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CTI’s Chief Financial Officer (“CFO”). In general, the
Trading Window opens (i.e., trading is permissible) on
the third business day after CTI releases information
to the financial community about the prior quarter
results, and closes (i.e., trading is prohibited) at
the close of business on the fifteenth (15th) day of
the last month of a fiscal quarter. If the fifteenth
day of the month falls in a weekend, the window shall
close on the last business day preceding the fifteenth
day of the month.
The trading window was closed when petitioner exercised her
options on March 5, 2002. The trading window remained closed
until the third business day after May 13, 2002.
G. Petitioners’ 2002 Federal Income Tax Return
Petitioner received from CTI a 2002 Form 1099 in the amount
of $21,787.50. Petitioner also received from CTI a 2002 Form
W-2, Wage and Tax Statement, that reported that petitioner had
received $2,156,436.35 as wages, tips, or other compensation.
The Form W-2 listed $582,066.18 as the amount of Federal income
tax withheld. The wages reported by CTI on the Form W-2 included
the spread between the strike prices and the fair market value of
the stock received when petitioner exercised her stock options on
March 5, 2002.
On or about April 15, 2003, petitioners filed their 2002
Federal income tax return. They reported the following relevant
information on that return: $29,404 in wages, salaries, tips
etc.; business income of $19,324 ($21,788 in gross receipts less
$2,464 in expenses consisting of travel ($2,335) and meals and
entertainment ($129)); total adjusted gross income of $80,730;
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Last modified: November 10, 2007