Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A. (ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A. (iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit.
Appears in 1 contract
Sources: Employment Agreement (Emtec Inc/Nj)
Code Section 409A Compliance. (i) The intent parties hereto recognize that certain provisions of this Agreement may be affected by Section 409A of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code and guidance issued thereunder, and agree to amend this Agreement, or take such other action as may be necessary or advisable, to comply with Section 409A. It is intended that all payments hereunder shall comply with Section 409A and the regulations and guidance promulgated thereunder so as to not subject the Executive to payment of interest or any additional tax under Section 409A. In furtherance thereof, if payment or provision of any amount or benefit hereunder (collectively, including any transfer to a “rabbi” trust or similar funding entity) that is subject to Section 409A at the time specified herein would subject such amount or benefit to any additional tax under Section 409A”) and, accordinglythe payment or provision of such amount or benefit shall be postponed to the earliest date on which the payment or provision of such amount or benefit could be made without incurring such additional tax. In addition, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (regulations or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest other guidance issued under Section 409A (with specificity as after application of the previous provisions of this Section (13)(j)) would result in the Executive’s being subject to the reason therefore) payment of interest or any additional tax under Section 409A, the Company independently makes parties agree, to the extent reasonably possible, to amend this Agreement in order to avoid the imposition of any such determinationinterest or additional tax under Section 409A, which amendment shall have the minimum economic effect necessary and be reasonably determined in good faith by the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Executive. Notwithstanding anything contained herein to the contrary, it is expressly understood that at any time the Company shall not (ior any related employer treated with the Company as the service recipient for purposes of Code Section 409A) is publicly traded on an established securities market (as defined for purposes of Code Section 409A), if a payment or provision of an amount or benefit constituting a deferral of compensation is to be obligated to modify or amend this Agreement in any manner made pursuant to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision terms of this Agreement to the contrary, if Executive on account of a Separation from Service (as defined under the UIL CIC Plan II) at a time when the Executive is a “specified employee” within the meaning Specified Employee (as defined for purposes of Code Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A409A(a)(2)(B)(i)), then such payment or benefit required under this Agreement deferred compensation shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of date that is six (6) months after the taxable year following the taxable year in which such expenses were incurred by ExecutiveSeparation from Service. In additionthe event this restriction applies, no such reimbursement or expenses eligible the deferred compensation that the Executive would have otherwise been entitled to during the restriction period will be accumulated and paid (without adjustment for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or delay in-kind benefits shall not be subject to liquidation or exchanged for another benefit.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. a. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Internal Revenue Code (“Code”) Section 409A (with specificity as to the reason therefore) or the Company independently makes such determinationany regulations or Treasury guidance promulgated thereunder, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (provision, to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order possible, to comply with or be exempt from Code Section 409A; provided, that the Company agrees to make only such modification shall be made in good faith changes as are necessary to bring such provisions into compliance with Code Section 409A and shallto maintain, to the maximum extent reasonably possiblepracticable, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) b. Notwithstanding any other provision of this Agreement to the contrarycontrary in this Agreement, if the Executive is deemed on the date of termination of employment to be a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Section 409A if 409A(a)(2)(B) such payment or benefit is paid within shall not be made or provided (subject to the last sentence hereof) prior to the earlier of (i) the expiration of the six months after (6)-month period measured from the date of the Executive’s “separation from service” (within the meaning of-as such term is defined in Treasury Regulations issued under Code Section 409A) or (ii) the date of Executive’s death (the “Deferral Period”). Upon the expiration of the Deferral Period, then all payments and benefits deferred pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such payment or benefit required under this Agreement deferral) shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then and any amounts payable hereunder on account of a termination of the Executive’s employment remaining payments and which are subject to Section 409A benefits due under this Agreement shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenormal payment dates specified for them herein. Notwithstanding the foregoing, but in any event shall be made on or prior to the last day extent that the foregoing applies to the provision of any ongoing welfare benefits to the taxable year following Executive that would not be required to be delayed if the taxable year in which ME1 15728518v.2 premiums therefor were paid by the Executive, the Executive shall pay the full cost of premiums for such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect welfare benefits during the expenses eligible for reimbursement in any other taxable year Deferral Period and the Executive’s right Company shall pay (or cause to reimbursement or in-kind benefits shall not be subject paid) to liquidation or exchanged for another benefitthe Executive an amount equal to the amount of such premiums paid by the Executive during the Deferral Period promptly after its conclusion.
Appears in 1 contract
Sources: Change in Control Severance Agreement (Stewardship Financial Corp)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made on the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (B) the date of Executive’s death, to the extent required under Code Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Companynormal payment dates specified for them herein.
(c) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following the date of Executive’s policies termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in effect from time the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to timebe provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, but in then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any event payment made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payment made thereafter shall continue as provided herein.
(d) To the extent that any expense reimbursement or in-kind benefit under this Agreement constitutes “non-qualified deferred compensation” for purposes of Code Section 409A, (i) such expense or other reimbursement hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (ii) any right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit, and (iii) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, Executive’s right to receive installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of Employer.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Unless this Agreement provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or exchanged other compensation is to be paid for another benefita specified continuing period of time beyond the date of Executive’s termination of employment in accordance with Employer’s payroll practices (or other similar term), the payments of such base salary or other compensation shall be made upon such schedule as in effect upon the date of termination, but no less frequently than monthly.
(h) Any annual bonus payable to Executive in accordance with the provisions of Section 3(b) hereof shall be paid in the calendar year following the calendar year to which such bonus relates at the same time bonuses are paid to other senior executive officers of Employer generally.” The parties have duly executed this Agreement as of the date first written above.
Appears in 1 contract
Sources: Employment Agreement (Seabright Insurance Holdings Inc)
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 7 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2‑1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2‑1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in‑kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in‑kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or in-kind benefits shall not the provision of any in‑kind benefit be subject to liquidation or exchanged exchange for another benefit.
(d) The provisions of this Section 7 shall also apply to all payments and benefits that may be provided under the Change in Control Agreement, notwithstanding any provision to the contrary contained therein, if required in order to comply with Section 409A. In addition to the provisions set forth in subsections (a) through (c) above: (i) the cash severance payable under the Change in Control Agreement shall be paid at the same time and in the same form provided under this Agreement for severance payable under Section 5(b) (that is, in installments over twenty‑four (24) months rather than a lump sum) unless the Executive’s separation from service occurs within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A‑3(i)(5); (ii) if the Executive’s separation from service does occur within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A‑3(i)(5), then the cash severance payable to the Executive under Section 1(b)(1) of the Change in Control Agreement shall be paid on the sixtieth (60th) day following his separation from service (subject to Section 7(b)) provided the Executive has fulfilled the conditions for payment of the cash severance under the Change in Control Agreement (including that the Release of Claims as defined therein shall have become effective) on or before such date (and shall not be paid otherwise); and (iii) any reimbursement of taxes required to be made by the Company under the Change in Control Agreement shall be made by the end of the calendar year next following the calendar year in which the Executive remits the related taxes. If the payment of cash severance has commenced pursuant to Section 5(b)(1) of this Agreement before the occurrence of a Change in Control that results in the Executive’s eligibility for severance benefits under the Change in Control Agreement, then the payment of cash severance shall be governed by the Change in Control Agreement rather than Section 5(b)(1) of this Agreement, and any adjustment to reflect an underpayment or overpayment of the amount that otherwise would have been due before the Change in Control pursuant to the Change in Control Agreement shall be applied to the first installment due after the Change in Control Agreement, proceeding in chronological order thereafter as necessary.
Appears in 1 contract
Code Section 409A Compliance. (iA) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If Any payments that qualify for the Executive provides short-term deferral exception, the separation pay exception or another exception under Code Section 409A shall be paid under the applicable exception to the maximum extent permitted. Each payment of compensation under this Agreement shall be treated as a separate payment of compensation for all purposes under Code Section 409A. In the event that the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines reasonably and in Section 409A good faith that there is any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would that could cause the Executive to incur any be subject to additional tax tax, interest or interest penalties under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from provisions of Code Section 409A, such modification provision shall be made interpreted and resolved in the manner the Company reasonably and in good faith and shall▇▇▇▇▇ ▇▇▇▇▇ necessary to prevent the application of such taxes, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and interest or penalties under Code Section 409A. In no event whatsoever shall the Company of be liable for any additional tax, interest or penalty that may be imposed on the applicable provision without violating the provisions of Executive by Code Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iiB) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service”, such payment or benefit shall not be made or provided until the date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” within of the meaning Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiiC) All To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute “deferred compensation” under Code Section 409A unless such release is signed and delivered, and the period for revocation has expired, within sixty (60) days following the date of the Executive’s termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Code Section 409A, then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(D) With respect to reimbursements or other in-kind benefits under this Agreement, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(E) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be, to the extent permitted under Code Section 409A, within the sole discretion of the Company.
(F) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (iA) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in by Code Section 409A that or damages for failing to comply with Code Section 409A.
