01—Abstract
Summary
Summary of the 8-K filed September 26, 2024. Cited figures are marked; the original filing is the authoritative source.
Roku, Inc. filed this Form 8-K on September 26, 2024 to disclose changes to its Executive Supplemental Stock Option Program, approved by the Compensation Committee of the Board of Directors on September 23, 2024.
The amended program lets employees at or above the level of Senior Vice President, including certain executive officers but excluding the Chief Executive Officer ("Eligible Executives"), elect annually to reduce their base salary in exchange for a series of monthly grants of fully vested non-statutory stock options under the Amended and Restated 2017 Equity Incentive Plan. The amended program takes effect January 1, 2025, and remains in effect until modified or revoked by the Board or the Compensation Committee. Under the structure, the number of options granted each month equals the monthly dollar amount of salary reduction divided by the Fair Market Value (the Nasdaq closing price on the grant date) divided by a Stock Option Ratio set by the Board or Compensation Committee, rounded down to the nearest whole share.
Enrollment must be completed during the last open trading window of the preceding calendar year, and elections cannot be changed after the enrollment deadline. Withdrawal is restricted to open trading windows, is limited to situations of unforeseeable emergency, and bars re-enrollment for that calendar year. Grants are made on the first trading day of each month, subject to a deferral when the date falls within a Filing Period around periodic reports or material 8-K filings.
Options vest on the grant date, carry an exercise price equal to Fair Market Value, and are exercisable for up to ten years. The filing also lists the enrollment form and form of option agreement and grant notice as exhibits, with the option agreement form incorporated by reference from Roku's Form 10-K filed February 18, 2022. The filing does not state any financial results or dollar amounts for the program's cost or participation.
02—Key points
Key Highlights
- The Compensation Committee approved changes to the Executive Supplemental Stock Option Program on September 23, 2024, effective January 1, 2025.
- Eligible Executives are employees at or above Senior Vice President level, including certain executive officers, excluding the CEO.
- Participants can elect annually to reduce base salary in exchange for monthly grants of fully vested non-statutory stock options under the Amended and Restated 2017 Equity Incentive Plan.
- Option count is calculated by dividing the monthly salary reduction by the Fair Market Value divided by a Stock Option Ratio, rounded down to the nearest whole share.
- Enrollment must be completed during the last open trading window of the prior year, and elections cannot be changed once the deadline passes.
- Withdrawal is limited to open trading windows, no material non-public information, and unforeseeable emergencies, with no re-enrollment for that calendar year.
- Monthly grants are made on the first trading day of each month, deferred if the date falls within a Filing Period around periodic or material 8-K reports.
03—Questions
Frequently Asked Questions
Who is eligible to participate in the Amended Program?
Employees at or above the level of Senior Vice President, including certain executive officers, are eligible. The Chief Executive Officer is excluded.
How are the number of stock options determined?
The number equals the monthly dollar amount of base salary reduction divided by the quotient of the Fair Market Value (the Nasdaq closing price on the grant date) divided by the Stock Option Ratio, rounded down to the nearest whole share. The filing gives an example using a $20,000 monthly reduction and a $50.00 Fair Market Value.
Can participants change or withdraw from their elections?
Annual election amounts cannot be changed after the enrollment deadline. Withdrawal is permitted only during an open trading window, when the executive has no material non-public information, and due to an unforeseeable emergency. Withdrawal bars re-enrollment for that calendar year.
When and at what price are the options granted and when do they vest?
Grants occur on the first trading day of each month, subject to deferral if that date falls within a Filing Period. Options are fully vested on the grant date, have an exercise price equal to Fair Market Value, and are exercisable for up to ten years regardless of employment status.
04—Continue