●
Earnings Feed
Filings
Companies
Insiders
Pricing
Blog
⌘
K
Login
Start Free
$OLMA
·
10-Q
Olema Pharmaceuticals, Inc. · May 12, 7:10 AM ET
Share
Compare
Olema Pharmaceuticals, Inc. 10-Q
Loading document...
Share
More
Contents
22
Basis of Presentation and Consolidation
Unaudited Interim Financial Information
Use of Estimates
Cash and Cash Equivalents
Marketable Securities
Concentration of Credit Risk and Other Risks and Uncertainties
Leases
Research and Development Costs
Research Contract Costs and Accruals
Internal-Use Software
Comprehensive Loss
Stock-Based Compensation
The Company recognizes stock compensation in accordance with Accounting Standards Codification ("ASC") 718, Compensation — Stock Compensation (“ASC 718”). Stock-based compensation cost, including grants of stock options and restricted stock units issued under the Company’s equity incentive plans, and the 2020 Employee Stock Purchase Plan (the "ESPP"), is measured at the grant date based on the estimated fair value of the award and is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period.
The Company estimates the fair value of stock options with time-based vesting on the date of grant utilizing the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including (i) the expected volatility of its stock, (ii) the expected term of the award, (iii) the risk-free interest rate, and (iv) expected dividends. The Company estimates the volatility of its stock based on a weighted average of the volatility of the Company's stock price and that of its peers. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. The Company uses the simplified method to estimate the expected term of employee stock option grants, whereby the expected term is estimated to be the mid-point between the vesting date and the contractual term of the option. The risk-free rates for period within the expected term of the option are based on the U.S. Treasury yield curve during the period the options were granted. The expected dividend yield of zero is based on the fact that the Company has never paid dividends and does not expect to pay any cash dividends in the foreseeable future. For awards with graded vesting, in which specified tranches of the options vest on different dates, the Company uses a single weighted average expected life to value the entire award, which is equal to the average of the weighted average vesting period of the award and the contractual term of the award. The amount of stock-based compensation expense recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest, including awards with graded vesting. As part of the requirements of ASC 718, the Company has elected to account for forfeitures of stock option grants as they occur.
The Company measures the fair value of restricted stock units ("RSU"s) based on the closing price of the Company's common stock on the grant date. Stock-based compensation expense for RSUs is recognized on a straight-line basis over the vesting term.
Equity Awards with Market and Service Conditions
The fair value and derived service period of performance-based awards granted with market and service conditions are estimated on the grant date using a Monte Carlo simulation model. A Monte Carlo simulation model requires inputs such as the risk-free interest rate, expected award term, expected share dilution and expected share price volatility. These inputs, which are subjective and generally require significant judgment, are unique to each award based on the best available information at the grant date. For such awards, stock-based compensation expense is recognized on a straight-line basis over the derived service period of each tranche. Stock-based compensation expense will continue to be recognized over the derived service period regardless of whether the awards' market-based vesting terms have been satisfied, so long as the requisite service is rendered by the grantee.
Foreign Currency Transactions
Pre-funded Warrants
Net Loss Per Common Share
Segment Reporting
Recent Accounting Pronouncements Adopted
Contents
Share
More
Download PDF