(B) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible providing for the failure payment of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service”, such payment or benefit shall not be made or provided until the date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” within of the meaning Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiiC) All To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute a “deferral of compensation” under Code Section 409A unless such release is signed and delivered within sixty (60) days following the date of the Executive’s termination of employment. In this regard, the Company agrees to provide the Executive with the form of release required under Section 5(J) no later than 5 days after the Executive’s termination date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to be provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(D) To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(E) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(F) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
24. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Employment Agreement.
25. This Agreement is an amendment to the Employment Agreement, and to the extent there is a discrepancy between this Agreement and the Employment Agreement, this Agreement shall control and supersede the Employment Agreement to the extent of such discrepancy. The Employment Agreement otherwise remains in full force and effect.
26. This Agreement, the Employment Agreement (as further amended by this Agreement), and those documents expressly referred to herein embody the complete agreement and understanding among the parties and supersede and preempt and prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
Appears in 1 contract
Sources: Employment and Non Competition Agreement (Vitamin Shoppe, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted and applied so as to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the The Company and the Executive agree to work together in good faith to reform consider amendments to this Agreement and to take such provision (reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “non-qualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination”, “termination of employment”, or like terms shall mean “separation from service”. If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6) -month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 26(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred. For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the General Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the General Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Sources: Employment Agreement (Amylyx Pharmaceuticals, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, then for purposes of any amounts payable hereunder on account such provision of this Agreement, references to a “termination,” “termination of the Executive’s employment and which are subject to Section 409A employment” or like terms shall not be paid until the Executive has experienced a mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time409A(a)(2)(B), but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit.then
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 8 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2 1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2 1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in-kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or the provision of any in-kind benefits shall not benefit be subject to liquidation or exchanged exchange for another benefit.
(d) The provisions of this Section 8 shall also apply to all payments and benefits that may be provided under the Change in Control Agreement, notwithstanding any provision to the contrary contained therein, if required in order to comply with Section 409A. In addition to the provisions set forth in subsections (a) through (c) above: (i) the cash severance payable under the Change in Control Agreement shall be paid at the same time and in the same form provided under this Agreement for severance payable under Section 6(b) (that is, in installments over twenty-four (24) months rather than a lump sum) unless the Executive’s separation from service occurs within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5); (ii) if the Executive’s separation from service does occur within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5), then the cash severance payable to the Executive under Section 1(b)(1) of the Change in Control Agreement shall be paid on the sixtieth (60th) day following his separation from service (subject to Section 8(b)) provided the Executive has fulfilled the conditions for payment of the cash severance under the Change in Control Agreement (including that the Release of Claims as defined therein shall have become effective) on or before such date (and shall not be paid otherwise); and (iii) any reimbursement of taxes required to be made by the Company under the Change in Control Agreement shall be made by the end of the calendar year next following the calendar year in which the Executive remits the related taxes. If the payment of cash severance has commenced pursuant to Section 6(b)(1) of this Agreement before the occurrence of a Change in Control that results in the Executive’s eligibility for severance benefits under the Change in Control Agreement, then the payment of cash severance shall be governed by the Change in Control Agreement rather than Section 6(b)(1) of this Agreement, and any adjustment to reflect an underpayment or overpayment of the amount that otherwise would have been due before the Change in Control pursuant to the Change in Control Agreement shall be applied to the first installment due after the Change in Control Agreement, proceeding in chronological order thereafter as necessary.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to penalty that may be imposed on the extent that such modification Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding An “Employment Separation” shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during following an Employment Separation unless such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute Employment Separation is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to an Employment Separation or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall be made or provided at the meaning date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 409A.(whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiic) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event under this Agreement shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive (provided that if any such reimbursements constitute taxable income to the Executive. In addition, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and year.
(d) For purposes of Code Section 409A, the Executive’s right to reimbursement receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within thirty (30) days”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
(e) In no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitotherwise.” By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Title: Vice President, Chief Human Resources Officer /s/ C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Executive Vice President and Chief Financial Officer
Appears in 1 contract
Sources: Change in Control & Non Competition Agreement (Commercial Vehicle Group, Inc.)
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 8 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2 1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2 1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Notwithstanding any contrary provision herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in-kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or the provision of any in-kind benefits shall not benefit be subject to liquidation or exchanged exchange for another benefit.. (d)
Appears in 1 contract
Code Section 409A Compliance. (i) The intent parties hereto recognize that certain provisions of this Agreement may be affected by Section 409A of the parties is that payments Code and benefit under guidance issued thereunder, and agree to amend this Agreement Agreement, or take such other action as may be necessary or advisable, to comply with or be exempt from Internal Revenue Code Section 409A. It is intended that all payments hereunder shall comply with Section 409A and the regulations and guidance promulgated thereunder (collectivelyso as to not subject the Executive to payment of interest or any additional tax under Section 409A. In furtherance thereof, “if payment or provision of any amount or benefit hereunder that is subject to Section 409A at the time specified herein would subject such amount or benefit to any additional tax under Section 409A”) and, accordinglythe payment or provision of such amount or benefit shall be postponed to the earliest date on which the payment or provision of such amount or benefit could be made without incurring such additional tax. In addition, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (regulations or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest other guidance issued under Section 409A (with specificity as after application of the previous provisions of this Section (12)G)) would result in the Executive's being subject to the reason therefore) payment of interest or any additional tax under Section 409A, the Company independently makes parties agree, to the extent reasonably possible, to amend this Agreement in order to avoid the imposition of any such determinationinterest or additional tax under Section 409A, which amendment shall have the minimum economic effect necessary and be reasonably determined in good faith by the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Executive. Notwithstanding anything contained herein to the contrary, it is expressly understood that at any time the Company shall not (ior any related employer treated with the Company as the service recipient for purposes of Code Section 409A) is publicly traded on an established securities market (as defined for purposes of Code Section 409A), if a payment or provision of an amount or benefit constituting a deferral of compensation is to be obligated to modify or amend this Agreement in any manner made pursuant to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision terms of this Agreement to the contrary, if Executive on account of a Separation from Service (as defined herein) at a time when the Executive is a “specified employee” within the meaning Specified Employee (as defined for purposes of Code Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A409A(a)(2)(B)(i)), then such payment or benefit required under this Agreement deferred compensation shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive prior to the date that is six (6) months after the Separation from Service. In the event this restriction applies, the deferred compensation that the Executive would have otherwise been entitled to during the restriction period will be accumulated and paid (without adjustment for the delay in a lump-sum cash payment, without interest, ) on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment 's Separation from Service. The parties hereto intend that the Agreement, as amended, be consistent with IRS Notice 2007-78, IRS Notice2007-86 and which are subject to other Code Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein transition relief, and it shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitinterpreted accordingly.
Appears in 1 contract
Code Section 409A Compliance. (i) a. The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement damages for failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(ii) Notwithstanding b. A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service. Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall be made on the meaning date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (ii) the date of Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this paragraph (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
c. To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (iiii) All all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in (ii) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
d. Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment or benefit under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive the Employee and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) Notwithstanding To the extent required for purposes of Code Section 409A, if applicable, a termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Employee is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall not be made or provided until the meaning date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Employee, and (B) the date of the Employee’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 15(b)(ii) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Employee in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iii) All To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (A) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionthe Employee, no such reimbursement or expenses eligible for reimbursement in (B) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (C) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. For purposes of Code Section 409A, the Employee’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company. Neither the Company nor employee or representative of the Company shall have any liability to Employee with respect to any action taken hereunder.
Appears in 1 contract
Code Section 409A Compliance. (i) The 8.1. It is the Company's intent of the parties is that payments compensation and benefit benefits to which you are entitled under this Agreement comply with or not be exempt from treated as "nonqualified deferred compensation" under Section 409A of the Internal Revenue Code Section 409A of 1986, as amended, and the treasury regulations and other official guidance promulgated thereunder (collectively, “"Code Section 409A”) and"), accordingly, to and that any ambiguities in the maximum extent permitted, construction of this Agreement shall be interpreted in order to be in compliance therewitheffectuate such intent. If In the Executive provides event that the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines, in its sole discretion, that any compensation or benefits to which you are entitled under this Agreement could be treated as "nonqualified deferred compensation" under Code Section 409A that unless this Agreement is amended or modified, the Company may, in its sole discretion, amend or modify this Agreement without obtaining any additional consent from you, so long as such amendment or modification does not materially affect the net present value of the compensation or benefits to which you otherwise would be entitled under this Agreement.
8.2. A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a "separation from service" within the meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references to a "termination," "termination of employment" or like terms shall mean "separation from service." If you are deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any payment or the provision of any benefit that is considered "nonqualified deferred compensation" under Code Section 409A payable on account of a "separation from service," such payment or benefit shall be made or provided at the date which is the earlier of (a) the expiration of the six (6) month period measured from the date of your "separation from service," and (b) the date of your death (the "Delay Period"). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to you in a lump sum, and any award remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
8.3. If a general release of compensationclaims, including equity compensation or benefits) would cause Executive to incur any additional tax or interest as contemplated under Section 409A 7 hereof, is executed and delivered (with specificity as and no longer subject to revocation) in the reason thereforemanner provided in said Section 7, then the following shall apply:
(a) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof the Severance Pay is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company not "nonqualified deferred compensation" for purposes of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Code Section 409A, then any the Severance Pay shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the "Release Effective Date"). The first such cash payment shall include payment of all amounts payable hereunder on account that otherwise would have been due prior to the Release Effective Date under the terms of a this Agreement applied as though such payments commenced immediately upon your termination of the Executive’s employment employment, and which are subject to Section 409A any payments made thereafter shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.continue as provided herein.
