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Mary Pat Wood, CPA, CEP, Principal


Rick Zatz, CEP, Principal
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x is presentation and t e views expressed by t e individual


presenters s ould not be relied on as legal, accounting,
auditing, or tax advice. x e outcome of any individual
situation depends on t e specific facts and circumstances in
w ic t e issue arises and on t e interpretation of t e
relevant literature in effect at t e time.

Persons viewing t is presentation s ould not act upon t is


information wit out seeking professional counsel and/or
input from t eir advisers.

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r cntroductions
r W o we are
r Our Services
r Section 6039 regulation c anges
r Summary of cRC 6039 requirements
r Facts about cRC 6039
r Draft of Forms 3921 and 3922
r SPS/GZ Solution
r Here¶s ow SPS/GZ is different!

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Rick Zatz (Co-Founder)


Rick is a Certified Equity Professional (CEP) wit 15 years of
experience in stock plan administration. He managed t e stock plan
administration department of a global tec nology company before
founding SPS/GZ. Rick is recognized as a leader in t e industry and
as served on many panels related to best practices in stock plan
administration and curriculum for t e CEP program.

Mary Pat Wood (Co-Founder)


Mary Pat is a Certified Public Accountant (CPA) and a Certified Equity
Professional (CEP) wit 18 years of experience in stock plan
administration, accounting and financial reporting, SEC compliance,
financial forecasting and investor relations. S e was formerly an auditor
for a ³Big Four´ accounting firm and served as External Reporting
Manager at a global software company and at a national mortgage
company
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r A full-service administration outsourcing and consulting firm


r Staffed by seasoned certified professionals (CEPs and CPAs)
r Privately eld company
r Located in C icago
r Founded in 2001
r Mission: xo provide our clients wit expertise and guidance from equity
compensation professionals wit ³      ´ w o could
address t e c anging landscape of accounting regulations and multitude
of complex issues born out of cPOs, mergers, and t e evolving Sarbanes-
Oxley environment.

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r Complete, reliable outsourcing r cRC 6039 mailings and filings
services for equity compensation r Database implementation and
programs (Stock Options, projects
Restricted Stock Awards/Units,
Stock Appreciation Rig ts and r FAS 123(R)/Stock Plan
Employee Stock Purc ase Plans) accounting consulting
r Plan implementation and daily r Customized education
administration presentations to plan participants
r FAS 123(R) valuations and
financial reporting
r SEC, cRS and FASB compliance

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x e cnternal Revenue Service (cRS) as adopted regulations under


Section 6039 of t e cnternal Revenue Code t at, beginning wit
transactions in 2010, companies will be required to provide participants
wit Form 3921 for all cncentive Stock Option (cSO) exercises and Form
3922 upon first transfer of legal title of s ares acquired pursuant to an
Employee Stock Purc ase Plan (ESPP). cn addition, companies also will
be required to file t ese same forms wit t e cRS. For companies filing
more t an 250 forms of eit er Form 3921 or Form 3922, t e cRS
requires t at t ey file t ose forms electronically in t e special file format
specified in cRS Publication 1220.

cnternal Revenue Code 6039 reporting deadlines coincide wit yearly or


quarterly audits/reviews for most companies. Before January creeps up
on you, plan a ead.

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r Requirement is for any corporation t at transfers legal title of stock


pursuant to cSO exercises or ESPP purc ases for plan participants w o
ave earnings and taxes reported to t e cRS.

r For Private Companies, t e 6039 requirement is only triggered if t e


stock is transferred to a brokerage account (not if a stock certificate is
transferred to an employee directly). x us, t is requirement applies
mainly to public companies.

r Forms 3921 (for cSOs) and 3922 (for ESPP) bot require specific data,
suc as t e date t e option was granted, t e date t e option was
exercised, t e exercise price per s are, etc. x us, t ese form must be
filed for EACH cSO exercise or ESPP purc ase t at occurred during t e
calendar year.

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W o s ould file?
Any corporation t at issues stock upon cSO exercises or ESPP
purc ases t roug t e delivery of s ares to a brokerage account.

W at to file?
r Form 3921 for cSO exercises
r Form 3922 for ESPP purc ases

W en to file?
r Beginning in 2011 for transactions from t e previous calendar year
r January 31: Statements to be furnis ed to applicable stock plan
participants
r February 28: Forms to be filed wit cRS (for paper forms)
r Marc 31: Forms to be filed wit cRS (for electronic filers)

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r Draft of Form 3921

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r Draft of Form 3922

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Stock Plan Solutions/Green Zapato as developed an efficient and cost-


effective solution to elp your company complete its 6039 filings &
mailings accurately and on time, and wit out incurring penalties if all
deadlines are met.

r Certified professionals managing t e filings and providing support


r Guidance on data to be extracted from internal systems
r Compilation and formatting of data into one Excel template
r Review for missing data
r Preparation of Forms 3921 & 3922
r Mailing of Forms to employees via U.S.P.S. by January 31st
r Electronic transmission of Forms 3921 & 3922 wit t e cRS
r Confirmation of transmission for all forms
r Arc ive copy of all forms stored on a disc for optimal record-keeping

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       Π        
Software or Platform to Assist wit FcLc G of
Forms 3921 & 3922 Y Y Y
Mailing of forms andled for company
(outsourced) Y Y
Low cost per form for filings and mailings
(wit out utilizing internal staff) Y Y
Savings on time and resources of internal staff ? Y
Compilation and formatting of data exported
from internal systems Y
Fully supported outsourced solution
Y
Entire process managed by certified
professionals (CPAs and CEPs) Y
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Mary Pat Wood, CPA, CEP, Principal


Rick Zatz, CEP, Principal
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x ank you!
Mary Pat Wood, CPA, CEP, Principal
Rick Zatz, CEP, Principal