Canceled
When a security's terms and agreements are no longer valid, or when the security has been incorrectly issued (thus granted and canceled on the same day). Option grants are also canceled during repricings and transfers.
Additionally, canceled reflects grants in which no options have vested as of the termination date, and as a result all unvested options return to the pool immediately upon termination.
Example:
Mary had been granted 2 option grants: ES-12 and ES-56 on Feb 2. However, eShares' admin realized that ES-56 is a duplicate issuance. Admin will Cancel ES-56 as of Feb 2 due to clerical error to ensure that the terms/documents set forth are not active/valid. Ideally, company admins identify this error before Mary has a chance to accept ES-56.
Forfeited
Refers to the status on an equity award when there were unvested options at termination, but the holder did not early exercise and as a result the options were given up/returned to the Option Pool as of the termination date.
Or, the status on an equity award that had performance-based vesting where the performance condition was not met so no shares ever vested or became available to exercise – this can happen even if the award has not been terminated.
Example:
Tagg was granted 10,000 options on Jan 1, 2017 with a 1/48th monthly, 1 year cliff. He has been employed with eShares for 2 years before he departs on Jun 12, 2019, thus have vested 2.5 years worth of options (6,041 options). Forfeited: Upon termination date of Jun 12, 2019, 3,959 unvested options (10,000 - 6,041 vested) will return to the Option Pool.
Example for performance-based vesting:
Jordan was granted 5,000 performance options on January 1, 2021, which would vest only if eShares reached $100M in annual recurring revenue (ARR) by December 31, 2024. As of the deadline, eShares had reached $82M ARR, below the required threshold. Forfeited: Because the performance condition was not met by December 31, 2024, all 5,000 options were forfeited and returned to the Option Pool, even though Jordan remains actively employed with eShares.
Expired
Occurs when the remaining vested but unexercised options return to the Option Pool when the exercise expiration date is reached, or when the 10 year grant expiration has passed.
Example:
Tagg has 3 months to exercise the 6,041 vested options (from the example above), but he only exercise 3,000 options before the exercise expiration date. This leaves 3,041 vested options.
Expired: On Sept 12, 2019, the exercise expiration date, since no additional options were exercised, the remaining 3,041 vested, and not exercised options, will return to the Option Pool to be reissued by the company.