(iiib) All To the extent that the Severance Pay is "nonqualified deferred compensation" for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following your termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon your termination of employment, and any payments made thereafter shall continue as provided herein.
8.4. For purposes of compliance with Code Section 409A, (a) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionyou, (b) any right to reimbursement or in kind benefits is not subject to liquidation or exchange for another benefit, and (c) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement reimbursement, or in kind benefits to be provided, in any other taxable year and the Executive’s year.
8.5. For purposes of Code Section 409A, your right to reimbursement or in-kind benefits receive any installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments.
8.6. In no event shall any payment under this Agreement that constitutes "nonqualified deferred compensation" for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
8.7. In no event whatsoever shall the Company be liable for any additional tax, interest or exchanged penalty that may be imposed on you by Code Section 409A or damages for another benefit.failing to comply with Code Section 409A.
Appears in 1 contract
Sources: Letter Agreement of Employment (New York & Company, Inc.)
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. a. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Internal Revenue Code (“Code”) Section 409A (with specificity as to the reason therefore) or the Company independently makes such determinationany regulations or Treasury guidance promulgated thereunder, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (provision, to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order possible, to comply with or be exempt from Code Section 409A; provided, that the Company agrees to make only such modification shall be made in good faith changes as are necessary to bring such provisions into compliance with Code Section 409A and shallto maintain, to the maximum extent reasonably possiblepracticable, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) b. Notwithstanding any other provision of this Agreement to the contrarycontrary in this Agreement, if the Executive is deemed on the date of termination of employment to be a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Section 409A if 409A(a)(2)(B) such payment or benefit is paid within shall not be made or provided (subject to the last sentence hereof) prior to the earlier of (i) the expiration of the six months after (6)-month period measured from the date of the Executive’s “separation from service” (within the meaning of-as such term is defined in Treasury Regulations issued under Code Section 409A) or (ii) the date of Executive’s death (the “Deferral Period”). Upon the expiration of the Deferral Period, then all payments and benefits deferred pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such payment or benefit required under this Agreement deferral) shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then and any amounts payable hereunder on account of a termination of the Executive’s employment remaining payments and which are subject to Section 409A benefits due under this Agreement shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenormal payment dates specified for them herein. Notwithstanding the foregoing, but in any event shall be made on or prior to the last day extent that the foregoing applies to the provision of any ongoing welfare benefits to the taxable year following Executive that would not be required to be delayed if the taxable year in which -10- ME1 15728518v.2 premiums therefor were paid by the Executive, the Executive shall pay the full cost of premiums for such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect welfare benefits during the expenses eligible for reimbursement in any other taxable year Deferral Period and the Executive’s right Company shall pay (or cause to reimbursement or in-kind benefits shall not be subject paid) to liquidation or exchanged for another benefitthe Executive an amount equal to the amount of such premiums paid by the Executive during the Deferral Period promptly after its conclusion.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties This Agreement is that payments and benefit under this Agreement intended to comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Code Section 409A409”) and, accordingly, to the maximum extent permitted, this Agreement or an exemption thereunder and shall be interpreted to be construed and administered in compliance therewith. If the Executive provides the Company accordance with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement, payments provided under the Agreement to the contrary, if the Executive is may only be made upon an event and in a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under manner that complies with Code Section 409A if such payment or benefit is paid within six months after an applicable exemption. Any payments under the Executive’s “separation Agreement that may be excluded from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid either as separation pay due to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s an involuntary separation from service or (ii) as a short-term deferral shall be excluded from Code Section 409A to the 10th business day following maximum extent possible. Any payments to be made under the Executive’s death. If the Executive’s Agreement upon a termination of employment hereunder does not constitute shall only be made upon a “separation from service” within under Code Section 409A. In no event shall the meaning of Section 409A, then any amounts payable hereunder on account of a termination timing of the Executive’s employment execution of a Waiver and which are Release Agreement, directly or indirectly, result in the Executive designating the calendar year of any severance payment, and if a payment that is subject to Section 409A shall not execution of the Waiver and Release Agreement could be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein made in more than one taxable year, payment shall be payable made in the later taxable year. For purposes of Code Section 409A, the right to installment payments of severance shall be treated as the right to a series of separate payments. To the extent required by Code Section 409A, any reimbursement or in-kind benefit provided under the Agreement shall be provided in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to following: (a) the last day amount of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable reimbursement, or in-kind benefits provided, during a calendar year shall in any way cannot affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other calendar year; and (b) any right to reimbursements or in-kind benefits under the Agreement shall not be subject to liquidation or exchanged exchange for another benefit.. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under the Agreement comply with Code Section 409A and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Executive on account of non-compliance with Code Section 409A.
Appears in 1 contract
Sources: Employment Transition Severance Agreement (Ecolab Inc.)
Code Section 409A Compliance. (i) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from the definition of “nonqualified deferred compensation” under Section 409A of the Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder of 1986, as amended (collectively, “Section 409A”) ), in accordance with one or more of the exemptions available under the final Treasury Regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409A) possible in a manner consistent with the foregoing statement of intent. For purposes of this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive a series of separate payments and benefits to the minimum fullest extent reasonably necessary to conform with allowed by Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company 409A of the applicable provision without violating the provisions of Section 409A. Code.
(ii) Notwithstanding anything contained herein in this Agreement or elsewhere to the contrary, for purposes of determining the Company shall not (i) be obligated to modify or amend payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A that become payable under this Agreement in any manner connection with a termination of employment, the date that the Executive is deemed to have incurred a termination of employment shall be the extent that such modification or amendment would (a) increase date on which the Company’s obligations hereunder, (b) increase any amounts owed by Executive has incurred a “separation from service” within the Company hereunder or (c) otherwise accelerate the timing meaning of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply withTreasury Regulation section 1.409A-1(h), or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive in subsequent Internal Revenue Service guidance under Section 409A.
(iiiii) Notwithstanding any other provision of anything in this Agreement or elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the date of the Executive’s “separation from service” (within the meaning of-of Treasury Regulation Section 409A1.409A-1(h), then such payment ) and (B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided on the scheduled payment dates specified in Section 8(a) through (c), will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the date of the Executive’s separation from service or (ii) or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If In the Executive’s termination of employment hereunder does not constitute event that this Section 8(e)(iii) requires any payments to be withheld, such withheld payments shall be accumulated and paid in a single lump sum, with interest equal to the “separation from serviceshort-term applicable Federal rate” (within the meaning of Section 409A, then any amounts payable hereunder on account of a termination 1274(d) of the Executive’s employment Code), compounded annually, in effect on the date of such termination, on the Delayed Payment Date and which are the balance of the payments shall be made as otherwise scheduled.
(iv) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A to be made to the Executive within a designated period (e.g., within 30 days after the date of termination) and such period begins and ends in different calendar years, the exact payment date within such range shall, subject to Section 409A shall not 8(e)(iii) above, be paid until determined by the Company, in its sole discretion, and the Executive has experienced a “separation from service” within shall have no right to designate the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year the payment shall in any way affect the expenses eligible for reimbursement in any other taxable year be made.
(v) The Company and the ExecutiveExecutive may agree to take other actions to avoid the imposition of a Section 409A Tax at such time and in such manner as permitted under Section 409A. To the extent applicable, each of the exceptions to Section 409A’s right to reimbursement prohibition on acceleration of payments of deferred compensation provided under Treasury Regulation 1.409A-3(j)(4) shall be permitted under this Agreement.
(vi) Each of the Company and the Executive acknowledge and agree that (A) they have had their own independent legal counsel review this Agreement for purposes of compliance with the requirements of Section 409A or in-kind benefits shall not be subject to liquidation or exchanged an exemption therefrom, and (B) each party is relying solely on the advice of its independent legal counsel for another benefitsuch purposes.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 8 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2-1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2-1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in-kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or the provision of any in-kind benefits shall not benefit be subject to liquidation or exchanged exchange for another benefit.
