The Harris Texas Directors Stock Appreciation Rights Plan of American Annuity Group, Inc. is a comprehensive compensation program designed to reward and retain the top talent serving on the board of directors of the company. This plan ensures that the interests of the directors are aligned with those of the shareholders, promoting long-term value creation and business sustainability. Keywords: Harris Texas, Directors Stock Appreciation Rights Plan, American Annuity Group, compensation program, board of directors, shareholders, long-term value creation, business sustainability. The Harris Texas Directors Stock Appreciation Rights Plan offers directors the opportunity to receive stock appreciation rights, which grant them the right to receive the appreciation in the value of American Annuity Group, Inc.'s common stock over a specified period. The value is calculated based on the difference between the fair market value of the stock at the time of exercise and the grant price. This plan serves as a powerful incentive for directors to actively contribute to the growth and success of the company. It ensures that their efforts directly contribute to enhancing shareholder value, as they are rewarded based on the performance of American Annuity Group, Inc.'s stock. Different types of Harris Texas Directors Stock Appreciation Rights Plans offered by American Annuity Group, Inc. may include: 1. Performance-Based Stock Appreciation Rights Plan: This plan rewards directors based on predefined performance metrics achieved by the company. These metrics may include financial goals such as revenue growth, earnings per share, or return on investment. Directors receive stock appreciation rights if the company achieves or exceeds these performance targets. 2. Time-Based Stock Appreciation Rights Plan: Under this plan, directors become eligible for stock appreciation rights after a specific period of service on the board. For example, directors may be granted stock appreciation rights after one year of continuous service, providing long-term incentives to retain experienced and dedicated individuals. 3. Restricted Stock Appreciation Rights Plan: This plan grants directors the right to receive stock appreciation rights after certain conditions are met. These conditions may include the attainment of specific milestones, successful completion of strategic initiatives, or the achievement of certain company-wide objectives. Once these conditions are fulfilled, directors can exercise their stock appreciation rights. 4. Equity-Based Stock Appreciation Rights Plan: In this plan, directors are granted stock appreciation rights that are tied to the value of the company's common stock. As the stock price increases, directors have the opportunity to benefit from the growth in shareholder value, making this plan particularly attractive for aligning the interests of directors with those of the investors. Overall, the Harris Texas Directors Stock Appreciation Rights Plan of American Annuity Group, Inc. serves as a crucial component of the company's compensation strategy, motivating directors to actively contribute to the company's success and ensuring their interests remain closely aligned with the shareholders'.
Harris Texas Directors Stock Appreciation Rights Plan of American Annuity Group, Inc.
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FAQ
A Stock Appreciation Right (SAR) is an award which provides the holder with the ability to profit from the appreciation in value of a set number of shares of company stock over a set period of time.
Stock Appreciation Rights as Equity Sometimes employers choose to issue stock appreciation rights payments only in the form of stock. If this is the case, the rights are accounted for using an equity method. The rights are valued once, divided evenly over the vesting period and marked as rights paid in capital.
Stock appreciation rights are NOT deferred compensation subject to the special timing rule under IRC §3121(v)(2).
Once a stock appreciation right vests, an employee can exercise it at any time prior to its expiration. The proceeds will be paid either in cash, shares, or a combination of cash and shares depending on the rules of an employee's plan.
Stock appreciation rights (SARs) are similar to employee stock options in that they give the holder the right to purchase shares of the company's stock at a set price. However, with SARs, the holder does not have to exercise their rights in order to receive the benefit.
Stock appreciation rights are treated as taxable income when you exercise them. If you receive shares of stock instead of cash, and then decide to sell those shares, you may owe capital gains tax on the appreciated value.
Deferred compensation is an addition to an employee's regular compensation that is set aside to be paid at a later date. In most cases, taxes on this income are deferred until it is paid out. There are many forms of deferred compensation, including retirement plans, pension plans, and stock-option plans.
RSUs are deferred compensation whenever the payment is made, or could be made, in a calendar year later than the year in which the awards vest (or in 409A-speak, in the year awards become ?no longer subject to a substantial risk of forfeiture.?) Any forfeiture risk due to a non-compete or similar covenant is ignored
SARs are taxed the same way as non-qualified stock options (NSOs). There are no tax consequences of any kind on either the grant date or when they are vested. However, participants must recognize ordinary income on the spread at the time of exercise. 2 Most employers will also withhold supplemental federal income tax.