This excerpt taken from the NDAQ 10-Q filed Aug 8, 2008.
RSAs
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RSA Vesting
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RSAs will vest 100% two (2) years from the date of grant. RSAs will also vest upon the scheduled expiration of a Director’s term, if such term is not
renewed.
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Upon a Director’s resignation (other than for death or disability) prior to the end of the Director’s term, RSAs will be forfeited.
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Upon termination of a Director for “Misconduct” all RSAs will be forfeited without further consideration to the Director.
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Upon termination of a Director on account of his death or “Disability,” RSAs will vest.
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Shortly after vesting, your vested shares will appear in your account at E*trade. You may view your information by logging directly onto your online E*Trade account
at https://us.etrade.com/e/t/user/login_sp. Additionally, you may contact E*Trade’s Executive Services Team at 1.866.987.2339 or via email at executive services@etrade.com
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RSA Agreements, Share Restrictions & Voting Rights
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RSAs will be evidenced by an RSA Agreement to be entered into with each Director and will be governed by the Equity Incentive Plan.
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Once vested, shares will be freely tradable. NASDAQ OMX does not have a repurchase right or obligation.
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As all the private company restrictions on NASDAQ OMX common stock sold in the private placement expired on June 28, 2002, these shares will be freely
transferable upon vesting. Trading in these shares, however, will be subject to the Policy Statement On Trading
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In NASDAQ OMX and Other Securities By Directors and Officers and to any contractual restrictions on transfer, such as lock-up agreements, that may be
applicable
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During the vesting period, unvested restricted shares may be voted.
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Taxes
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Taxes on restricted stock are generally not imposed at the time of grant. However, once shares vest, the values of the vested shares are taxed as ordinary income.
Alternatively, a Section 83(b) election may be filed with the IRS within 30 days of the date of grant. An 83(b) election, allows for the taxes to be paid on the value of the unvested RSA on the date of grant, instead of at the time of
vesting.
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If an 83(b) election is not made, tax will be due on the value of the vested portion of the RSA on the date of vesting using NASDAQ OMX’s “Fair
Market Value.” The payment of these taxes will be made by the Director directly to the IRS based upon the Director’s own personal tax situation. NASDAQ OMX will provide the Director with the appropriate 1099M in the year following the
vesting (additional tax information will be provided if the Director is filing taxes on a quarterly basis).
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Any future appreciation realized when a Director sells or transfers the vested RSA shares will be taxed at the applicable capital gains rate.
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NASDAQ OMX encourages its Directors to consult with a tax advisor before making a Section 83(b) election.
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Reporting and Disclosure
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SEC Form 4s (Change in Beneficial Ownership) must be filed by each Director with the SEC within 2 days of RSA grants. The Director may request NASDAQ’s
assistance in the preparation and filing of Section 16 reports via the “COMPANY ASSISTANCE WITH SECTION 16 REPORTING” form and by providing a completed Power of Attorney and CIK/CCC Code, if the Director has a CIK/CCC Code currently
assigned.
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RSAs will be reflected as stock owned by Directors in the Beneficial Ownership Table of the NASDAQ OMX Proxy and will be disclosed under the general Director
compensation section of the Proxy.
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Accounting
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RSAs are expensed by the issuer over the vesting period.