(d) The provisions of this Section 8 shall also apply to all payments and benefits that may be provided under the Change in Control Agreement, notwithstanding any provision to the contrary contained therein, if required in order to comply with Section 409A. In addition to the provisions set forth in subsections (a) through (c) above: (i) the cash severance payable under the Change in Control Agreement shall be paid at the same time and in the same form provided under this Agreement for severance payable under Section 6(b) (that is, in installments over twenty-four (24) months rather than a lump sum) unless the Executive’s separation from service occurs within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5); (ii) if the Executive’s separation from service does occur within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5), then the cash severance payable to the Executive under Section 1(b)(1) of the Change in Control Agreement shall be paid on the sixtieth (60th) day following his separation from service (subject to Section 8(b)) provided the Executive has fulfilled the conditions for payment of the cash severance under the Change in Control Agreement (including that the Release of Claims as defined therein shall have become effective) on or before such date (and shall not be paid otherwise); and (iii) any reimbursement of taxes required to be made by the Company under the Change in Control Agreement shall be made by the end of the calendar year next following the calendar year in which the Executive remits the related taxes. If the payment of cash severance has commenced pursuant to Section 6(b)(1) of this Agreement before the occurrence of a Change in Control that results in the Executive’s eligibility for severance benefits under the Change in Control Agreement, then the payment of cash severance shall be governed by the Change in Control Agreement rather than Section 6(b)(1) of this Agreement, and any adjustment to reflect an underpayment or overpayment of the amount that otherwise would have been due before the Change in Control pursuant to the Change in Control Agreement shall be applied to the first installment due after the Change in Control Agreement, proceeding in chronological order thereafter as necessary.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent parties hereto recognize that certain provisions of this Agreement may be affected by Section 409A of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code and guidance issued thereunder, and agree to amend this Agreement, or take such other action as may be necessary or advisable, to comply with Section 409A. It is intended that all payments hereunder shall comply with Section 409A and the regulations and guidance promulgated thereunder (collectivelyso as to not subject the Executive to payment of interest or any additional tax under Section 409A. In furtherance thereof, “if payment or provision of any amount or benefit hereunder that is subject to Section 409A at the time specified herein would subject such amount or benefit to any additional tax under Section 409A”) and, accordinglythe payment or provision of such amount or benefit shall be postponed to the earliest date on which the payment or provision of such amount or benefit could be made without incurring such additional tax. In addition, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (regulations or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest other guidance issued under Section 409A (with specificity as after application of the previous provisions of this Section (10)(k) would result in the Executive’s being subject to the reason therefore) payment of interest or any additional tax under Section 409A, the Company independently makes parties agree, to the extent reasonably possible, to amend this Agreement in order to avoid the imposition of any such determinationinterest or additional tax under Section 409A, which amendment shall have the minimum economic effect necessary and be reasonably determined in good faith by the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Executive. Notwithstanding anything contained herein to the contrary, it is expressly understood that at any time the Company shall not (ior any related employer treated with the Company as the service recipient for purposes of Section 409A) is publicly traded on an established securities market (as defined for purposes of Section 409A), if a payment or provision of an amount or benefit constituting a deferral of compensation is to be obligated to modify or amend this Agreement in any manner made pursuant to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision terms of this Agreement to the contrary, if Executive on account of a Separation from Service at a time when the Executive is a “specified employee” within the meaning Specified Employee (as defined for purposes of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A409A(a)(2)(B)(i)), then such payment or benefit required under this Agreement deferred compensation shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive prior to the date that is six (6) months after the Separation from Service. In the event this restriction applies, the deferred compensation that the Executive would have otherwise been entitled to during the restriction period will be accumulated and paid (without adjustment for the delay in a lump-sum cash payment, without interest, ) on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment and which are subject Separation from Service or, if earlier, the Executive’s estate or personal representative upon his death. Each payment made in a series of payments under this Agreement shall be deemed to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning separate payment for purposes of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties This Agreement is intended to be drafted in a manner such that payments and no amount or other benefit provided under this Agreement comply with or be exempt from becomes subject to (a) gross income inclusion under Section 409A of the Internal Revenue Code (“Section 409A”) or (b) interest and additional tax under Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A409A Penalties”) and), accordinglyincluding, where appropriate, the construction of defined terms to have meanings that would not cause the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If imposition of the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A Penalties. Any provisions of the Agreement that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive are subject to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order are intended to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company all applicable requirements of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxesan exemption from the application of Section 409A, penalties or interest incurred by Executive under Section 409A.
(ii) and shall be interpreted and administered accordingly. Notwithstanding any other provision of this Agreement to the contrary, if any benefit provided hereunder would be subject to Section 409A Penalties because the Executive timing of such benefit is not delayed as required by Section 409A for a “specified employee” within the meaning of (as defined under Section 409A), and then if Grantee is on the applicable date a payment or specified employee, any such benefit provided for in this Agreement that Grantee would otherwise be subject entitled to additional tax under Section 409A if such payment or benefit is paid within receive during the first six months after the Executivefollowing Grantee’s “separation from service” (within the meaning of-as defined under Section 409A)) shall be accumulated and paid, then such payment or benefit required under this Agreement shall not be paid within ten (or commence10) during days after the six-month period immediately date that is six months following the ExecutiveGrantee’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier date of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of ”, or such earlier date upon which such benefit can be provided under Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are 409A without being subject to the Section 409A Penalties such as, for example, upon Grantee’s death. In no event whatsoever shall not the Company or any of its affiliates be paid until liable to the Executive has experienced a “separation from service” within the meaning of Participant or any party for any additional tax, interest or penalties that may be imposed on Participant or any other person by Section 409A or any damages for failing to comply with Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit.
Appears in 1 contract
Sources: Time Based Restricted Stock Unit Grant Agreement (KMG Chemicals Inc)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code Section 409A of 1986, as amended, and the regulations and applicable guidance promulgated thereunder (collectively, “Code Section 409A”) or comply with an exemption from the application of Code Section 409A and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be interpreted construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A.
(b) Neither the Executive nor the Company shall take any action to accelerate or delay the payment of any monies and/or provision of any benefits in any matter which would not be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel Code Section 409A.
(c) A termination of a national reputation with expertise in Section 409A that employment shall not be deemed to have occurred for purposes of any provision of this Agreement (providing for the form or any award timing of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company payment of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing benefits upon or following a termination of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive employment unless such termination is also a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-of Code Section 409A) and, for purposes of any such provision of this Agreement under which (and to the extent) deferred compensation subject to Code Section 409A is paid, references to a “termination” or “termination of employment” or like references shall mean separation from service. If the Executive is deemed on the date of separation from service with the Company to be a “specified employee”, within the meaning of that term under Code Section 409A(a)(2)(B) and using the identification methodology selected by the Company from time to time, or if none, the default methodology, then with regard to any payment or benefit that is required to be delayed in compliance with Code Section 409A(a)(2)(B), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid prior to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day expiration of the seventh six- month following period measured from the date of the Executive’s separation from service or (ii) the 10th business day following date of the Executive’s death. If In the Executive’s termination case of employment hereunder does not constitute a “separation from service” within the meaning of benefits required to be delayed under Code Section 409A, however, the Executive may pay the cost of benefit coverage, and thereby obtain benefits, during such six month delay period and then any amounts payable hereunder on account be reimbursed by the Company thereafter when delayed payments are made pursuant to the next sentence. On the first day of a termination the seventh month following the date of the Executive’s employment and which are subject separation from service or, if earlier, on the date of the Executive’s death, all payments delayed pursuant to this Section 409A 8(c) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein lump sum, and any remaining payments and benefits due under this Agreement shall be payable paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(d) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of expenses or in-kind benefits subject to Code Section 409A, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall is not be subject to liquidation or exchanged exchange for another benefit, and (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect. All reimbursements shall be reimbursed in accordance with the Company’s reimbursement policies but in no event later than the calendar year following the calendar year in which the related expense is incurred.
(e) If under this Agreement, an amount is to be paid in two or more installments, for purposes of Code Section 409A, each installment shall be treated as a separate payment.
(f) When, if ever, a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within ten (10) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
(g) Notwithstanding any of the provisions of this Agreement, the Company shall not be liable to the Executive if any payment or benefit which is to be provided pursuant to this Agreement and which is considered deferred compensation subject to Code Section 409A otherwise fails to comply with, or be exempt from, the requirements of Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder of 1986, as amended (collectively, “Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409A) to possible in a manner consistent with the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company foregoing statement of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.intent.
(ii) Notwithstanding any other provision of anything in this Agreement or elsewhere to the contrary, for purposes of determining the payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A of the Code that become payable under this Agreement in connection with a termination of employment, the date that the Employee is deemed to have incurred a termination of employment shall be the date on which the Employee has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or in subsequent IRS guidance under Code section 409A.
(iii) Notwithstanding anything in this Agreement or elsewhere to the contrary, if Live Nation reasonably determines that (A) the Executive Employee is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executivedate of the Employee’s “separation from service” (within the meaning of-of Treasury Regulation Section 409A1.409A-1(h), then such payment ) and (B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during in connection with the six-month period immediately following the ExecutiveEmployee’s separation from service except as provided on the scheduled payment dates specified in Sections 8(c) and (d) will subject the immediately following sentence. In Employee to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then Live Nation shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executivedate of the Employee’s separation from service or (ii) or, if earlier, the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the ExecutiveEmployee’s employment death (the “Delayed Payment Date”). In the event that this Section 8(f)(iii) requires any payments to be withheld, such withheld payments shall be accumulated and which are paid in a single lump sum, without interest, on the Delayed Payment Date.
(iv) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A to be made to the Employee within a designated period (e.g., within 30 days after the date of termination) and such period begins and ends in different calendar years, the exact payment date within such range shall, subject to Section 8(f)(iii) above, be determined by Live Nation, in its sole discretion, and the Employee shall have no right to designate the year in which the payment shall be made.
