Select either an option type or grant number to process, but not both. If you leave both unselected, the system processes all grants related to the stock ID.

Field or Control

Description

Reversal?

Select to reverse a previously processed stock action.