SHARE BASED COMPENSATION

6 Months Ended

Jun. 30, 2021

7.	SHARE BASED COMPENSATION

The Company amended its 2009 share incentive plan (the “Plan”) in July 2019. Under the Plan, the Company may grant options, restricted share award (“RSA”), restricted share unit (“RSU”) or share appreciation right (“SAR”) to its officers, employees, directors and other eligible persons (collectively known as “Eligible Persons”) of up to 83,000,000 Class A ordinary shares. The Plan is administered by an authorized administrator appointed by the Board of Directors of the Company set forth in the Plan (the “Plan Administrator”).

The maximum number of shares which may be issued pursuant to all awards under the Plan will increase on January 1 of each of 2019, 2020, 2021 and 2022 by 5% of the total number of ordinary shares of all classes of the Company outstanding on that day immediately before such annual increase pursuant to the Plan. With effect on January 1, 2019, July 25, 2019, January 1, 2020 and January 1, 2021, the maximum number of shares which may be issued pursuant to all awards under the Plan increased to 100,129,938, 103,129,938, 123,292,170 and 148,888,743 Class A ordinary shares.

During the six months ended June 30, 2020 and 2021, the Company granted 5,806,825 options, 4,010,828 RSUs and 78,595 SARs, and 4,162,121 options, 2,220,693 RSUs and 32,635 SARS to the Eligible Persons. All options granted have a contractual term of ten years. The options vest according to the stated vesting period in the grantee’s option agreement. The RSUs and SARs generally vest 25% on the first anniversary year from the stated vesting commencement date and the remaining 75% will vest in 12 substantially equal quarterly instalments.

The Company calculated the estimated fair value of the options on the respective grant dates using the Black-Scholes option pricing model with the following assumptions.

	Granted in 2021

Risk-free interest rates		0.74%~1.07%
Expected term	5.6~7.5 years
Expected volatility		32.1%~33.0%
Expected dividend yield		–
Fair value of share options		$71.70~$84.14

Total compensation expense relating to options, RSAs, RSUs and SARs granted to Eligible Persons after deducting forfeitures recognized for the six months ended June 30, 2020 and 2021, respectively, is as follows:

	For the Six Months ended June 30,
	2020		2021
	$_		$_

Share options:
Cost of revenue		65		247
Sales and marketing expenses		31		5
General and administrative expenses		74,363		109,351
Research and development expenses		213		33

		74,672		109,636

RSAs and RSUs:
Cost of revenue		1,993		3,845
Sales and marketing expenses		4,306		9,562
General and administrative expenses		14,299		27,697
Research and development expenses		17,824		52,950

		38,422		94,054

SARs:
Cost of revenue		980		2,471
Sales and marketing expenses		1,898		4,707
General and administrative expenses		1,078		3,029
Research and development expenses		136		663

		4,092		10,870

Total		117,186		214,560