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This excerpt taken from the WBMD 8-K filed Jul 2, 2009. Accounting
for Stock-Based Compensation
As discussed more fully in Note 12, on January 1,
2006, the Company adopted SFAS No. 123, “(Revised
2004): Share-Based Payment” (“SFAS 123R”),
which replaced SFAS No. 123, “Accounting for
Stock-Based Compensation” (“SFAS 123”) and
superseded APB Opinion No. 25, “Accounting for Stock
Issued to Employees” (“APB 25”). SFAS 123R
requires all share-based payments to employees, including grants
of employee stock options, to be recognized as compensation
expense over the service period (generally the vesting period)
in the consolidated financial statements based on their fair
values. The Company elected to use the modified prospective
transition method and as a result prior period results were not
restated. Under the modified prospective transition method,
awards that were granted or modified on or after January 1,
2006 are measured and accounted for in accordance with
SFAS 123R. Unvested stock options and restricted stock
awards that were granted prior to January 1, 2006 will
continue to be accounted for in accordance with SFAS 123,
using the same grant date fair value and same expense
attribution method used under SFAS 123, except that all
awards are recognized in the results of operations over the
remaining vesting periods. The impact of forfeitures that may
occur prior to vesting is also estimated and considered in the
amount recognized for all stock-based compensation beginning
January 1, 2006.
Prior to January 1, 2006, the Company accounted for
stock-based employee compensation using the intrinsic value
method under the recognition and measurement principles of APB
25, and related
Table of Contents
WEBMD
HEALTH CORP.
NOTES TO
CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
interpretations. In accordance with APB 25, the Company did not
recognize stock-based compensation cost with respect to stock
options granted with an exercise price equal to the market value
of the underlying common stock on the date of grant. As a
result, the recognition of stock-based compensation expense was
generally limited to the expense related to restricted stock
awards and stock option modifications, as well as the
amortization of deferred compensation related to certain
acquisitions in 2000. Additionally, all restricted stock awards
and stock options granted prior to January 1, 2006 had
graded vesting, and the Company valued these awards and
recognized actual and pro-forma expense, with respect to
restricted stock awards and stock options, as if each vesting
portion of the award was a separate award. This resulted in an
accelerated attribution of compensation expense over the vesting
period. As permitted under SFAS 123R, the Company began
using a straight-line attribution method beginning
January 1, 2006 for all stock options and restricted stock
awards granted on or after January 1, 2006, but continued
to apply the accelerated attribution method for the remaining
unvested portion of any awards granted prior to January 1,
2006.
These excerpts taken from the WBMD 10-K filed Feb 27, 2009. Accounting
for Stock-Based Compensation
As discussed more fully in Note 13, on January 1,
2006, the Company adopted SFAS No. 123,
‘‘(Revised 2004): Share-Based Payment”
(“SFAS 123R”), which replaced
SFAS No. 123, “Accounting for Stock-Based
Compensation” (“SFAS 123”) and superseded
APB Opinion No. 25, “Accounting for Stock Issued to
Employees” (“APB 25”). SFAS 123R requires
all share-based payments to employees, including grants of
employee stock options, to be recognized as compensation expense
over the service period (generally the vesting period) in the
consolidated financial statements based on their fair values.
The Company elected to use the modified prospective transition
method and as a result prior period results were not restated.
Under the modified prospective transition method, awards that
were granted or modified on or after January 1, 2006 are
measured and accounted for in accordance with SFAS 123R.
Unvested stock options and restricted stock awards that were
granted prior to January 1, 2006 will continue to be
accounted for in accordance with SFAS 123, using the same
grant date fair value and same expense attribution method used
under SFAS 123,
Table of Contents
WEBMD
HEALTH CORP.
NOTES TO
CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
except that all awards are recognized in the results of
operations over the remaining vesting periods. The impact of
forfeitures that may occur prior to vesting is also estimated
and considered in the amount recognized for all stock-based
compensation beginning January 1, 2006.
