§235-9.5  Stock options from qualified hightechnology businesses excluded from taxation.  (a)  Notwithstanding any lawto the contrary, all income earned and proceeds derived from stock options orstock, including stock issued through the exercise of stock options orwarrants, from a qualified high technology business or from a holding companyof a qualified high technology business by an employee, officer, or director ofthe qualified high technology business, or investor who qualifies for thecredit under section 235-110.9, that would otherwise be taxed as ordinaryincome or as capital gains to those persons shall be excluded from taxationunder this chapter.

Similar provisions shall apply to options toacquire equity interests and to equity interests themselves with regard toentities other than corporations.

(b)  For the purposes of this section:

"Holding company of a qualified hightechnology business" means any business entity that possesses:

(1)  At least eighty per cent of the total votingpower of the stock or other interest; and

(2)  At least eighty per cent of the total value ofthe stock or other interest;

in the qualified high technology business.

"Income earned and proceeds derived fromstock options or stock" includes income from:

(1)  Dividends from stock or stock received throughthe exercise of stock options or warrants;

(2)  The receipt or the exercise of stock options orwarrants; or

(3)  The sale of stock options or stock, includingstock issued through the exercise of stock options or warrants.

"Qualified high technology business"means the same as defined in section 235-7.3. [L 1999, c 178, §20; am L 2000, c297, §7; am L 2001, c 221, §8]