| Account
Authorization Form (W-9/W-8BEN Form) |
The
UBS Financial Services Inc. Account Authorization form is used to activate
your stock benefit plan account. It includes the required IRS tax identification
information and certificate for U.S. tax withholding on Form W-9 and W-8BEN
to help prevent possible backup withholding and authorizes UBS Financial
Services Inc. to pay your company for the shares you purchase. This form
must be on file in order for you to complete a transaction. |
|
| ACH (Automatic Clearing House) Transfer Proceeds Method |
Allows you to transfer proceeds, resulting from a transaction, to a U.S. financial institution that participates in ACH. The proceeds from your transaction will be transferred to your selected ACH account five business days following your trade date. |
|
| Alternative
Minimum Tax (AMT) |
A
tax calculation that adds certain tax preference items back into adjusted
gross income. If AMT is higher than the regular tax liability for the year,
the regular tax and the amount by which the AMT exceeds the regular tax
are paid.
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|
| Bid
Price |
The
price a buyer is willing to pay for a share of stock at a given time.
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|
| Blackout
Period |
A
period of time when shares of your company stock may not be exercised and/or
sold. Employees should check with their company regarding specific blackout
period information. |
|
| Capital
Gain or Loss |
The
profit or loss from the sale of a capital asset such as a share of stock.
Capital gain may be short-term (one year or less) or long-term (more than
one year). |
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| Cash (RSA/RSU) |
Meet tax liability with personal funds. |
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| Cash
Exercise |
This
exercise method is for participants who want to exercise their vested options,
hold the maximum number of shares and sell them at a later date. Participants
must pay for all option costs and applicable taxes, fees and commissions.
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|
| Commission |
One
of the fees charged by UBS Financial Services Inc. for executing a trade. |
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| Disqualifying
Disposition |
A
sale or disposition of incentive stock option (ISO) shares within two years
from the grant date or one year from the exercise date. The difference between
the grant price and the lesser of the sale price or the fair market value
of the shares at the date of exercise will be taxed as ordinary compensation
income with the excess of any gain over the ordinary income portions taxed
as a long-term or short-term capital gain, depending on the holding period
of the shares.
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|
| Day Limit Order |
This type of order the participant sets the minimum sale price (the "Limit Price") at which the trade is to be executed. If the market moves away from this price, the order will not be executed unless or until the market price returns to the Limit Price. If the order has not been executed by the end of the trading day, it will be automatically cancelled.*
* Please note that Market orders are executed before Limit and GTC orders, while Limit and GTC orders are entered in the order received. |
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| Exercise
|
The
election to purchase the underlying shares under the terms of the option
grant.
|
|
| Exercise
Date |
The
election to purchase the underlying shares under the terms of the option
grant.
|
|
| Exercise
Method |
A
way to exercise your vested stock options (Cashless, Same Day Sale, Sell
to Cover, Stock Swap, Cash Exercise, Sell to Raise Shares and Sell to Raise
Cash. Please see the specific definitions). |
|
| Expiration
Date |
The
expiration date is the last day that a stock option can be exercised or
converted to the underlying security as per the terms of your grant and
may change based on your employment status. If this date falls on a weekend
or holiday, you may be required to exercise your options by the close of
the market on the business day before the expiration date. You should check
your company’s plan documents for more specific information. If the
stock option is not exercised by the expiration date, it is worthless and
is no longer exercisable. |
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| Fair
Market Value (FMV) |
The stock price your Company uses to determine the value of your option upon exercise. For restricted stock awards/units, this is the stock price your Company uses to determine the value of your stock at time of vesting.
Companies may use different methods to determine the fair market value (for example: the average between the high and low stock price for the day, the prior day's closing price, sale price, etc.). You should check your company's plan documents for more specific information. |
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| Good
Till Canceled (GTC) |
This type of order, the participant sets the minimum sale price (the "Limit Price") at which the trade is to be executed. If the market moves away from this price, the order will not be executed unless or until the market price returns to the Limit Price. This type of Limit Order remains in effect until it is executed or cancelled. Depending on your company's arrangement with us, some types of GTC orders to exercise options and sell shares may expire after a fixed number of days, or when your company enters a blackout period, or when your grant status changes.*
* Please note that Market orders are executed before Limit and GTC orders, while Limit and GTC orders are entered in the order received. |
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| Grant
Date |
The date on which your options, restricted stock units or restricted stock awards are awarded to you.
|
|
| Grant
Price (also called the Option or Strike Price) |
The
price you pay for each share under the terms of your stock option grant
when you exercise an option. |
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| "In
the Money" |
The current stock price exceeds the grant price of your stock option. |
|
| Incentive
Stock Options (ISO) |
A
type of employee stock option with a tax benefit, when you exercise, of
not having to pay ordinary income tax. Instead, the options are taxed at
a capital gains rate. |
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| Insider
|
Any
person who may have access to non-public information about a corporation.