(v) Live Nation and the Employee may agree to take other actions to avoid the imposition of a Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Tax at such time and in such manner as permitted under Section 409A.
(iiivi) All expenses Notwithstanding anything herein to the contrary, the Employee expressly agrees and acknowledges that in the event that any Section 409A Tax is imposed in respect of any compensation or other reimbursements as provided herein benefits payable to the Employee, whether under this Agreement or otherwise, then (A) the payment of such Section 409A Tax shall be payable in accordance with solely the CompanyEmployee’s policies in effect from time to timeresponsibility, but in (B) neither Live Nation, its affiliated entities nor any event of their respective past or present directors, officers, employees or agents shall be made on or prior have any liability for any such Section 409A Tax, and (C) the Employee shall indemnify and hold harmless, to the last day greatest extent permitted under law, each of the taxable year following the taxable year foregoing from and against any claims or liabilities that may arise in which respect of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitSection 409A Tax.”
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 25 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
(d) For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 7 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2-1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2-1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in-kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or the provision of any in-kind benefits shall not benefit be subject to liquidation or exchanged exchange for another benefit.
(d) The provisions of this Section 7 shall also apply to all payments and benefits that may be provided under the Change in Control Agreement, notwithstanding any provision to the contrary contained therein, if required in order to comply with Section 409A. In addition to the provisions set forth in subsections (a) through (c) above: (i) the cash severance payable under the Change in Control Agreement shall be paid at the same time and in the same form provided under this Agreement for severance payable under Section 5(b) (that is, in installments over twenty-four (24) months rather than a lump sum) unless the Executive’s separation from service occurs within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5); (ii) if the Executive’s separation from service does occur within twelve (12) months following the effective date of the closing of the Change in Control and the Change in Control qualifies as a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5), then the cash severance payable to the Executive under Section 1(b)(1) of the Change in Control Agreement shall be paid on the sixtieth (60th) day following his separation from service (subject to Section 7(b)) provided the Executive has fulfilled the conditions for payment of the cash severance under the Change in Control Agreement (including that the Release of Claims as defined therein shall have become effective) on or before such date (and shall not be paid otherwise); and (iii) any reimbursement of taxes required to be made by the Company under the Change in Control Agreement shall be made by the end of the calendar year next following the calendar year in which the Executive remits the related taxes. If the payment of cash severance has commenced pursuant to Section 5(b)(1) of this Agreement before the occurrence of a Change in Control that results in the Executive’s eligibility for severance benefits under the Change in Control Agreement, then the payment of cash severance shall be governed by the Change in Control Agreement rather than Section 5(b)(1) of this Agreement, and any adjustment to reflect an underpayment or overpayment of the amount that otherwise would have been due before the Change in Control pursuant to the Change in Control Agreement shall be applied to the first installment due after the Change in Control Agreement, proceeding in chronological order thereafter as necessary.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement comply with or are intended to be exempt from the definition of “nonqualified deferred compensation” under Section 409A of the Internal Revenue Code in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and 409A. In this regard, each payment under this Agreement, including without limitation, each payment other than a life annuity (within the regulations and guidance promulgated thereunder meaning of Treasury Regulation Section 1.409A-2(b)(2)(ii)) in a series of scheduled installments (collectivelywithin the meaning of Treasury Regulation Section 1.409A-2(b)(2)(iii)), “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent that such modification or amendment would (a) increase possible in a manner consistent with the Company’s obligations hereunder, foregoing statement of intent.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is you are a “specified employee” as determined by the Company’s Compensation Committee on the date of termination of employment within the meaning of Code Section 409A, and the Company reasonably determines that any amount or other benefit payable under this Agreement, including Transition Period compensation and benefits, on account of your termination of employment constitutes nonqualified deferred compensation that will subject you to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the Agreement, then the payment or benefit provided for in this Agreement would provision thereof shall be subject postponed to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or date of termination or, if earlier, the date of your death (ii) the 10th business day following “Delayed Payment Date”). You and the Executive’s deathCompany may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 4 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date. If In addition, the Executive’s provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that you have a “separation from service” within with the meaning Company as defined for purposes of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Code Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then EXECUTION VERSION with regard to any payment that is considered non-qualified deferred compensation under Code Section 409A (and not otherwise exempt under Code Section 409A, then any amounts ) payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 25 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
(d) For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Sources: Employment Agreement
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A specificity as to the reason therefore) that Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company and the Executive agree to work in good faith to shall, after consulting with Executive, reform such provision (to the extent permitted under attempt to comply with Code Section 409A) 409A through good-faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company and Executive of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A or damages for failing to comply with Code Section 409A. A termination of employment shall not (i) be obligated deemed to modify or amend this Agreement in have occurred for purposes of any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A, then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such Payment or benefit shall be made or provided at the meaning date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of your “separation from service”, and (ii) the date of Executive’s death, to the extent required under Code Section 409A.
409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 23 (iiiwhether they would have otherwise been payable in a single sum or in installments in the absence of such delay) All shall be paid or reimbursed to Executive in a lump sum with interest at the prime rate as published in The Wall Street Journal on the first business day following the date of the “separation from service”, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (x) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionyou, no such reimbursement or expenses eligible for reimbursement in (y) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (z) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. For purposes of Code Section 409A, Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with Section 409A of the Code and applicable guidance issued thereunder ("Code Section 409A") or be exempt comply with an exemption from Internal Revenue the application of Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be interpreted construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A.
(b) A termination of employment shall not be deemed to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel have occurred for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (providing for the form or timing of payment of any award of compensation, including equity compensation amounts or benefits) would cause Executive benefits that are subject to incur any additional tax or interest under Code Section 409A and that are paid upon or following a termination of employment unless such termination is also a "separation from service" (with specificity as to within the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under meaning of Code Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that and, for purposes of any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement under which (and to the contraryextent) deferred compensation subject to Code Section 409A is paid, references to a "termination" or "termination of employment" or "resign" or "resignation" or like references shall mean separation from service. A separation from service shall not occur under Code Section 409A unless Employee has completely severed his employment or contractor relationship with the Corporation or Employee has permanently decreased his services (via his employment relationship or his consulting relationship) to twenty percent (20%) or less of the average level of bona fide services over the immediately preceding thirty six (36)-month period (or the full period if Employee has been providing services for less than thirty six (36) months). A leave of absence shall only trigger a termination of employment that constitutes a separation from service at the Executive time required under Code Section 409A. If Employee is deemed on the date of separation from service with the Corporation to be a “"specified employee” ", within the meaning of that term under Code Section 409A409A(a)(2)(B) and using the identification methodology selected by the Corporation from time to time, and a or if none, the default methodology, then with regard to any payment or benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Code Section 409A if 409A(a)(2)(B), such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid prior to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day expiration of the seventh month following six(6)-month period measured from the Executive’s date of Employee's separation from service or (ii) the 10th business day following the Executive’s date of Employee's death. If In the Executive’s termination case of employment hereunder does not constitute a “separation from service” within the meaning of benefits that are subject to Code Section 409A, however, Employee may pay the cost of benefit coverage, and thereby obtain benefits, during such six (6) month delay period and then any amounts payable hereunder on account of a termination be reimbursed by the Corporation thereafter when delayed payments are made pursuant to the next sentence. On the first day of the Executive’s employment and which are subject seventh (7th) month following the date of Employee's separation from service or, if earlier, on the date of Employee's death, all payments delayed pursuant to this Section 409A 15(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until the Executive has experienced or reimbursed to Employee in a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein lump sum, with interest, and any remaining payments and benefits due under this Agreement shall be payable paid or provided in accordance with the Company’s policies normal payment dates specified for them herein. The amount of interest paid shall be based on the prime rate of interest in effect from time to time, but in any event shall be made on or prior to the last first day of the taxable year month following Employee's separation from service as reported in the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitWall Street Journal.
Appears in 1 contract
Sources: Employment Agreement (Eastern Virginia Bankshares Inc)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made on the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (B) the date of Executive’s death, to the extent required under Code Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Companynormal payment dates specified for them herein.
(c) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following the date of Executive’s policies termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in effect from time the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to timebe provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, but in then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any event payment made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payment made thereafter shall continue as provided herein.
(d) To the extent that any expense reimbursement or in-kind benefit under this Agreement constitutes “non-qualified deferred compensation” for purposes of Code Section 409A, (i) such expense or other reimbursement hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (ii) any right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit, and (iii) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, Executive’s right to receive installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of Employer.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Unless this Agreement provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or exchanged other compensation is to be paid for another benefita specified continuing period of time beyond the date of Executive’s termination of employment in accordance with Employer’s payroll practices (or other similar term), the payments of such base salary or other compensation shall be made upon such schedule as in effect upon the date of termination, but no less frequently than monthly.
