8x8 2014 Annual Report Download - page 64

Download and view the complete annual report

Please find page 64 of the 2014 8x8 annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

In October 2013, the board of directors approved the modification of unvested stock options to purchase 74,479 shares of common stock and
unvested stock purchase rights totaling 37,000 shares of common stock held by the Company's president upon his resignation. The options held
by the Company's president upon his resignation, taken as a whole, had a weighted average exercise price of $4.05 per share and range from
$2.72 to $5.87 per share, and a weighted average remaining vesting term of 0.5 years. Approximately $1,068,000 of the $7,595,000 of stock-
based compensation charge in fiscal year 2014 applied to the options held by the former president of the Company and was recorded in general
and administrative expenses.
Stock-based compensation expense recognized in the Consolidated Statements of Operations for fiscal 2014, 2013 and 2012, was measured
based on ASC 718 criteria. Compensation expense for all stock-based payment awards are recognized using the straight-line single-option
method and includes the impact of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if
necessary, in subsequent periods if actual forfeitures differ from those estimates.
The following table summarizes stock-based compensation expense (in thousands):
COMPREHENSIVE INCOME
Comprehensive income, as defined, includes all changes in equity (net assets) during a period from non-owner sources. The difference between
net income and comprehensive income is due to foreign currency translation adjustments and unrealized gains or losses on investments classified
as available-for-sale. Comprehensive income is reflected in the consolidated statements of comprehensive income.
59
Years Ended March 31,
2014
2013
2012
Cost of service revenue
$
372
$
211
$
129
Cost of product revenue
-
-
-
Research and development
967
428
260
Sales and marketing
2,217
1,363
859
General and administrative
4,039
632
258
Total stock
-
based compensation expense
related to employee stock options
and employee stock purchases, pre
-
tax
7,595
2,634
1,506
Tax benefit
-
-
-
Stock
-
based compensation expense related to
employee stock options and employee
stock purchases, net of tax
$
7,595
$
2,634
$
1,506