Company: FFWM
Filing Date: 2025-04-17
Form Type: DEF 14A
Source: 0001104659-25-036041
Chunk: 54

Company: First Foundation Inc.
Filing Date: 2025-04-17
Form: DEF 14A
Chunk 54
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’s tax basis in any shares of common stock received upon 31 TABLE OF CONTENTS exercise of an SAR will be the fair market value of the shares of common stock on the date of exercise, and if the shares are later sold or exchanged, then the difference between the amount received upon such sale or exchange and the fair market value of such shares on the date of exercise will generally be taxable as long-term or short-term capital gain or loss (if the shares are a capital asset of the Participant) depending upon the length of time such shares were held by the Participant. Restricted Stock. A Participant who receives an award of restricted stock does not generally recognize taxable income at the time of the award. Instead, the Participant recognizes ordinary income in the first taxable year in which his or her interest in the shares becomes either: (A) freely transferable or (B) no longer subject to substantial risk of forfeiture. The amount of taxable income is equal to the fair market value of the shares less the cash, if any, paid for the shares. A Participant may elect to recognize income at the time of grant of restricted stock in an amount equal to the fair market value of the restricted stock (less any cash paid for the shares) on the date of the award. We receive a compensation expense deduction in an amount equal to the ordinary income recognized by the participant in the taxable year in which restrictions lapse (or in the taxable year of the award if, at that time, the participant had filed a timely Code Section 83(b) election to accelerate recognition of income). If such election is made, no additional taxable income will be recognized by such Participant at the time the restrictions lapse, the Participant will have a tax basis in the shares of common stock equal to their fair market value on the date of their award, and the Participant’s holding period for capital gains purposes will begin at that time. Unless the individual has made an election under Code Section 83(b), any cash dividends paid on the shares of common stock before the restrictions lapse will be taxable to the Participant as additional compensation and not as dividend income. Restricted Stock Units. No taxable income is generally reportable when unvested restricted stock units are granted to a participant and this will result in no tax deduction for us. Upon settlement of stock units which have vested in cash or shares of common stock, the participant will recognize ordinary income at the time(s) of settlement equal to the sum of the fair market value (on each settlement date) of any shares issued to the participant plus any cash received by the