As a general rule, you will be subject to ordinary income tax on the bargain element when you exercise non-qualified options. This amount is often included in your w-2 at year end.
Paying the tax may happen one of sevearl ways. First, companies will often withhold a statutory tax due at exercise. This is generally 22% for federal income tax, plus requisite Social Security, Medicare, and State tax (if any).
This 22% may or may not be enough, subject to your total taxable income at year end. If it is not enough, you may owe additional tax due when you file your tax return. One way to avoid this is to perform tax planning throughout the year, and make estimated tax payments if necessary.