Share-Based Compensation

3 Months Ended

Jun. 30, 2023

Note 8—Share-Based Compensation

(A) RSL Equity Incentive Plans

RSL has three equity incentive plans: the Roivant Sciences Ltd. 2021 Equity Incentive Plan (the “RSL 2021 EIP”), the Roivant Sciences Ltd. Amended and Restated 2015 Equity Incentive Plan, and the Roivant Sciences Ltd. Amended and Restated 2015 Restricted Stock Unit Plan (collectively, the “RSL Equity Plans”). The RSL 2021 EIP was approved and adopted in connection with the Business Combination and became effective immediately prior to closing. At June 30, 2023, a total of 41,793,359 common shares were available for future grants under the RSL 2021 EIP.

Stock Options and Performance Stock Options

Activity for stock options and performance stock options under the RSL Equity Plans for the three months ended June 30, 2023 was as follows:

	Number of Options
Options outstanding at March 31, 2023		154,271,791
Granted		4,351,602
Exercised		(4,965,387	)
Forfeited/Canceled		(606,221	)
Options outstanding at June 30, 2023		153,051,785
Options exercisable at June 30, 2023		84,263,636

Restricted Stock Units and Performance Stock Units

Activity for restricted stock units and performance stock units under the RSL Equity Plans for the three months ended June 30, 2023 was as follows:

	Number of Shares
Non-vested balance at March 31, 2023		20,700,788
Granted		3,628,644
Vested		(2,372,501	)
Forfeited		(537,674	)
Non-vested balance at June 30, 2023		21,419,257

Capped Value Appreciation Rights

March 2020 CVAR Grants

As of June 30, 2023, there are 1,176,198 non-service-vested capped value appreciation rights (“CVARs”) and 29,084,574 service-vested CVARs relating to the March 2020 grants. During the three months ended June 30, 2023, 1,711,450 service-vested CVARs subject to the knock-in condition satisfied both the applicable hurdle price and the knock-in condition on the applicable measurement date, and as a result, 534,942 common shares were issued upon their settlement.

November 2021 CVAR Grants

Activity for CVARs under the RSL 2021 EIP for the three months ended June 30, 2023 is as follows:

	Number of CVARs
Non-vested balance at March 31, 2023		3,222,645
Vested		(325,655	)
Forfeited		(32,413	)
Non-vested balance at June 30, 2023		2,864,577

During the three months ended June 30, 2023, 325,655 common shares were issued upon their settlement.

(B) Subsidiary Equity Incentive Plans

Certain subsidiaries of RSL adopt their own equity incentive plan (“EIP”). Each EIP is generally structured so that the applicable subsidiary, and its affiliates’ employees, directors, officers and consultants are eligible to receive non-qualified and incentive stock options, stock appreciation rights, restricted share awards, restricted stock unit awards, and other share awards under their respective EIP. The Company recorded share-based compensation expense of $14.9 million and $11.5 million for the three months ended June 30, 2023 and 2022, respectively, related to subsidiary EIPs.