Company: NTWK
Filing Date: 2025-05-01
Form Type: DEF 14A
Source: 0001641172-25-007993
Chunk: 33

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-05-01
Form: DEF 14A
Chunk 33
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 next sentence, the exercise of an ISO. The difference between the exercise price and the fair market value of the shares on the exercise
date, however, will be a preference item for purposes of the alternative minimum tax, and thus a participant could be subject to the alternative
minimum tax as a result of the exercise of an ISO. If a participant holds the shares acquired upon exercise of an ISO for at least two
years following the option grant date and at least one year following exercise, the participant’s gain, if any, upon a subsequent disposition
of such shares is long-term capital gain. The measure of the gain is the difference between the proceeds received on disposition and the
participant’s basis in the shares (which generally equals the exercise price).

If a participant disposes of shares acquired pursuant to exercise
of an ISO before satisfying the one and two-year holding periods described above, then: (i) if the proceeds received exceed the exercise
price of the ISO, the participant will recognize capital gain equal to the excess, if any, of the proceeds received over the fair market
value of the shares on the date of exercise, and will recognize ordinary income equal to the excess, if any, of the lesser of the proceeds
received or the fair market value of the shares on the date of exercise over the exercise price of the ISO; or (ii) if the proceeds received
are less than the exercise price of the ISO, the participant will recognize a capital loss equal to the excess of the exercise price of
the ISO over the proceeds received. Capital gains recognized upon a disqualifying disposition will be taxable as long term capital gains
if the participant held the shares for more than one year after the exercise of the ISO, or otherwise as short-term capital gains if the
participant held the shares for less than one year after the exercise of the ISO. Capital losses recognized upon a disqualifying disposition
will offset long term capital gains if the participant held the shares for more than one year after the exercise of the ISO, or otherwise
will offset up to $3,000 of long-term or short-term capital gains each year with the remainder carried forward if the participant held
the shares for less than one year after the exercise of the ISO.

Our Company is not entitled to an income tax deduction on the grant
or exercise of an ISO or on the participant’s disposition of the shares after satisfying the holding period requirements described above.
If the holding periods are not satisfied, our Company will be entitled to a deduction in the year the