(h) Any annual bonus payable to Executive in accordance with the provisions of Section 3(b) hereof shall be paid in the calendar year following the calendar year to which such bonus relates at the same time bonuses are paid to other senior executive officers of Employer generally.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties This Performance Award Agreement is that payments and benefit under this Agreement intended to comply with or be exempt from Internal Revenue the requirements of Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, any right or benefit which is provided pursuant to the maximum extent permitted, or in connection with this Performance Award Agreement shall be interpreted which is considered to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity nonqualified deferred compensation or benefits) would cause Executive subject to incur any additional tax or interest under Code Section 409A (referred to as a “409A Award”) shall be provided and paid in a manner, and at such time and in such form, as complies with specificity the applicable requirements of Code Section 409A to avoid the unfavorable tax consequences provided therein for non-compliance. Consequently, this Performance Award Agreement is intended to be administered, interpreted and construed in accordance with the applicable requirements of Code Section 409A. Notwithstanding the foregoing, the Executive and his or her successor in interest shall be solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on the Executive or his or her successor in interest in connection with this Performance Award Agreement (including any taxes and penalties under Code Section 409A); and neither the Company nor any of its affiliates shall have any obligation to indemnify or otherwise hold the Executive or his or her successor in interest harmless from any or all of such taxes or penalties.
(i) Except as permitted under Code Section 409A, any 409A Award payable to the reason therefore) Executive or for his or her benefit with respect to the Performance Award may not be reduced by, or offset against, any amount owing by the Executive to the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision or any of its affiliates.
(to the extent permitted under Section 409Aii) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that entitlement to payment of any provision hereof is modified in order 409A Award occurs due to comply with termination or be exempt from Section 409Acessation of employment, such modification termination or cessation of employment shall be made in good faith and shall, read to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute mean a “separation from service” within the meaning of Code Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a 409A. A “separation from service” shall occur where it is reasonably anticipated that no further services will be performed after that date or that the level of bona fide services the Executive will perform after that date (whether as an employee or independent contractor of the Company or an affiliate) will permanently decrease to less than twenty percent (20%) of the average level of bona fide services performed over the immediately preceding thirty-six (36) month period. Continued services solely as a director of the Company or an affiliate shall not prevent a separation from service from occurring by the Executive as permitted by Code Section 409A. Where entitlement to payment occurs by reason of a separation from service and the Executive is a “specified employee” (within the meaning of Code Section 409A.409A, as applicable to the Company and its affiliates and using the identification methodology selected by the Company from time to time in accordance with Code Section 409A) on the date of his or her “separation from service”, then payment of such 409A Award shall be delayed (without interest) until the first business day after the end of the six (6) month delay period required under Code Section 409A or, if earlier, after the Executive’s death.
(iii) All expenses or other reimbursements In the event a 409A benefit is payable over a period of time (such as provided herein within ninety (90) days following termination), the date of payment shall be payable determined by the Company in accordance its sole discretion. Additionally, for purposes of complying with the Company’s policies in effect from time to timerequirements under Code Section 409A, but in any event the PSUs and the dividend equivalents shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefittreated as separate payments.
Appears in 1 contract
Code Section 409A Compliance. (iA) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If Any payments that qualify for the Executive provides short-term deferral exception, the separation pay exception or another exception under Code Section 409A shall be paid under the applicable exception to the maximum extent permitted. Each payment of compensation under this Agreement shall be treated as a separate payment of compensation for all purposes under Code Section 409A. In the event that the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines reasonably and in Section 409A good faith that there is any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would that could cause the Executive to incur any be subject to additional tax tax, interest or interest penalties under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from provisions of Code Section 409A, such modification provision shall be made interpreted and resolved in the manner the Company reasonably and in good faith and shall▇▇▇▇▇ ▇▇▇▇▇ necessary to prevent the application of such taxes, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and interest or penalties under Code Section 409A. In no event whatsoever shall the Company of be liable for any additional tax, interest or penalty that may be imposed on the applicable provision without violating the provisions of Executive by Code Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iiB) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service”, such payment or benefit shall not be made or provided until the date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” within of the meaning Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiiC) All To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute “deferred compensation” under Code Section 409A unless such release is signed and delivered, and the period for revocation has expired, within sixty (60) days following the date of the Executive’s termination of employment. In this regard, the Company agrees to provide the Executive with the form of release required under Section 5(K) no later than 5 days after the Executive’s termination date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Code Section 409A, then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(D) With respect to reimbursements or other in-kind benefits under this Agreement, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(E) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be, to the extent permitted under Code Section 409A, within the sole discretion of the Company.
(F) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from Internal Revenue Code Section the definition of “nonqualified deferred compensation” under section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”), in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409Apossible in a manner consistent with the foregoing statement of intent.
(b) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein in this Agreement or elsewhere to the contrary, for purposes of determining the Company shall not (i) be obligated to modify or amend payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A that become payable under this Agreement in any manner to connection with a termination of employment, the extent that such modification Termination Date shall be the date on which the Executive has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or in subsequent IRS guidance under Code section 409A.
(c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executive’s “separation from service” Termination Date and (within the meaning of-Section 409A), then such payment B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided service, including without limitation, payment of any of the payments on the scheduled payment dates specified in Section 2, will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment Termination Date or, if earlier, the date of the Executive’s death (the “Delayed Payment Date”). In the event that this Section 8(c) requires any payments to be withheld, such withheld payments shall be accumulated and which are subject to paid in a single lump sum, with interest at the applicable federal rate provided in section 7872(f)(2) of the Code, on the Delayed Payment Date.
(d) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A shall not to be paid until made to the Executive has experienced within a “separation from service” designated period (e.g., within 30 days after the meaning of Section 409A.
(iiiTermination Date) All expenses or other reimbursements as provided herein and such period begins and ends in different calendar years, the exact payment date within such range shall be payable in accordance with determined by the Company’s policies , in effect from time its sole discretion, and the Executive shall have no right to time, but in any event shall be made on or prior to designate the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year the payment shall in any way affect the expenses eligible for reimbursement in any other taxable year be made.
(e) The Company and the Executive’s right Executive may agree to reimbursement take other actions to avoid the imposition of a Section 409A Tax at such time and in such manner as permitted under Section 409A.”
2. The Employment Agreement is and shall continue in full force and effect, except as amended by this Amendment.
3. Any and all capitalized terms which are not explicitly defined herein shall have the meaning ascribed to them in the Employment Agreement.
4. This Amendment may be signed in counterpart originals, which collectively shall have the same legal effect as if all signature appeared on the same physical document. This Amendment may be signed and exchanged by electronic or in-kind benefits shall not be subject to liquidation or exchanged for another benefitfacsimile transmission, with the same legal effect as if the signatures had appeared in original handwriting on the same physical document.
Appears in 1 contract
Sources: Employment Agreement (Incyte Corp)
Code Section 409A Compliance. A. This Plan shall be interpreted by the Committee to comply with Code Section 409A. Notwithstanding anything herein to the contrary, (i) if at the time of Participant’s Termination of Employment Participant is a “specified employee” as defined in Code Section 409A and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such Termination of Employment is necessary in order to prevent any accelerated or additional tax under Code Section 409A, then the Employer will defer the commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to Participant) until the date that is six months following Participant’s Termination of Employment (or the earliest date as is permitted under Code Section 409A) and (ii) if any other payments of money or other benefits due to Participant hereunder could cause the application of an accelerated or additional tax under Code Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Code Section 409A, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined by the Board of Directors, that does not cause such an accelerated or additional tax.
B. The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectivelysuch that taxation under Code Section 409A shall not arise in connection with this Agreement, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted so as to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning C. For purposes of Section 409A, and a each installment payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein Plan shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefittreated as a separate payment.
Appears in 1 contract
Sources: Supplemental Executive Retirement Plan (Georgia-Carolina Bancshares, Inc)
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of anything set forth in this Agreement to the contrary, any payments and benefits provided pursuant to this Agreement which constitute “deferred compensation” within the meaning of the Treasury Regulations issued pursuant to Section 409A shall not commence until Executive has incurred a “separation from service” (as such term is defined in the Treasury Regulation Section 1.409A-1(h) (“Separation From Service”), unless the Company reasonably determines that such amounts may be provided to Executive without causing Executive to incur the additional 20% tax under Section 409A.
(b) For the avoidance of doubt, it is intended that the payments and benefits set forth in this Agreement satisfy, to the greatest extent possible, the exemptions from the application of Section 409A provided under Treasury Regulation Sections 1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9) and this Agreement will be construed to the greatest extent possible as consistent with those provisions. To the extent not so exempt, this Agreement (and any definitions hereunder) will be construed in a manner that complies with Section 409A and incorporates by reference all required definitions and payment terms. For purposes of Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A 2(b)(2)(iii)), Executive’s right to receive any installment payments under this Agreement (whether severance payments, reimbursements or otherwise) shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment. Notwithstanding any provision to the contrary in this Agreement, if the Company (or, if applicable, the successor entity thereto) determines that any payments upon Executive’s Separation From Service set forth herein and/or under any other agreement with the Company constitute “deferred compensation” under Section 409A and Executive is, on Executive’s Separation From Service, a “specified employee” of the Company or any successor entity thereto, as such term is defined in Section 409A(a)(2)(B)(i) of the Code, then, solely, to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A, the timing of the payments upon Executive’s Separation From Service shall be delayed until the earlier to occur of: (a) the date that is six months and one day after Executive’s Separation From Service or (b) the date of Executive’s death (such applicable date, the “Specified Employee Initial Payment Date”). On the Specified Employee Initial Payment Date, the Company (or the successor entity thereto, as applicable) shall (A) pay to Executive a lump sum amount equal to the sum of the payments upon Executive’s Separation From Service that Executive would otherwise have received through the Specified Employee Initial Payment Date if the commencement of the payment of the severance benefits had not been so delayed pursuant to this Section 9(b), and (B) commence paying the balance of the severance benefits in accordance with the applicable payment schedules set forth in this Agreement.
