Citrix 2014 Annual Report Download - page 90

CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F-22
certain of the Company’s acquisitions, the Company has assumed certain plans from acquired companies. The Company’s
Board of Directors has provided that no new awards will be granted under the Company’s acquired stock plans. Awards
previously granted under the Company's superseded and expired stock plans that are still outstanding typically expire between
five and ten years from the date of grant and will continue to be subject to all the terms and conditions of such plans, as
applicable. The Company’s superseded and expired stock plan includes the Amended and Restated 1995 Stock Plan and the
Amended and Restated 2005 Equity Incentive Plan.
Under the terms of the 2014 Plan, the Company is authorized to grant incentive stock options (“ISOs”), non-qualified
stock options (“NSOs”), non-vested stock, non-vested stock units, stock appreciation rights (“SARs”), and performance units
and to make stock-based awards to full and part-time employees of the Company and its subsidiaries or affiliates, where legally
eligible to participate, as well as to consultants and non-employee directors of the Company. SARs and ISOs are not currently
being granted. Currently, the 2014 Plan provides for the issuance of a maximum of 29,000,000 shares of common stock. In
addition, shares of common stock underlying any awards granted under the Company’s Amended and Restated 2005 Equity
Incentive Plan, as amended, that are forfeited, canceled or otherwise terminated (other than by exercise) are added to its shares
of common stock available for issuance under the 2014 Plan. Under the 2014 Plan, NSOs must be granted at exercise prices no
less than fair market value on the date of grant. Non-vested stock awards may be granted for such consideration in cash, other
property or services, or a combination thereof, as determined by the Company’s Compensation Committee of its Board of
Directors. Stock-based awards are generally exercisable or issuable upon vesting. The Company’s policy is to recognize
compensation cost for awards with only service conditions and a graded vesting schedule on a straight-line basis over the
requisite service period for the entire award. As of December 31, 2014, there were 36,011,864 shares of common stock reserved
for issuance pursuant to the Company’s stock-based compensation plans, and the Company had authorization under its 2014
Plan to grant stock-based awards covering 27,163,066 shares of common stock.
Under the 2005 ESPP, all full-time and certain part-time employees of the Company are eligible to purchase common
stock of the Company twice per year at the end of a six-month payment period (a “Payment Period”). During each Payment
Period, eligible employees who so elect may authorize payroll deductions in an amount no less than 1% nor greater than 10%
of his or her base pay for each payroll period in the Payment Period. At the end of each Payment Period, the accumulated
deductions are used to purchase shares of common stock from the Company up to a maximum of 12,000 shares for any one
employee during a Payment Period. Shares are purchased at a price equal to 85% of the fair market value of the Company’s
common stock on the last business day of a Payment Period. Employees who, after exercising their rights to purchase shares of
common stock in the 2005 ESPP, would own shares representing 5% or more of the voting power of the Company’s common
stock, are ineligible to participate under the 2005 ESPP. The 2005 ESPP provides for the issuance of a maximum of 10,000,000
shares of common stock. As of December 31, 2014, 3,556,973 shares had been issued under the 2005 ESPP. The Company
recorded stock-based compensation costs related to the 2005 ESPP of $5.2 million, $4.9 million and $4.0 million for the years
ended December 31, 2014, 2013 and 2012, respectively.
Expense Information under the Authoritative Guidance
As required by the authoritative guidance, the Company estimates forfeitures of stock awards and recognizes
compensation costs only for those awards expected to vest. Forfeiture rates are determined based on historical experience. The
Company also considers whether there have been any significant changes in facts and circumstances that would affect its
forfeiture rate quarterly. Estimated forfeitures are adjusted to actual forfeiture experience as needed. The Company recorded
stock-based compensation costs, related deferred tax assets and tax benefits of $169.3 million, $46.9 million and $43.9 million,
respectively, in 2014, $183.9 million, $57.1 million and $55.7 million, respectively, in 2013 and $149.9 million, $46.7 million
and $65.8 million, respectively, in 2012.
The detail of the total stock-based compensation recognized by income statement classification is as follows (in
thousands):
Income Statement Classifications 2014 2013 2012
Cost of services and maintenance revenues $ 2,560 $ 2,540 $ 2,111
Research and development 55,560 63,448 54,616
Sales, marketing and services 61,925 65,549 51,519
General and administrative 49,242 52,404 41,694
Total $ 169,287 $ 183,941 $ 149,940