Participant Education, an SPS/GZ consulting service - Stock Plan

Copyright © 2011 Stock Plan Solutions/Green Zapato LLC

ParticipantEducation

An SPS/GZ consulting service

Rick Zatz, CEP, Principal

Mary Pat Wood, CPA, CEP, Principal

Page 2 Copyright © 2011 Stock Plan Solutions/Green Zapato LLC

Agenda

Introductions

SPS/GZ: Who we are

Overview of SPS/GZ services

SPS/GZ’s education philosophy

Benefits of robust education program

SPS/GZ’s solution for participant education

Overview of SPS/GZ’s education presentations

Questions and contact information


Introductions

Rick Zatz (Co-Founder)Rick is a Certified Equity Professional (CEP) with 15 years of experience instock plan administration. He managed the stock plan administrationdepartment of a global technology company before founding SPS/GZ. Rick isrecognized as a leader in the industry and has served on many panels related tobest practices in stock plan administration and curriculum for the CEP program.He holds a B.A. in journalism from Indiana University.

Mary Pat Wood (Co-Founder)Mary Pat is a Certified Public Accountant (CPA) and a Certified EquityProfessional (CEP) with 18 years of experience in stock plan administration,accounting and financial reporting, SEC compliance, financial forecasting andinvestor relations. She was formerly an auditor for a “Big Four” accounting firmand served as External Reporting Manager at a global software company and ata national mortgage company, where she managed the Initial Public Offering.Mary Pat is a recognized expert in the accounting, reporting and tax aspects ofequity compensation administration. She holds a B.S. in Accountancy fromDePaul University.


Who we are

A full-service administration outsourcing and consulting firm

Staffed by seasoned certified professionals (CEPs and CPAs)

Privately held company

Located in Chicago

Founded in 2001

Mission: To provide our clients with expertise and guidance from equitycompensation professionals with “real-world experience” who can address thechanging landscape of administration, best practices, accounting regulations anda multitude of complex issues born out of IPOs, mergers and the evolvingSarbanes-Oxley environment.


Our services

Outsourcing

Complete, reliable outsourcingservices for equity compensationprograms (Stock Options, RestrictedStock Awards/Units, StockAppreciation Rights and EmployeeStock Purchase Plans)

Plan implementation and dailyadministration

ASC Topic 718/FAS 123(R)valuations and financial reporting

SEC, IRS and FASB compliance

Consulting

IRC 6039 mailings and filings

Database implementations and thirdparty database audits

ASC Topic 718/FAS 123(R)/StockPlan accounting consulting

Customized education presentationsto plan participants

Customized training

Best practices consultation

Remote, temporary fill-inadministration


Education philosophy

Nearly all companies have mandatory employee benefit orientation meetings fornew employees. Typically, these meetings cover health insurance, 401(k) andother programs available to employees.

Rarely, it seems, are equity compensation programs part of these orientationmeetings. This means a significant part of employees’ compensation package isnot explained in a comprehensive way so that both equity plan savvy anduninitiated employees can understand and value their stock plans and makeinformed decisions about their participation.

SPS/GZ believes that well-designed equity compensation plans that also arewell communicated on a regular basis to employees can bring great benefit toboth the company and the employees.

This is why SPS/GZ offers a variety of customized education choices that canstand alone or be combined to provide a robust education program. Thesesolutions are developed by seasoned and certified stock plan andcommunication professionals.


Education benefits

Here are some benefits to a robust education program:

Retain top-notch employees: Equity compensation programs are a tool that companiesuse to attract and retain high-caliber employees. Employees who understand theseprograms will more likely be the ones who ask: What am I leaving on the table if I leave?

Improved morale: Educated employees will place a higher value on their equity benefitsand appreciate how it impacts their total compensation package.

Employees as owners: Educated employees will make smarter decisions about theirparticipation in company stock plans, which helps align the goals of the company with theiremployee shareholders.

Return on expense and cash flow: Under ASC Topic 718 (formerly FAS123(R)), stockplans must be taken as an expense. Given that these plans are no longer “free” tocompanies, and factoring in the cost to administer them, it makes sense to haveemployees understand and value the programs that are now even more costly to theiremployer. Additionally, employers receive greater cash flow from increased participation.


Education solutions

Clients may select any or all of the education solutions offered by SPS/GZ:

Orientation presentations: SPS/GZ will create a 30-minute slide show withaudio that can be shown during orientation meetings. The slides and audio arecustomized. This is a summary overview and does not cover as many details asthe on-site or webcast presentations. These can be updated as requested.

On-site presentations: SPS/GZ will develop and deliver on-site presentations.The presentations are customized and are delivered so that knowledgeableemployees are not bored and the inexperienced employees can understandhow their stock plans work in general and in detail. These presentations can bedelivered by SPS/GZ once, on a regular basis, or at strategic times.

Live webcast presentations: Similar to on-site presentations, though not aseffective. The webcasts can replace the live presentations or be combined withthe live presentations to reach employees in more remote locations.

Documentation: SPS/GZ can develop customized documents(FAQs, forms, etc.) that clients can post online or distribute.


Education overview

SPS/GZ develops customized presentations and documents for:

Stock Options (both Incentive and Non-Qualified) Restricted Stock Awards (RSAs) Restricted Stock Units (RSUs) Employee Stock Purchase Plans (ESPPs) qualified under IRC 423

Presentations cover:

Overview of stock plans and why company includes them as part of thecompensation package. How stock plans work in general (grants, vesting, exercises, dispositions,cancellations, etc.). The details of how stock plans work specifically at the client company (taxpayments, brokerage, terminations, etc.).


Education overview

For on-site or live webcast presentations, SPS/GZ:

Does up to three single-topic presentations per day.

Does up to two double-topic presentations per day.

Includes brokerage overview if information is provided by client.

Includes list of important contacts, dates and deadlines for employees.

Includes time for Q&A session after each presentation.

Includes time for employees to speak individually with SPS/GZ professionals.

Does NOT include investment, tax or accounting advice to employees.

Copyright © 2011 Stock Plan Solutions/Green Zapato LLC

Call us at (312) 836-9931or visit our website at

www.spsgz.com

Rick Zatz, CEP, Principal

Mary Pat Wood, CPA, CEP, Principal

Thank you!

www.spsgz.com

Documents

Participant Education, an SPS/GZ consulting service - Stock Plan