(c) None of the Severance Benefits under this Agreement will commence or otherwise be delivered prior to the effective date of the Release. Except to the minimum extent that payments must be delayed because Executive is a “specified employee” within (as described above) or until the meaning effectiveness of Section 409Athe Release, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not all amounts will be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements soon as provided herein shall be payable practicable in accordance with the Company’s policies in effect from time to time, but in normal payroll practices and no interest will be due on any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitamounts so deferred.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from Internal Revenue Code Section the definition of “nonqualified deferred compensation” under section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”), in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409Apossible in a manner consistent with the foregoing statement of intent.
(b) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein in this Agreement or elsewhere to the contrary, for purposes of determining the Company shall not (i) be obligated to modify or amend payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A that become payable under this Agreement in any manner to connection with a termination of employment, the extent that such modification Termination Date shall be the date on which the Executive has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or in subsequent IRS guidance under Code section 409A.
(c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executive’s “separation from service” Termination Date and (within the meaning of-Section 409A), then such payment B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided service, including without limitation, payment of any of the payments on the scheduled payment dates specified in Section 2, will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment Termination Date or, if earlier, the date of the Executive’s death (the “Delayed Payment Date”). In the event that this Section 8(c) requires any payments to be withheld, such withheld payments shall be accumulated and which are subject to paid in a single lump sum, with interest at the applicable federal rate provided in section 7872(f)(2) of the Code, on the Delayed Payment Date.
(d) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A shall not to be paid until made to the Executive has experienced within a “separation from service” designated period (e.g., within 30 days after the meaning of Section 409A.
(iiiTermination Date) All expenses or other reimbursements as provided herein and such period begins and ends in different calendar years, the exact payment date within such range shall be payable in accordance with determined by the Company’s policies , in effect from time its sole discretion, and the Executive shall have no right to time, but in any event shall be made on or prior to designate the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year the payment shall in any way affect the expenses eligible for reimbursement in any other taxable year be made.
(e) The Company and the Executive’s right Executive may agree to reimbursement or in-kind benefits shall not be subject take other actions to liquidation or exchanged for another benefit.avoid the imposition of a Section 409A Tax at such time and in such manner as permitted under Section 409A.
Appears in 1 contract
Sources: Employment Agreement (Incyte Corp)
Code Section 409A Compliance. A. This Plan shall be interpreted by the Committee to comply with Section 409A. Notwithstanding anything herein to the contrary, (i) if at the time of Participant’s Termination of Employment Participant is a “specified employee” as defined in Section 409A and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such Termination of Employment is necessary in order to prevent any accelerated or additional tax under Section 409A, then the Employer will defer the commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to Participant) until the date that is six months following Participant’s Termination of Employment (or the earliest date as is permitted under Section 409A) and (ii) if any other payments of money or other benefits due to Participant hereunder could cause the application of an accelerated or additional tax under Section 409A, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Section 409A, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined by the Board of Directors, that does not cause such an accelerated or additional tax.
B. The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectivelysuch that taxation under Section 409A shall not arise in connection with this Agreement, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted so as to be in compliance therewith. If with Section 409A. In no event whatsoever shall the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (Company, or any award of compensationother company, including equity compensation bank, person or benefits) would cause Executive to incur other entity be liable for any additional tax tax, interest or interest penalty that may be imposed on Participant or Beneficiary under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that damages or any provision hereof is modified in order other losses for failing to comply with Section 409A or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to applicable tax or other similar law. Neither the contraryCompany nor any of its Affiliates, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service agents, employees, officers, directors or (ii) the 10th business day following the Executive’s death. If the Executive’s termination other representatives of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination one or more of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses foregoing represents, warrants or guarantees any particular or favorable tax or other reimbursements as provided herein result in connection with this Agreement, the Plan, or otherwise. The Participant shall be payable in accordance with the Company’s policies in effect from time to time, but in solely and exclusively responsible for any event shall be made on or prior to the last day of the taxable year following the taxable year in which and all such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitresults.
Appears in 1 contract
Sources: Supplemental Executive Retirement Plan (Level One Bancorp Inc)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made on the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (B) the date of Executive’s death, to the extent required under Code Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Companynormal payment dates specified for them herein.
(c) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following the date of Executive’s policies termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in effect from time the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to timebe provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, but in then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any event payment made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payment made thereafter shall continue as provided herein.
(d) To the extent that any expense reimbursement or in-kind benefit under this Agreement constitutes “non-qualified deferred compensation” for purposes of Code Section 409A, (i) such expense or other reimbursement hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (ii) any right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit, and (iii) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, Executive’s right to receive installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of Employer.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Unless this Agreement provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or exchanged other compensation is to be paid for another benefita specified continuing period of time beyond the date of Executive’s termination of employment in accordance with Employer’s payroll practices (or other similar term), the payments of such base salary or other compensation shall be made upon such schedule as in effect upon the date of termination, but no less frequently than monthly.
(h) Any annual bonus payable to Executive in accordance with the provisions of Section 3(b) hereof shall be paid in the calendar year following the calendar year to which such bonus relates at the same time bonuses are paid to other senior executive officers of Employer generally. [Remainder of page intentionally left blank] The parties have duly executed this Agreement as of the date first written above. By: ▇▇▇▇▇ ▇. ▇▇▇ By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ Its: CEO Exhibit A is incorporated by reference to Exhibit 10.1 to the Form 8-K (File No. 001-34204), filed February 9, 2010. This AGREEMENT (this “Agreement”) is made as of ____________________, between SeaBright Holdings, Inc., a Delaware corporation and all its subsidiary companies (collectively, the “Company”), and ▇▇▇▇▇ ▇. ▇▇▇ (“Employee”).
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive the Employee and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) Notwithstanding To the extent required for purposes of Code Section 409A, if applicable, a termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Employee is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall not be made or provided until the meaning date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Employee, and (B) the date of the Employee’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 15(b)(ii) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Employee in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iii) All To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (A) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionthe Employee, no such reimbursement or expenses eligible for reimbursement in (B) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (C) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. For purposes of Code Section 409A, the Employee’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
Appears in 1 contract
Sources: Change in Control Severance Agreement (Spectrum Pharmaceuticals Inc)
Code Section 409A Compliance. (i) The It is Company’s intent of the parties is that payments and benefit amounts paid under this Agreement comply with or be exempt from generally shall not constitute “deferred compensation” as that term is defined under Section 409A of the Internal Revenue Code of 1986, as amended (“Code Section 409A 409A”), and the regulations and guidance promulgated thereunder (collectivelythereunder, “Section 409A”) and, accordingly, to because the maximum extent permitted, amounts paid under this Agreement shall be interpreted are structured to be in compliance therewith. If comply with either the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (“short-term deferral” exception or any award of compensation, including equity compensation or benefits) would cause Executive other applicable exceptions to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend individual payments under this Agreement in any manner do not qualify for an exception and are determined to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employeedeferred compensation” within the meaning of Code Section 409A and compliance with an applicable term of this Agreement would cause or would result in a violation of Code Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment provision shall be interpreted or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided reformed in the immediately following sentence. In such an eventmanner necessary to achieve compliance with Code Section 409A. Accordingly, any payments or benefits the “Termination Date” is the date that would otherwise have been made or provided during such six-month period and which would have Employee incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of under Code Section 409A, then any amounts payable hereunder on account of a termination of the Executiveand thus all payments under this Agreement are being made upon Employee’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within . In no event may Employee, directly or indirectly, designate the meaning calendar year of Section 409A.
