Company: CPSS
Filing Date: 2025-10-28
Form Type: DEF 14A
Source: 0001683168-25-007815
Chunk: 30

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-10-28
Form: DEF 14A
Chunk 30
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 the market value of the shares
on the date of exercise over the exercise price, or (ii) the gain recognized on such disposition. In general, such amount will be
deductible by the Company for federal income tax purposes in the same year, as long as the amount constitutes reasonable compensation,
and the Company must comply with certain federal income tax reporting requirements with respect to such amount. In addition, the excess,
if any, of the amount realized on a disqualifying disposition over the Fair Market Value of the shares on the date of exercise will be
treated as capital gain.

A Participant who acquires shares by exercise
of a Nonqualified Stock Option generally realizes, as taxable ordinary income at the time of exercise, the difference between the Fair
Market Value of the shares and the exercise price. In general, such amount will be deductible by the Company in the same year, provided
that the amount constitutes reasonable compensation, and the Company must satisfy certain federal income tax withholding and reporting
requirements with respect to such amount. Subsequent appreciation or decline in the value of the shares on the sale or other disposition
of the shares generally will be treated as capital gain or loss.

A Participant generally will recognize ordinary
income upon the exercise of a SAR in an amount equal to the amount of cash received and the Fair Market Value of any shares received at
the time of settlement of the SAR, plus the amount of any taxes withheld. Such amount will ordinarily be deductible by the Company in
the same year as long as the amounts constitute reasonable compensation, and the Company must satisfy certain federal income tax withholding
and reporting requirements with respect to such amount.

A Participant who is granted a Restricted Stock
Award under the 2025 Equity Plan is not required to include the value of such shares in ordinary income until the first time such Participant’s
rights in the shares are transferable or are not subject to substantial risk of forfeiture, whichever occurs earlier, unless such Participant
timely files an election under Section 83(b) of the Code to be taxed on the receipt of the shares. A Participant who is granted RSUs
under the 2025 Equity Plan is not required to include the value of such RSUs in ordinary income until such time the value of the RSUs
is paid to the Participant in cash or stock. In the case of either Restricted Stock or RSUs, the amount of such income will be equal to
the Fair Market Value of the shares or RSUs at the time the income is recognized. The Company ordinarily