Under the Serbian PITLaw and SSC Law, the employee's income from the employer based on own shares,options on own shares or own shares of the employer or shares, options onshares or shares of a person related to the employer that the employee acquireswithout compensation or at a preferential price from the employer, is exemptedfrom taxation, under the five conditions:

1) The basis, manner, and conditions of acquiring shares from the employeror from an employer’s related entity must be regulated by the general act ofthe employer or the employer’s related entity, employment contract, or otheract/document of the employer or the employer’s related entity (e.g. plan forrewarding the group, plan for giving free shares, a special agreement with theemployee, etc.) which contains the basis, manner, and conditions for acquiringshares

2) That the date of acquisition of the right to dispose of shares, aswell as the elements that qualitatively and quantitatively determine shares(type, number, percentage, etc.) can be determined with certainty

3) That the employee has not sold shares acquired from the employer orfrom an employer’s related entity, within two years from the acquisition of theright to dispose of those shares

4) That the employer or an employer’s related entity has not purchasedtheir shares from the employee. The period for this is unlimited.

5) That the employee's employment with the employer has not been terminated,except in some cases (e.g. retirement, disability, serving a prisonsentence...), before the expiration of two years from the day of acquiring theright to dispose of shares.