Prior to January 1, 2006, the Company accounted for
stock-based employee compensation using the intrinsic value
method under the recognition and measurement principles of APB
25, and related interpretations. In accordance with APB 25, the
Company did not recognize stock-based compensation cost with
respect to stock options granted with an exercise price equal to
the market value of the underlying common stock on the date of
grant. As a result, the recognition of stock-based compensation
expense was generally limited to the expense related to
restricted stock awards and stock option modifications, as well
as the amortization of deferred compensation related to certain
acquisitions in 2000. Additionally, all restricted stock awards
and stock options granted prior to January 1, 2006 had
graded vesting, and the Company valued these awards and
recognized actual and pro-forma expense, with respect to
restricted stock awards and stock options, as if each vesting
portion of the award was a separate award. This resulted in an
accelerated attribution of compensation expense over the vesting
period. As permitted under SFAS 123R, the Company began
using a straight-line attribution method beginning
January 1, 2006 for all stock options and restricted stock
awards granted on or after January 1, 2006, but continued
to apply the accelerated attribution method for the remaining
unvested portion of any awards granted prior to January 1,
2006.
Accounting for Stock-Based Compensation As discussed more fully in Note 13, on January 1, 2006, the Company adopted SFAS No. 123, ‘‘(Revised 2004): Share-Based Payment” (“SFAS 123R”), which replaced SFAS No. 123, “Accounting for Stock-Based Compensation” (“SFAS 123”) and superseded APB Opinion No. 25, “Accounting for Stock Issued to Employees” (“APB 25”). SFAS 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized as compensation expense over the service period (generally the vesting period) in the consolidated financial statements based on their fair values. The Company elected to use the modified prospective transition method and as a result prior period results were not restated. Under the modified prospective transition method, awards that were granted or modified on or after January 1, 2006 are measured and accounted for in accordance with SFAS 123R. Unvested stock options and restricted stock awards that were granted prior to January 1, 2006 will continue to be accounted for in accordance with SFAS 123, using the same grant date fair value and same expense attribution method used under SFAS 123,
Table of ContentsWEBMD HEALTH CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) except that all awards are recognized in the results of operations over the remaining vesting periods. The impact of forfeitures that may occur prior to vesting is also estimated and considered in the amount recognized for all stock-based compensation beginning January 1, 2006. Prior to January 1, 2006, the Company accounted for stock-based employee compensation using the intrinsic value method under the recognition and measurement principles of APB 25, and related interpretations. In accordance with APB 25, the Company did not recognize stock-based compensation cost with respect to stock options granted with an exercise price equal to the market value of the underlying common stock on the date of grant. As a result, the recognition of stock-based compensation expense was generally limited to the expense related to restricted stock awards and stock option modifications, as well as the amortization of deferred compensation related to certain acquisitions in 2000. Additionally, all restricted stock awards and stock options granted prior to January 1, 2006 had graded vesting, and the Company valued these awards and recognized actual and pro-forma expense, with respect to restricted stock awards and stock options, as if each vesting portion of the award was a separate award. This resulted in an accelerated attribution of compensation expense over the vesting period. As permitted under SFAS 123R, the Company began using a straight-line attribution method beginning January 1, 2006 for all stock options and restricted stock awards granted on or after January 1, 2006, but continued to apply the accelerated attribution method for the remaining unvested portion of any awards granted prior to January 1, 2006. This excerpt taken from the WBMD 10-K filed Mar 16, 2006. Accounting
for Stock-Based Compensation
As discussed more fully in Note 12, the Company accounts
for employee options to purchase Company and Emdeon stock and
restricted stock and for employee participation in the Emdeon
employee stock purchase plan using the intrinsic value method
under the recognition and measurement principles of APB Opinion
No. 25, “Accounting for Stock Issued to
Employees” (“APB No. 25”), and related
interpretations. No stock-based employee compensation cost is
reflected in net income (loss) with respect to options granted
with an exercise price equal to the market value of the
underlying common stock on the date of grant. Stock-based awards
to non-employees are accounted for based on provisions of
SFAS No. 123, “Accounting for Stock-Based
Compensation” (“SFAS No. 123”), and
EITF 96-18, “Accounting for Equity Instruments That
Are Issued to Other Than Employees for Acquiring, or in
Conjunction with Selling, Goods or Services.” The following
table illustrates the effect on net income (loss) and pro forma
net income (loss) per common share if
Table of Contents
WEBMD
HEALTH CORP.
NOTES TO
CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
the Company had applied the fair value recognition provisions of
SFAS No. 123 to stock-based employee compensation at
the beginning of each period:
The pro forma results above reflect stock-based compensation
expense related to employee stock options and restricted stock
issued in conjunction with the Company’s IPO from the date
of issuance on September 28, 2005 through December 31,
2005. The pro forma results above are not intended to be
indicative of or a projection of future results. Refer to
Note 12 for assumptions used in computing the fair value
amounts above.
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