From: Richard Joslin < IMME>
To: Brad Wechsler < IMIMMI>, jeffrey E. <jeevacationgginail.com>
Subject: option exercise
Date: Wed, 01 Apr 2015 20:33:07 +0000
Re: non-qualified stock options (NQO) granted to LDB/ founders as part of services provided as director or public
company.
Apollo policy is for founders to report the option exercise as taxable income (1099-MISC issued by public company to
founder). Founder remits the after-tax cash profit to Apollo. Question was posited to to Glen Liebowitz/ John Suydam as
to whether Apollo would accept 100% disgorgement, ie Apollo reports 100% of the income and receives 100% of the net
cash exercise.
John Suydam has confirmed that Apollo will accept 100% of the cash. Net cash retained by LDB on NQO exercise after tax
would be payable to Apollo: $376,441.
Given that the 1099-MISC would be reported on LDB 1040, there is tax risk that assignment of income would not be
respected by the IRS notwithstanding the cash transfer/ disgorgement. I'd have to dig into this.
Richard Joslin
CFO
Elysium Management LLC
445 Park Ave
Ste. 1401
New York, NY 10022
(w)
(c)
(f)
EFTA00707727