Staples 2013 Annual Report Download - page 38

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Provisions for Foreign Participants
The Board of Directors may establish subplans or procedures under the 2014 Plan to recognize differences in laws, rules,
regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters.
Amendment or Termination
No Award may be made under the 2014 Plan after the tenth anniversary of stockholder approval of the 2014 Plan but
Awards previously granted may extend beyond that date. The Board of Directors may at any time amend, suspend or terminate
the 2014 Plan, provided that no amendment requiring stockholder approval under any applicable legal, regulatory or listing
requirement will become effective until such stockholder approval is obtained. No Award will be made that is conditioned upon
stockholder approval of any amendment to the 2014 Plan unless the Award provides that (1) it will terminate or be forfeited if
stockholder approval of such amendment is not obtained within no more than 12 months from the date of grant and (2) it may not
be exercised or settled (or otherwise result in the issuance of Common Stock) prior to such stockholder approval.
If our stockholders do not approve the adoption of the 2014 Plan, the 2014 Plan will not go into effect, and we will not
grant any Awards under the 2014 Plan. In such event, the Board of Directors will consider whether to adopt alternative arrangements
based on its assessment of the needs of our company.
Federal Income Tax Consequences
The following is a summary of the United States federal income tax consequences that generally will arise with respect
to Awards granted under the 2014 Plan. This summary is based on the federal tax laws in effect as of the date of this proxy
statement. In addition, this summary assumes that all Awards are exempt from, or comply with, the rules under Section 409A of
the Code regarding nonqualified deferred compensation. Changes to these laws could alter the tax consequences described below.
Incentive Stock Options
A participant will not have income upon the grant of an incentive stock option. Also, except as described below, a
participant will not have income upon exercise of an incentive stock option if the participant has been employed by the Company
or its corporate parent or 50% or more-owned corporate subsidiary at all times beginning with the option grant date and ending
three months before the date the participant exercises the option. If the participant has not been so employed during that time,
then the participant will be taxed as described below under “Non-statutory Stock Options.” The exercise of an incentive stock
option may subject the participant to the alternative minimum tax.
A participant will have income upon the sale of the stock acquired under an incentive stock option at a profit (if sales
proceeds exceed the exercise price). The type of income will depend on when the participant sells the stock. If a participant sells
the stock more than two years after the option was granted and more than one year after the option was exercised, then all of the
profit will be long-term capital gain. If a participant sells the stock prior to satisfying these waiting periods, then the participant
will have engaged in a disqualifying disposition and a portion of the profit will be ordinary income and a portion may be capital
gain. This capital gain will be long-term if the participant has held the stock for more than one year and otherwise will be short-
term. If a participant sells the stock at a loss (sales proceeds are less than the exercise price), then the loss will be a capital loss.
This capital loss will be long-term if the participant held the stock for more than one year and otherwise will be short-term.
Non-statutory Stock Options
A participant will not have income upon the grant of a non-statutory stock option. A participant will have compensation
income upon the exercise of a non-statutory stock option equal to the value of the stock on the day the participant exercised the
option less the exercise price. Upon sale of the stock, the participant will have capital gain or loss equal to the difference between
the sales proceeds and the value of the stock on the day the option was exercised. This capital gain or loss will be long-term if
the participant has held the stock for more than one year and otherwise will be short-term.
Stock Appreciation Rights
A participant will not have income upon the grant of a stock appreciation right. A participant generally will recognize
compensation income upon the exercise of an SAR equal to the amount of the cash and the fair market value of any stock received.
Upon the sale of the stock, the participant will have capital gain or loss equal to the difference between the sales proceeds and the