|
|
| Intrinsic
Value |
The
difference between the grant price of an "in the money" option and the current
market value of the underlying stock. |
|
| Limit
Order |
This type of order the participant sets the minimum sale price (the "Limit Price") at which the trade is to be executed. If the market moves away from this price, the order will not be executed unless or until the market price returns to the Limit Price. Thus, the participant may not receive an execution of that order.*
* Please note that Market orders are executed before Limit and GTC orders, while Limit and GTC orders are entered in the order received. |
|
| Limit
Price |
The
specific target price or higher at which shares should be sold on a Limit
Order (see Good Till Cancelled/GTC and Limit Order). |
|
| Market
Order |
This type of order is to sell shares as promptly as possible at the prevailing market price. It is not a guarantee of a specific price.*
* Please note that Market orders are executed before Limit and GTC orders, while Limit and GTC orders are entered in the order received. |
|
| Market
Price |
The
last reported price at which a security was sold on an exchange. |
|
| Non-Qualified
Stock Option (NQSO) |
A
type of option that triggers ordinary income tax obligations upon exercise,
regardless of whether or not you sell your shares of stock. This is the
most common type of stock option issued by companies. |
|
| Option
Agreement (also called Award Agreement) |
The
Option Agreement is provided at the time the options are granted and defines
the key terms of your options. Please pay close attention to the terms and
maintain this agreement for future reference. |
|
| Option
Price (also called the Grant or Strike Price) |
The
price you pay for each share under the terms of your stock option grant
when you exercise an option. |
|
| Option
Type |
There
are two primary types of options, Incentive Stock Options (ISO) and Non-Qualified
Stock Options (NQSO). Please see the specific definitions for more information. |
|
| Order
Type |
The
instructions to a brokerage firm for the purchase or sale of a security
with specific conditions. There are four standard order types: Market, Day
Limit, Good Till Cancelled and Stop orders. Market orders are executed first
and Day Limit and Good Till Cancelled orders are entered in the order received. |
|
| Proceeds
|
The
funds generated from the sale of shares. |
|
| Same
Day Sale (also known as Cashless Exercise) |
This
exercise of available options and the sale of all shares resulting from
the option exercise. Proceeds of the sale are used to cover the option cost
and applicable taxes, fees and commissions. Funds remaining are available
to the optionee. |
|
| Sell All |
All shares from vesting will be sold and funds withheld from proceeds to meet tax liability. |
|
| Sell
to Cover |
Meet tax liability by selling shares from vesting. |
|
| Sell
to Raise Cash |
This
exercise method is for participants who want to receive a specific amount
of cash after exercising their available stock options. |
|
| Sell
to Raise Shares |
This
exercise method is for participants who want to receive a specific number
of shares after exercising their available stock options. |
|
| Shares
of Stock |
Shares
of stock represent ownership in a corporation. As a shareholder, you may
be entitled to receive dividends (if declared), vote at shareholder meetings
and sell your shares. |
|
| Shares Vested (RSA/RSU) |
The number of shares which are no longer subject to the restriction period. Once the Fair Market Value (FMV) has been determined, the net shares will be delivered according to the selected Share Delivery Method. |
|
| Spread |
The
difference between the grant price and fair market value of the underlying
shares on the date of exercise. |
|
| Stock
Option |
Your
opportunity (not the obligation) to purchase a set number of shares of stock
at a fixed price for a set period of time. You do not own stock until you
exercise your options. |
|
| Stock
Swap |
This
exercise method is for participants who want to use mature shares (previously
owned) to pay for all exercise costs. |
|
| Stop
Order |
This type of order is electronically held at the order desk and, when a specified price (the "Stop Price") is reached, the order is handled as a Market Order at the price then prevailing. The prevailing market price at the time the order is executed may not be the same as the Stop Price. Thus, for example, in a declining market, a sell Stop Order may be executed at a lower price than the Stop Price. This order is used to protect unrealized profit or to limit loss. Please contact a Representative for assistance in placing a Stop Order. |
|
| Strike
Price (also called the Grant or Option Price) |
The
price you pay for each share under the terms of your stock option grant
when you exercise an option. |
|
| Tax Basis (Award FMV) |
The value used to calculate taxes due. The definition of Fair Market Value (FMV) is determined by your company. For restricted awards this becomes your cost basis for capital gains purposes. |
|
| Tax Payment Method |
The method chosen to meet any tax liabilities (your company's default will be used if no method has been elected). The methods that may be available include: Cash, Withhold, Sell to Cover, Sell, All or Other (processed prior to UBS Financial Services Inc. handling plan). Please see the specific definitions for each. |
|
| Time
Value |
An
option's potential to provide a realizable gain to the optionee over the
remaining term of the option. |
|
| "Under
Water" |
Options
where the grant price is greater than the current market value. |
|
| Vesting
Date |
The date when options from a grant become eligible for exercise. For restricted stock awards/units, this is the date on which awards/units can be sold or transferred under the terms of your company's plan document. Also referred to as Lapse Date. |
|
| Vesting
Period/Schedule |
The
period of time that must pass before you can exercise your options. |
|
| Withhold (RSA) |
Meet tax liability using shares from vesting. |
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