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SEC Filings

10-K
TERRAFORM GLOBAL, INC. filed this Form 10-K on 12/21/2016
Entire Document
 

Stock-based compensation expense is recorded as a component of general and administrative expense in the Company’s consolidated statements of operations and totaled $1.6 million for the year ended December 31, 2015No stock-based compensation expense was recognized during the years ended December 31, 2014 and 2013.
Employee benefit related costs, including stock-based compensation costs related to equity awards in the stock of SunEdison and its consolidated subsidiaries, of SunEdison employees who provide services to the Company are allocated to the Company based on the relative percentage of their time that the employee spends providing service to the Company. The amount of stock-based compensation expense related to equity awards in the stock of SunEdison and its consolidated subsidiaries which has been allocated to the Company was $1.5 million for the year ended December 31, 2015 and is reflected in the consolidated statements of operations within general and administrative - affiliate costs and has been treated as an equity contribution from SunEdison on the consolidated statements of stockholders' equity. Similarly, stock-based compensation costs related to equity awards to SunEdison employees in the Company’s stock are allocated to SunEdison based on the relative percentage of their time that the employee spends providing service to SunEdison. The amount of stock-based compensation expense related to equity awards in our stock which has been allocated to SunEdison was $0.3 million for the year ended December 31, 2015 and is recognized as a distribution to SunEdison on the consolidated statements of stockholders' equity with no impact to the Company’s consolidated statements of operations. There were no similar stock-based compensation related distributions to or contributions from SunEdison during the years ended December 31, 2014 or 2013.
Restricted Stock Awards
RSAs provide the holder with immediate voting rights, but are restricted in all other respects until vested. Upon a termination of employment for any reason, any unvested shares of Class A common stock held by the terminated participant will be forfeited. All unvested RSAs are paid dividends and distributions.
The following table presents information regarding outstanding RSAs as of December 31, 2015 and changes during the year then ended, after giving effect to the conversion of restricted Class C common stock to restricted Class A common stock on a 178.8491-for-one basis:
 
 
Number of RSAs Outstanding
 
Weighted Average Grant Date Fair Value Per Share
 
Aggregate Intrinsic Value
(in millions)
Balance at January 1, 2015
 
5,606,918

 
$
0.12

 
 
Granted
 
6,303,519

 
0.21

 
 
Forfeited
 
(4,135,883
)
 
0.15

 
 
Balance at December 31, 2015
 
7,774,554

 
$
0.18

 
$
43.5

As of December 31, 2015, $1.1 million of total unrecognized compensation cost related to RSAs is expected to be recognized over a weighted average period of approximately 3.3 years.
The weighted average fair value of RSAs on the date of grant was $0.21 and $0.12 for the years ended December 31, 2015 and 2014, respectively.
On September 26, 2014 and March 31, 2015, the Company granted 31,350 and 35,245 shares of restricted Class C common stock, respectively (or 5,606,918 and 6,303,519 shares, respectively, of restricted Class A common stock after giving effect to conversion of restricted Class C common stock to restricted Class A common stock on an 178.8491-for-one basis immediately prior to the completion of the IPO). Subject to accelerated vesting upon certain events, 25.0% of the restricted Class A common stock will vest on the first through fourth anniversary of the date of the IPO. The fair value of each grant was determined by using the percentage of shares granted multiplied by the overall fair value of SunEdison’s equity in the Company. In estimating the fair value of the RSAs, the primary valuation considerations were an enterprise value determined from a discounted cash flow of income-based approach, using a present value of after-tax probability weighted equity cash flow of those power plants expected to be included in the IPO, in a projection period extending through December 2024 and a lack of marketability discount of 10.0% and 5.0% for the September 26, 2014 and March 31, 2015 grants, respectively. The discount model used the following assumptions: a time to liquidity event of seven months and three months; a discount rate of 13.0% and 12.0%; and volatility of 40.0% over the time to a liquidity event for the September 26, 2014 and March 31, 2015 grants, respectively. Estimates of the volatility of the Company’s Class A common stock were based on available information on the volatility of SunEdison and the common stock of comparable publicly traded companies.
The removal of our prior Chief Executive Officer and Chief Financial Officer on November 20, 2015 resulted in the forfeiture of 1,877,915 shares of restricted Class A common stock. The impact of these forfeitures on our stock-based compensation expense for the year ended December 31, 2015 was not material.


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