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The default treatment in a transaction like this is that you have sold everything, with the sale price measured by the FMV of what you received. For you, that would be the cash plus the FMV of the Occidential stock you receive.

Fortunately, most of the time management will arrange the transaction so that some part of it is tax deferred. But that is up to management to make that choice. They are the only ones who can tell you how the transaction will be taxed.

The typical tax-deferred scenario would be to allocate your cost between the cash and FMV of the shares received. The cash portion would then be treated as a sale and the shares received would take on the cost basis and acquisition date of the shares you had to surrender. But again, this is only one possibility.

Management will tell you exactly how the transaction is treated for tax purposes.

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