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SHARE-BASED COMPENSATION
 12 Months Ended
Dec. 31, 2016
SHARE-BASED COMPENSATION  
SHARE-BASED COMPENSATION

 

10.     SHARE-BASED COMPENSATION

 

Share incentive plan

 

In September 2015, the Company adopted the 2015 Share Incentive Plan (the “2015 Plan”), which permits the grant of three types of awards: options, restricted shares and restricted share units.  Persons eligible to participate in the 2015 Plan includes employees, directors and consultants of the company or any of affiliates, which include the Company’s parent company, subsidiaries and any entities in which the parent company or a subsidiary of the Company holds a substantial ownership interest. Under the 2015 plan, the maximum of 10,000,000 ordinary shares were reserved for issuance.

 

On July 1, 2016, the Company approved a grant of 4,034,100 restricted share units to directors and employees of the Group and CreditEase and its consolidated subsidiaries and VIEs under the 2015 Plan. Approximately 59.9% of the share awards were immediately vested and the rest is expected to be vested in various days up to four years. The grant date fair value of the awards was US$7.25 per ordinary share, which was determined based on the closing price of the Company’s ADSs on NYSE on July 1, 2016.

 

524,000 restricted share units were granted to directors and employees of the Group. The awards granted to the employees of the Group are recognized as share-based compensation expense and measured based on the fair value as of the grant date. The Company recognized compensation expenses in general and administrative expense of nil, nil and RMB17,223 for the years ended December 31, 2014, 2015 and 2016.

 

3,510,100 restricted share units were granted to employees of CreditEase and its consolidated subsidiaries and VIEs. The awards granted to employees of CreditEase and its subsidiaries were deemed dividend from the Company to Parent as the employees of CreditEase do not provide service directly related to the Company. The awards are measured based on the fair value as of the grant date. The amount recognized as deemed dividend were nil, nil and RMB124,210 for the years ended December 31, 2014, 2015 and 2016 respectively.

 

Restricted Share Units

 

The following table sets forth a summary of restricted share units activities:

 

 

 

Number of Restricted Shares

 

Weighted-Average
Grant-Date
Fair Value

 

 

 

 

 

US$

 

Outstanding at January 1, 2016

 

—

 

—

 

Granted

 
4,034,100

 
7.25

 

Vested

 
(2,512,300

)
7.25

 

Forfeited

 
(74,600

) 
7.25

 

 

 

 

 

 

 

Outstanding at December 31, 2016

 
1,447,200

 
7.25

 

 

 

 

 

 

 

 

As of December 31, 2016, unrecognized compensation cost related to unvested awards granted to employees of the Group, adjusted for estimated forfeitures, was RMB8,384. This cost is expected to be recognized over 3.5 years on an accelerated basis.

 

As of December 31, 2016, unrecognized deemed dividend related to unvested awards granted to employees of CreditEase and its consolidated subsidiaries and VIEs, adjusted for estimated forfeitures, was RMB43,095. Such deemed dividend will be recorded over 3.5 years on an accelerated basis.