Common use of Effect of Failure to Qualify for Incentive Stock Option Treatment Clause in Contracts

Effect of Failure to Qualify for Incentive Stock Option Treatment. To the extent that any portion of the Option does not qualify as an “incentive stock option,” it shall not affect the validity of the remainder of the Option and the portion which does not so qualify as an incentive stock option shall constitute a separate nonqualified stock option. If the Optionee disposes of any Shares acquired pursuant to the exercise of this Option before the later of (i) two years from the Grant Date and (ii) one year from the date the Shares are acquired, or if any other event occurs such that Optionee recognizes compensation income with respect to this Option, Optionee shall deliver to the Company any amount of federal, state or local income and employment tax withholding required by law. If Optionee fails to pay the withholding tax, the Company is authorized to withhold from any cash remuneration then or thereafter payable to Optionee any tax required to be withheld by reason of any disposition or other event described in this paragraph.