Tax Consequences Clause Example with 40 Variations from Business Contracts
This page contains Tax Consequences clauses in business contracts and legal agreements. An example clause is provided at the top of the page, followed by clauses with minor variations. You can view the text differences by selecting the "Show Differences" option.
Tax Consequences. Set forth below is a brief summary, as of the Date of Grant, of some of the federal tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) Exercise of Incentive Stock Option. If the Option qualifies as an Incentive Stock Option, there will be no regular federal income tax liability... upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to alternative minimum taxable income for federal income tax purposes and may subject the Optionee to an alternative minimum tax liability in the year of exercise. (b) Exercise of Non-Qualified Stock Option. If the Option does not qualify as an Incentive Stock Option, there may be a regular federal income tax liability upon the exercise of the Option. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee is an Employee or former Employee, the Company will be required to withhold from the Optionee's compensation or collect from the Optionee and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) Disposition of Shares. In the case of a Non-Qualified Stock Option, if the Shares are held for at least one year before disposition, any gain on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal income tax purposes. If the Shares acquired pursuant to an Incentive Stock Option are disposed of within such one-year or two-year periods (a "disqualifying disposition"), gain on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, the difference between the amount realized on the sale of such Shares and the Exercise Price. Any gain in excess of the Spread shall be treated as capital gain.View More
Variations of a "Tax Consequences" Clause from Business Contracts
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 10.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incen...tive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if 20 any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 10.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) 10.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares. (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Vested Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, Price. To the extent the Shares were exercised prior to vesting coincident with the filing of an 83(b) Election, the amount taxed because of a disqualifying disposition will be based upon the excess, if less, any, of the fair market value on the date of vesting over the exercise price. (b) Nonqualified Stock Options. If the Shares are held for more than twelve (12) months after the date of the transfer of the Shares pursuant to the exercise of an NQSO, any gain realized on disposition of the Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. 10.4. Section 83(b) Election for Unvested Shares. With respect to Unvested Shares, which are subject to the Repurchase Option, unless an election is filed by the Participant with the Internal Revenue Service (and, if necessary, the proper state taxing authorities), within 30 days of the purchase of the Unvested Shares, electing pursuant to Section 83(b) of the Code (and similar state tax provisions, if applicable) to be taxed currently on any difference between the amount realized Exercise Price of the Unvested Shares and their Fair Market Value on the sale date of such purchase, there may be a recognition of taxable income (including, where applicable, alternative minimum taxable income) to the Participant, measured by the excess, if any, of the Fair Market Value of the Unvested Shares and at the time they cease to be Unvested Shares, over the Exercise Price. Any gain in excess Price of the Spread Unvested Shares. 21 11. Privileges of Stock Ownership. Participant shall be treated as capital gain. not have any of the rights of a shareholder with respect to any Shares until the Shares are issued to Participant. View More
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 10.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incen...tive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 10.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) 5 10.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares. (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Vested Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, Price. To the extent the Shares were exercised prior to vesting coincident with the filing of an 83(b) Election, the amount taxed because of a disqualifying disposition will be based upon the excess, if less, any, of the fair market value on the date of vesting over the exercise price. (b) Nonqualified Stock Options. If the Shares are held for more than twelve (12) months after the date of the transfer of the Shares pursuant to the exercise of an NQSO, any gain realized on disposition of the Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. 10.4. Section 83(b) Election for Unvested Shares. With respect to Unvested Shares, which are subject to the Repurchase Option, unless an election is filed by the Participant with the Internal Revenue Service (and, if necessary, the proper state taxing authorities), within 30 days of the purchase of the Unvested Shares, electing pursuant to Section 83(b) of the Code (and similar state tax provisions, if applicable) to be taxed currently on any difference between the amount realized Exercise Price of the Unvested Shares and their Fair Market Value on the sale date of such purchase, there may be a recognition of taxable income (including, where applicable, alternative minimum taxable income) to the Participant, measured by the excess, if any, of the Fair Market Value of the Unvested Shares and at the time they cease to be Unvested Shares, over the Exercise Price. Any gain in excess Price of the Spread shall be treated as capital gain. Unvested Shares. View More
Tax Consequences. Set forth below is a brief summary, as summary of the Date of Grant, of some of the certain United States federal tax consequences of exercise of the Option and disposition of the Shares under the laws in effect as of the Grant Date. This summary does not address specific state, local, or foreign tax consequences that may be applicable to Participant. Participant is responsible for consulting a tax adviser as to the applicable tax laws of the jurisdiction(s) in which Participant resides or may b...e subject to tax before exercising the Option or disposing of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) Participant understands that this summary is necessarily incomplete, and the tax laws and regulations are subject to change. a. Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incentive Stock Option, ISO, there will be no regular federal income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Option Price will be treated as an adjustment to the alternative minimum taxable income tax for federal income tax purposes and may subject Participant to the Optionee to an alternative minimum tax liability in the year of exercise. (b) b. Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Option Price. If the Optionee Participant is an Employee employee or former Employee, employee of the Company, the Company will be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) c. Disposition of Shares. In the case of a Non-Qualified Nonqualified Stock Option, if the Shares are held for at least more than one year before disposition, after the date of exercise, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, ISO, if Shares transferred pursuant to the Option are held for at least more than one year after the date of exercise and at least are disposed of more than two years after the Date of Grant, Grant Date, any gain realized on disposition on of the Shares will also be treated as long-term 5 capital gain for federal Stock Option Agreement 4 income tax purposes. If the Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year or two-year periods (a "disqualifying disposition"), gain on such disqualifying disposition before the end of either of the two holding periods, Participant will be treated as compensation income (taxable at recognize ordinary income rates) at the time of the disposition in an amount equal to the extent of the excess, if any, of excess of: (i) the Fair Market Value of the Shares on the exercise date, over (ii) the lower of the Option Price and the sale price. Any additional gain recognized upon the disqualifying disposition will be capital gain, which will be long-term if the Shares have been held for more than one year following the exercise date of exercise over the Exercise Price (the "Spread"), or, Option. d. Notice of Disqualifying Disposition of ISO Shares. If the Option granted to the Participant herein is an ISO, and if less, Participant sells or otherwise disposes of any of the difference between Shares acquired pursuant to the amount realized ISO on or before the later of: (i) the date two years after the Grant Date, or (ii) the date one year after the date of exercise, Participant shall immediately notify the Company in writing of such disposition. Participant agrees that Participant may be subject to income tax withholding by the Company on the sale compensation income recognized by Participant from the early disposition by payment in cash or out of such Shares and the Exercise Price. Any gain in excess of the Spread shall be treated as capital gain. current earnings paid to Participant. View More
Tax Consequences. Set forth below is a brief summary, as summary of the Date of Grant, of some of the certain United States federal tax consequences of exercise of the Option and disposition of the Shares under the laws in effect as of the Grant Date. This summary does not address specific state, local, or foreign tax consequences that may be applicable to Participant. Participant is responsible for consulting a tax adviser as to the applicable tax laws of the jurisdiction(s) in which Participant resides or may b...e subject to tax before exercising the Option or disposing of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) Participant understands that this summary is necessarily incomplete, and the tax laws and regulations are subject to change. a. Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incentive Stock Option, ISO, there will be no regular federal income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Option Price will be treated as an adjustment to the alternative minimum taxable income tax for federal income tax purposes and may subject Participant to the Optionee to an alternative minimum tax liability in the year of exercise. (b) b. Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Option Price. If the Optionee Participant is an Employee employee or former Employee, employee of the Company, the Company will be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) Stock Option Agreement 4 c. Disposition of Shares. In the case of a Non-Qualified Nonqualified Stock Option, if the Shares are held for at least more than one year before disposition, after the date of exercise, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, ISO, if Shares transferred pursuant to the Option are held for at least more than one year after the date of exercise and at least are disposed of more than two years after the Date of Grant, Grant Date, any gain realized on disposition on of the Shares will also be treated as long-term 5 capital gain for federal income tax purposes. If the Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year or two-year periods (a "disqualifying disposition"), gain on such disqualifying disposition before the end of either of the two holding periods, Participant will be treated as compensation income (taxable at recognize ordinary income rates) at the time of the disposition in an amount equal to the extent of the excess, if any, of excess of: (i) the Fair Market Value of the Shares on the exercise date, over (ii) the lower of the Option Price and the sale price. Any additional gain recognized upon the disqualifying disposition will be capital gain, which will be long-term if the Shares have been held for more than one year following the exercise date of exercise over the Exercise Price (the "Spread"), or, Option. d. Notice of Disqualifying Disposition of ISO Shares. If the Option granted to the Participant herein is an ISO, and if less, Participant sells or otherwise disposes of any of the difference between Shares acquired pursuant to the amount realized ISO on or before the later of: (i) the date two years after the Grant Date, or (ii) the date one year after the date of exercise, Participant shall immediately notify the Company in writing of such disposition. Participant agrees that Participant may be subject to income tax withholding by the Company on the sale compensation income recognized by Participant from the early disposition by payment in cash or out of such Shares and the Exercise Price. Any gain in excess of the Spread shall be treated as capital gain. current earnings paid to Participant. View More
Tax Consequences. Set forth below is a brief summary, as of the Date of Grant, of some Some of the federal tax consequences of exercise relating to this Option, as of the Option and disposition date of the Shares. this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE THIS OPTION OR DISPOSING OF THE SHARES. (a) Exercise of Incentive Stock Exercising the Option. If the ...Option qualifies as an Incentive Stock Option, there will be no The Optionee may incur regular federal income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to alternative minimum taxable income for federal income tax purposes and may subject the Optionee to an alternative minimum tax liability in the year of exercise. (b) Exercise of Non-Qualified a Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, there may be a regular federal income tax liability upon the exercise of the Option. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value fair market value of the Shares exercised shares on the date of exercise over the their aggregate Exercise Price. If the Optionee is an Employee or a former Employee, the Company will be required to withhold from the Optionee's his or her compensation or collect from the Optionee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. (c) (b) Disposition of Shares. In If the case of a Non-Qualified Stock Option, if the Optionee holds NSO Shares are held for at least one year before disposition, year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal income tax purposes. If the Shares acquired pursuant to an Incentive Stock Option are disposed of within such one-year or two-year periods (a "disqualifying disposition"), gain on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, the difference between the amount realized on the sale of such Shares and the Exercise Price. Any gain in excess of the Spread shall be treated as capital gain.View More
