The Art of Taming a Multi-plan, Global ESPP Veena Bhatia, Senior Manager, Stock Plan Services, Gilead Sciences, Inc. Hans de Jong, GF HR Total Reward, LM Ericsson AB John Hammond, President, bendystraw llc Mona Hanes, Senior Executive, North America, Global Shares Erin Madison, Manager, Stock Plan Services, Broadcom
Agenda Introduction Implementation Ongoing data movement and upkeep Communication Compliance Non-routine struggles Wrap-up
Ericsson Match Plan Structure 3 Plans Stock Purchase Plan All employees 1-1 match Key Contributor Retention Plan Up to 10% of workforce 1 additional match share Quick Facts (all ESPP) # of Countries 105 Eligible 107,000 Participation 32,000+ (30%) Contribution Rate Up to 7.5% Purchase Period Hold Period Financing Quarterly 3 year Treasury Stock (currently compares cost with equity swap agreement)
Ericsson Executive Performance Stock Plan Up to.5% of the workforce Strictly performancebased Match ratios CEO 0-9 shares Executive Management 0-6 shares Senior Management 0-4 shares Administered Quick Facts (all ESPP) Outsourced Internal Support Group Administrator 3 FTE Support Administrators Shares utilized Cost LTV 2014 27.6 M LTV 2014 Estimated between SEK 1,126 million and SEK 1,984 million (over 2014 2018 uneven). (Approx. 120 210 M)
Broadcom Employee Stock Purchase Plans US 423 Plan International Plan Pooled share reserve Increases every January 24-month fixed offering periods (reset provision) 15% discount with a look-back Quick Facts (all ESPP) # of Countries 22 Eligible 13,000 Participation 89% Contribution Rate 1 15% Purchase Period 6 month Hold Period N/A Financing Newly Issued
Broadcom Employee Stock Purchase Plans (cont.) Decreases and withdrawals only Quarterly enrollment windows Most countries eligible Exclude Italy, Brazil, Turkey, Japan Quick Facts (all ESPP) Administered Outsourced Internal Support Shares utilized Cost 5staff (all equity) FY 2014: 6 M FY 2014: $43.7 M
Gilead Sciences, Inc. Employee Stock Purchase Plans US 423 Plan International Plan 24-month rolling offering periods (reset provision) 15% discount with a look-back Quick Facts (all ESPP) # of Countries ESPP: 32 Eligible 7,500 Participation 87% Contribution Rate 1 15% Purchase Period 6 months Hold Period N/A Financing Treasury shares
Gilead Sciences, Inc. Employee Stock Purchase Plans (cont.) Increases, decreases and suspension of contribution percentage Quarterly enrollment windows Most countries eligible Administered Internal Support Quick Facts (all ESPP) In house 5 total all equity 1 ESPP Specialist Shares FY 2014: 2.5M granted/purchased Expense FY 2014: $34M (Approx. 31.3 M)
Implementation New Plan Mirror plan creation Changes in plan structure Changing Providers Record retention record retention record retention In-house copy of data ideal US sec. 423 plans with multi-purchase offerings can be extra messy Move shares or records-only
Employee One global SAP HRMS Ericsson De-centralized Operations model Group stake holders Group Admin. LPA s Local Plan Local Local Plan Plan Admin. Admin. Admin. 100+ times same routine Contributions Eligibility Leavers/ Transfers Service provider Static Key plan operation data
Employee One global SAP HRMS Ericsson Global Operations model Group Admin. Local Plan Admin. 100+ Group stake holders Contributions Eligibility Leavers/ Transfers Service provider Static Key plan operation data
Data Movement and Upkeep Frequency of upkeep / getting detail from local payrolls Demographic/eligibility data Mobile employees Exchange Rates Reporting Single vs. multi-plan differences
Communication Centralized vs. decentralized From the parent corporation General forms of communication Selling vs. factual approach Vendor and company communication responsibility How much and how often? EU Prospectus US Prospectus Translations
Compliance Legal and regulatory compliance and financial authorities approval Ericsson 90 countries to start; today 105 Globalized processes (only deviations where required by legislation) vs. country-specific processes
Compliance Areas where multi-plan has helped Israel, Hong Kong Excluded countries Boots on the ground China, Malaysia Employee Tax Withholdings Decentralized?
Additional Projects Just for Fun Adding new countries Financial forecasting & reporting Monthly and annual tax withholding reporting Differing requirements by country
Wrap-Up - Top Recommendations
Questions
Thank You Mona Hanes Global Shares mhanes@globalshares.com Erin Madison Broadcom emadison@broadcom.com Veena Bhatia Gilead Sciences, Inc. veena.bhatia@gilead.com John Hammond bendystraw llc jhammond@bendystrawllc.com Hans de Jong LM Ericsson AB hans.de.jong@ericsson.com