This excerpt taken from the ISIL DEF 14A filed Aug 20, 2009.
Stock Appreciation Rights
A participant will recognize no taxable income, and the Company or a subsidiary or affiliate, as applicable, is not entitled to a deduction, when a stock appreciation right is granted. Upon exercise or settlement of a stock appreciation right, a participant will recognize compensation taxable as ordinary income in an amount equal to the cash or the fair market value of the shares received and, subject to Section 162(m) of the Code, the Company or a subsidiary or affiliate, as applicable, will be entitled to a corresponding deduction. A participants tax basis in shares of Common Stock received upon the exercise of a stock appreciation right will be equal to the fair market value of such shares on the exercise date, and the participants holding period for such shares will begin at that time. Upon the sale of shares of Common Stock received in exercise of a stock appreciation right, the participant will recognize short-term or long-term capital gain or loss, depending on whether the shares have been held for more than one year. The amount of such gain or loss will be equal to the difference between the amount realized in connection with the sale of the shares and the participants tax basis in such shares.