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 9.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incent...ive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 9.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee will Participant shall be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) -5- 9.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares: (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, Price. (b) Nonqualified Stock Options. If the difference between Shares are held for more than twelve (12) months after the amount date of purchase of the Shares pursuant to the exercise of an NQSO, any gain realized on the sale of such Shares and the Exercise Price. Any gain in excess disposition of the Spread shall Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. View More
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 10.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incen...tive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 10.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) 10.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares. (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Vested Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, Price. (b) Nonqualified Stock Options. If the difference between Shares are held for more than twelve (12) months after the amount date of purchase of the Shares pursuant to the exercise of an NQSO, any gain realized on the sale of such Shares and the Exercise Price. Any gain in excess disposition of the Spread shall Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. View More
Tax Consequences. Set forth below is a brief summary, summary as of the Date date of Grant, this Option Agreement of some of the federal tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE GRANTEE SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) Exercise of Incentive Stock Option. If the Option qualifies as an Incentive Stock Option, th...ere will be no regular federal income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to alternative minimum taxable income for federal income tax purposes and may subject the Optionee to an alternative minimum tax liability in the year of exercise. (b) Exercise of Non-Qualified Stock Option. If the Option does not qualify as an Incentive On exercise of a Non-Qualified Stock Option, there may be a regular federal income tax liability upon the exercise of the Option. The Optionee Grantee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Grantee is an Employee or a former Employee, the Company will be required to withhold from the Optionee's Grantee's compensation or collect from the Optionee Grantee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. (c) (b) Disposition of Shares. In the case of a Non-Qualified Stock Option, if the Shares are held for at least more than one year before disposition, year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal income tax purposes. If the Shares acquired pursuant to an Incentive Stock Option are disposed of within such one-year or two-year periods (a "disqualifying disposition"), gain on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, the difference between the amount realized on the sale of such Shares and the Exercise Price. Any gain in excess of the Spread shall be treated as capital gain.View More
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 9.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incent...ive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 9.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be 4 required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) 9.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares. (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Vested Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, Price. To the difference between extent the Shares were exercised prior to vesting coincident with the filing of an 83(b) Election, the amount taxed because of a disqualifying disposition will be based upon the excess, if any, of the fair market value on the date of vesting over the exercise price. (b) Nonqualified Stock Options. If the Shares are held for more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an NQSO, any gain realized on the sale of such Shares and the Exercise Price. Any gain in excess disposition of the Spread shall Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. View More
Tax Consequences. Set forth below is a brief summary, summary as of the Effective Date of Grant, the Plan of some of the federal and California tax consequences of exercise of the Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE PARTICIPANT SHOULD CONSULT A TAX ADVISOR ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES. (a) 9.1 Exercise of Incentive Stock Option. ISO. If the Option qualifies as an Incent...ive Stock Option, ISO, there will be no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to a tax preference item for federal alternative minimum taxable income for federal income tax purposes and may subject the Optionee Participant to an the alternative minimum tax liability in the year of exercise. (b) 9.2 Exercise of Non-Qualified Nonqualified Stock Option. If the Option does not qualify as an Incentive Stock Option, ISO, there may be a regular federal and California income tax liability upon the exercise of the Option. The Optionee Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If the Optionee Participant is an Employee a current or former Employee, employee of the Company, the Company will may be required to withhold from the Optionee's Participant's compensation or collect from the Optionee Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. (c) 9.3 Disposition of Shares. In The following tax consequences may apply upon disposition of the case of a Non-Qualified Shares. (a) Incentive Stock Option, if Options. If the Shares are held for at least one year before disposition, more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed of more than two (2) years after the Date of Grant, any gain realized on disposition of the Shares will be treated as long-term long term capital gain for federal income tax purposes. In the case of an Incentive Stock Option, if Shares are held for at least one year after the date of exercise and at least two years after the Date of Grant, any gain on disposition on the Shares will be treated as long-term 5 capital gain for federal California income tax purposes. If the Vested Shares acquired pursuant to purchased under an Incentive Stock Option ISO are disposed of within such one-year the applicable one (1) year or two-year periods (a "disqualifying disposition"), two (2) year period, any gain realized on such disqualifying disposition will be treated as compensation income (taxable at ordinary income rates) rates in the year of the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price (the "Spread"), or, if less, Price. To the difference between extent the Shares were exercised prior to vesting coincident with the filing of an 83(b) Election, the amount taxed because of a disqualifying disposition will be based upon the excess, if any, of the fair market value on the date of vesting over the exercise price. (b) Nonqualified Stock Options. If the Shares are held for more than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an NQSO, any gain realized on the sale of such Shares and the Exercise Price. Any gain in excess disposition of the Spread shall Shares will be treated as long term capital gain. (c) Withholding. The Company may be required to withhold from the Participant's compensation or collect from the Participant and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income. View More
