New Hampshire Stock Option Plan which provides for grant of Incentive Stock Options and Nonqualified Stock Options to executive officers

• Category: Corporations - Public - Stock Options
• State: Multi-State
• Control #: US-CC-18-210C
• Format: Word; Rich Text

Description

18-210C 18-210C . . . Stock Option Plan which provides for grant of Incentive Stock Options and Non-qualified Stock Options to executive officers of corporation and (b) Non-qualified Stock Options to outside directors on following basis: an initial grant of option to purchase 10,000 shares of the stock plus annual grants of options to purchase 5,000 shares, provided outside director continues to serve as outside director. Each outside director also receives annual option grant of 2,000 shares for each committee on which he or she serves. Outside directors' options are not exercisable during first 12 months of their term. After 12 months they become exercisable as to 24% plus 2% for each complete month of continuous service in excess of 12 months until fully vested. Options may also be granted to executive officers residing in foreign jurisdictions. Board of Directors may adopt such supplements to Plan as may be necessary to comply with applicable laws of such foreign jurisdictions and to afford participants favorable treatment under such laws

The New Hampshire Stock Option Plan is a comprehensive program designed to incentivize executive officers by granting them both Incentive Stock Options (SOS) and Nonqualified Stock Options (Nests). SOS and Nests are two distinct types of stock options that offer various benefits and tax implications for executive officers. Incentive Stock Options (SOS) are a form of stock option that provide certain tax advantages to the recipient. They are typically offered to executives as a long-term incentive, encouraging them to contribute to the company's growth and success. SOS have stringent requirements, such as being granted at fair market value, holding periods before selling, and limitations on the exercise price. These options are usually subject to specific tax rules, allowing the executive officer to potentially realize capital gains tax treatment upon selling the underlying stock. On the other hand, Nonqualified Stock Options (Nests) are more flexible but lack the favorable tax treatment of SOS. Nests are often granted with a lower exercise price than SOS, making them an attractive option for executive officers. However, they are subject to ordinary income tax rates upon exercise, which could result in a higher tax burden for the recipient. Nests can be exercised and sold immediately or held for a longer period before selling. The New Hampshire Stock Option Plan encompasses both SOS and Nests to provide executive officers with a well-rounded compensation package. This plan acknowledges the importance of offering both tax-advantaged SOS and flexible Nests to accommodate varying financial and personal circumstances of executive officers. By implementing the New Hampshire Stock Option Plan, companies can attract and retain top executive talent by providing them with an opportunity to participate in the company's success. The plan not only helps align the interests of executives with shareholders but also enables companies to remain competitive in the market by fostering a motivated and dedicated executive team. Overall, the New Hampshire Stock Option Plan offers a comprehensive framework for granting Incentive Stock Options and Nonqualified Stock Options to executive officers, ensuring that they are appropriately incentivized and rewarded for their contributions to the company's growth.