Company: BSM
Filing Date: 2025-04-30
Form Type: DEF 14A
Source: 0001193125-25-107202
Chunk: 75

Company: Black Stone Minerals, L.P.
Filing Date: 2025-04-30
Form: DEF 14A
Chunk 75
---
'>62</div>

subordinated units for which an award has not previously been granted. The committee also has the right to alter or amend the 2025 LTIP or any part of it from time to time or to amend any outstanding award granted under the 2025 LTIP, provided that no change in any outstanding award may be made that would materially reduce the benefit to a participant immediately prior to such change without the consent of the affected participant.

#### U.S. Federal Income Tax Consequences
Unit Options and Unit Appreciation Rights

Participants will not realize taxable income upon the grant of a unit option or unit appreciation right. Upon the exercise of a unit option or an unit appreciation right, a participant will recognize ordinary compensation income (subject to the Partnership’s withholding obligations if the participant is an employee) in an amount equal to the excess of (i) the amount of cash and the fair market value of the common units received, over (ii) the exercise price of the award. A participant will generally have a tax basis in any common units received pursuant to the exercise of a option or unit appreciation right that equals the fair market value of such units on the date of exercise. Subject to the discussion under “Tax Consequences to the Partnership” below, the Partnership will be entitled to a deduction for federal income tax purposes that corresponds as to timing and amount with the compensation income recognized by a participant under the foregoing rules. When a participant sells the common units acquired as a result of the exercise of a unit option or unit appreciation right, any appreciation (or depreciation) in the value of the common units after the exercise date is treated as long- or short-term capital gain (or loss) for federal income tax purposes, depending on the holding period. The common units must be held for more than 12 months to qualify for long-term capital gain treatment.

Under current rulings, if a participant transfers previously held common units in satisfaction of part or all of the exercise price of an option, no additional gain will be recognized on the transfer of such previously held units in satisfaction of the option exercise price (although a participant would still recognize ordinary compensation income upon exercise of a option in the manner described above). Moreover, the number of common units received upon exercise which equals the number of common units of previously held common units surrendered in satisfaction of the option exercise price will have a tax basis that equals, and a capital gains holding period that includes, the tax basis and capital gains holding period of the previously held common units surrendered in satisfaction of the option exercise price. Any