Symantec 2013 Annual Report Download - page 41

Non-Employee Director Equity Awards. Under the 2013 Plan, non-employee directors may be granted
stock options and other awards either on a discretionary basis or pursuant to policy adopted by the Board, except
that no non-employee director will be eligible to receive more than 2,000,000 shares in any one fiscal year. Pur-
suant to a policy adopted by the Board, each non-employee member of the Board receives an annual award of
fully-vested restricted stock units having a fair market value on the grant date equal to $235,000, with this value
prorated for new non-employee directors from the date of such director’s appointment to the Board to the end of
the fiscal year.
Corporate Transaction. In the event of a change of control of Symantec (as set forth in the 2013 Plan), the
buyer may either assume outstanding awards or substitute equivalent awards. If the buyer fails to assume or sub-
stitute awards issued under the 2013 Plan, all awards will expire upon the closing of the transaction, and the
Board will determine whether the change of control will have any additional effect, including acceleration of the
vesting of the awards. Unless otherwise determined by the Board, all unvested stock option and RSU awards
made to non-employee directors under the 2013 Plan will accelerate and vest in full. A change of control of
Symantec must also qualify as a change in control within the meaning of Section 409(A) of Code and the regu-
lations thereunder.
Amendment or Termination of 2013 Plan. The Board may at any time amend or terminate the 2013 Plan in
any respect; provided, that the Board may not, without the approval of the stockholders of Symantec, amend the
2013 Plan to increase the number of shares that may be issued under the 2013 Plan, change the designation of
employees or class of employees eligible for participation in the 2013 Plan or materially modify a provision of
the 2013 Plan if the modification requires stockholder approval under rules of the NASDAQ Stock Market.
Termination Date. The 2013 Plan will terminate on October 22, 2023 unless terminated earlier.
Summary of Federal Income Tax Consequences of Awards Granted under the 2013 Equity Incentive Plan
The following is a general summary as of the date of this proxy statement of the U.S. federal income tax
consequences to Symantec and participants in the 2013 Plan with respect to awards granted under the 2013 Plan.
U.S. federal tax laws may change and U.S. federal, state and local tax consequences for any participant will
depend upon his or her individual circumstances.
Tax Treatment of the Participant
Incentive Stock Options. An optionee will recognize no income upon the grant of an incentive stock option
(“ISO”) and will incur no tax upon exercise of an ISO unless for the year of exercise the optionee is subject to the
alternative minimum tax (“AMT”). If the optionee holds the shares purchased upon exercise of the ISO (the “ISO
Shares”) for more than one year after the date the ISO was exercised and for more than two years after the ISO’s
grant date (the “required holding period”), then the optionee generally will realize long-term capital gain or loss
(rather than ordinary income or loss) upon disposition of the ISO Shares. This gain or loss will equal the differ-
ence between the amount realized upon such disposition and the amount paid for the ISO Shares upon the
exercise of the ISO.
If the optionee disposes of ISO Shares prior to the expiration of the required holding period (a
“disqualifying disposition”), then gain realized upon such disposition, up to the difference between the option
exercise price and the fair market value of the ISO Shares on the date of exercise (or, if less, the amount realized
on a sale of such ISO Shares), will be treated as ordinary income. Any additional gain will be capital gain, and
treated as long-term capital gain or short-term capital gain depending upon the amount of time the ISO Shares
were held by the optionee.
Alternative Minimum Tax. The difference between the exercise price and fair market value of the ISO
Shares on the date of exercise is an adjustment to income for purposes of the AMT. Alternative minimum taxable
income is determined by adjusting regular taxable income for certain items, increasing that income by certain tax
preference items and reducing this amount by the applicable exemption amount. If a disqualifying disposition of
the ISO Shares occurs in the same calendar year as exercise of the ISO, there is no AMT adjustment with respect
to those ISO Shares. Also, upon a sale of ISO Shares that is not a disqualifying disposition, alternative minimum
taxable income is reduced in the year of sale by the excess of the fair market value of the ISO Shares at exercise
over the amount paid for the ISO Shares.
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