(iii) All expenses a payment and where payment may occur in one year or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenext, but in any event it shall be made on in the second year. Each payment under this Agreement, including each salary continuation payment of Severance Pay, Bonus Amount, and each Benefits Offset Payment, shall be treated as a separate identified payment for purposes of Code Section 409A. Employee is a specified employee (as defined in Treasury Regulation Section 1.409A-1(i)). Company and Employee agree that all payments under this Agreement that are scheduled to be paid within six months after Employee’s Termination Date qualify for an exception to Code Section 409A, and all other payments are made at a time and in a form that complies with Code Section 409A. Employee acknowledges that Company does not make any representations or prior is providing tax advice to Employee, and that Employee has had the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year opportunity to consult with her own tax and the Executive’s right financial counsel with respect to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitthis Agreement.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Section 409A of the Internal Revenue Code Section 409A of 1986, as amended (the “Code”) and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith; provided, that the Corporation does not guarantee to Employee any particular tax treatment with respect to this Agreement and any payments hereunder. If In no event whatsoever shall the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Corporation be liable for any additional tax, interest, or penalties that may be imposed on Employee by Code Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order damages for failing to comply with or be exempt from Code Section 409A. For purposes of Code Section 409A, such modification Employee’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made in good faith and shallwithin ten calendar days following the date of termination”), to the maximum extent reasonably possible, maintain actual date of payment within the original intent and economic benefit to Executive and specified period shall be within the Company sole discretion of the applicable provision without violating Corporation. In no event may Employee, directly or indirectly, designate the provisions calendar year of Section 409A. Notwithstanding anything contained herein any payment to the contrary, the Company shall not (i) be obligated to modify or amend made under this Agreement in that is considered nonqualified deferred compensation. With regard to any manner to the extent provision herein that such modification provides for reimbursement of costs and expenses or amendment would (a) increase the Company’s obligations hereunderin-kind benefits, (b) increase any amounts owed except as permitted by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Code Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year; provided, that this clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect; and (iii) such payments shall be made on or before the last day of Employee’s taxable year following the taxable year in which the expense was incurred.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement set forth in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, any payments and benefits provided pursuant to this Agreement which constitute “deferred compensation” within the meaning of the Treasury Regulations issued pursuant to Section 409A of the Internal Revenue Code (the “Code”) shall not commence until Executive has incurred a “separation from service” (as such term is defined in the Treasury Regulation Section 1.409A-1(h) (“Separation From Service”), unless Company reasonably determines that such amounts may be provided to Executive without causing Executive to incur the additional 20% tax under Section 409A. For the avoidance of doubt, it is intended that the payments and benefits set forth in this Agreement satisfy, to the greatest extent possible, the exemptions from the application of Section 409A provided under Treasury Regulation Sections 1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9) and this Agreement will be construed to the greatest extent possible as consistent with those provisions. To the extent not so exempt, this Agreement (and any definitions hereunder) will be construed in a manner that complies with Section 409A and incorporates by reference all required definitions and payment terms. For purposes of Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A 2(b)(2)(iii)), Executive’s right to receive any installment payments under this Agreement (whether severance payments, 174807636 v5 reimbursements or otherwise) shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment. Notwithstanding any provision to the contrary in this Agreement, if Company (or, if applicable, the successor entity thereto) determines that any payments upon Executive’s Separation From Service set forth herein and/or under any other agreement with Company constitute “deferred compensation” under Section 409A and Executive is, on Executive’s Separation From Service, a “specified employee” of Company or any successor entity thereto, as such term is defined in Section 409A(a)(2)(B)(i) of the Code, then, solely, to the extent necessary to avoid the incurrence of the adverse personal tax consequences under Section 409A, the timing of the payments upon Executive’s Separation From Service shall be delayed until the earlier to occur of: (a) the date that is six months and one day after Executive’s Separation From Service or (b) the date of Executive’s death (such applicable date, the “Specified Employee Initial Payment Date”). On the Specified Employee Initial Payment Date, Company (or the successor entity thereto, as applicable) shall (A) pay to Executive a lump sum amount equal to the sum of the payments upon Executive’s Separation From Service that Executive would otherwise have received through the Specified Employee Initial Payment Date if the commencement of the payment of the severance benefits had not been so delayed pursuant to this section and (B) commence paying the balance of the severance benefits in accordance with the applicable payment schedules set forth in this Agreement. None of the severance benefits under this Agreement will commence or otherwise be delivered prior to the effective date of the Release. Except to the minimum extent that payments must be delayed because Executive is a “specified employee” within (as described above) or until the meaning effectiveness of Section 409Athe Release, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not all amounts will be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements soon as provided herein shall be payable practicable in accordance with the Company’s policies in effect from time to time, but in normal payroll practices and no interest will be due on any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitamounts so deferred.
Appears in 1 contract
Sources: Executive Employment Agreement (Cooper Companies Inc)
Code Section 409A Compliance. (i) The Although the Company does not guarantee the tax treatment of any payment hereunder, the intent of the parties is that payments and benefit under this Agreement are either exempt from or comply with or be exempt from Internal Revenue Code Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance a manner consistent therewith. If In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in by Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order damages for failing to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend contrary in this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contraryAgreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for in this Agreement would be subject to additional tax that is considered deferred compensation under Section 409A if payable on account of a “separation from service,” such payment or benefit shall not be made or provided until the date which is paid within the earlier of (A) the expiration of the six months after (6)-month period measured from the Executive’s date of such “separation from service” of the Executive, and (within B) the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following date of the Executive’s separation from service except as provided death, to the extent required under Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 2(c) (whether they would have otherwise been payable in a single sum or in installments in the immediately following sentence. In absence of such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A delay) shall instead be paid or reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the earlier normal payment dates specified for them herein. In no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning Section 409A be subject to offset by any other amount unless otherwise permitted by Section 409A. For purposes of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits receive any installment payments pursuant to this Agreement shall not be subject treated as a right to liquidation or exchanged for another benefitreceive a series of separate and distinct payments.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted and applied so as to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the The Company and the Executive agree to work together in good faith to reform consider amendments to this Agreement and to take such provision (reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “non-qualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination”, “termination of employment”, or like terms shall mean “separation from service”. If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6)- month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 26(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred. For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the General Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the General Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Sources: Employment Agreement (Amylyx Pharmaceuticals, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and or comply with an exemption from the regulations and guidance promulgated thereunder (collectively, “application of Code Section 409A”) 409A and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be interpreted construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A.
(b) Neither Employee nor the Employer shall take any action to accelerate or delay the payment of any monies and/or provision of any benefits in any matter which would not be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel Code Section 409A.
(c) A termination of a national reputation with expertise in Section 409A that employment shall not be deemed to have occurred for purposes of any provision of this Agreement (providing for the form or timing of payment of any award of compensation, including equity compensation amounts or benefits) would cause Executive benefits that are subject to incur any additional tax or interest under Code Section 409A (with specificity as to the reason therefore) and that are paid upon or the Company independently makes following a termination of employment unless such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof termination is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is also a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-of Code Section 409A) and, for purposes of any such provision of this Agreement under which (and to the extent) deferred compensation subject to Code Section 409A is paid, references to a “termination” or “termination of employment” or like references shall mean separation from service. If Employee is deemed on the date of separation from service with the Employer to be a “specified employee”, within the meaning of that term under Code Section 409A(a)(2)(B) and using the identification methodology selected by the Employer from time to time, or if none, the default methodology, then with regard to any payment or benefit that is required to be delayed in compliance with Code Section 409A(a)(2)(B), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid prior to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day expiration of the seventh six-month following period measured from the Executivedate of Employee’s separation from service or (ii) the 10th business day following the Executivedate of Employee’s death. If In the Executivecase of benefits, however, Employee may pay the cost of benefit coverage, and thereby obtain benefits, during such six month delay period and then be reimbursed by the Employer thereafter when delayed payments are made pursuant to the next sentence. On the first day of the seventh month following the date of Employee’s termination of employment hereunder does not constitute a “separation from service” within service or, if earlier, on the meaning date of Employee’s death, all payments delayed pursuant to this Section 409A, then any amounts 21 (whether they would have otherwise been payable hereunder on account in a single sum or in installments in the absence of a termination of the Executive’s employment and which are subject to Section 409A such delay) shall not be paid until the Executive has experienced or reimbursed to Employee in a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein lump sum, and any remaining payments and benefits due under this Agreement shall be payable paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(d) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of expenses or in-kind benefits that are subject to Code Section 409A, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall is not be subject to liquidation or exchanged exchange for another benefit, and (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect. All reimbursements shall be reimbursed in accordance with the Employer’s reimbursement policies but in no event later than the calendar year following the calendar year in which the related expense is incurred.
(e) If under this Agreement, an amount is to be paid in two or more installments, for purposes of Code Section 409A, each installment shall be treated as a separate payment.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted and applied so as to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the The Company and the Executive agree to work together in good faith to reform consider amendments to this Agreement and to take such provision (reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “non-qualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination”, “termination of employment”, or like terms shall mean “separation from service”. If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6) month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 26(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A: (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred. For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the General Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the General Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Sources: Employment Agreement (Amylyx Pharmaceuticals, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in by Code Section 409A or any damages for failing to comply with Code Section 409A, except those that are caused solely by the Company’s willful actions or inactions that were not consented to or approved by the Executive.
(b) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award providing for the payment of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “non-qualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event benefit shall be made on or prior to provided at the last day date which is the earlier of (A) the expiration of the taxable year following six (6)-month period measured from the taxable year in which date of such expenses were incurred by “separation from service” of the Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect and (B) the expenses eligible for reimbursement in any other taxable year and date of the Executive’s right death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to reimbursement this Section (whether they would have otherwise been payable in a single sum or in-kind in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum and any remaining payments and benefits shall not be subject to liquidation or exchanged for another benefit.due under
Appears in 1 contract
Sources: Employment Agreement (Comtech Telecommunications Corp /De/)
Code Section 409A Compliance. (i) The 8.1 It is the Company’s intent of the parties is that payments compensation and benefit benefits to which you are entitled under this Agreement comply with or not be exempt from treated as “nonqualified deferred compensation” under Section 409A of the Internal Revenue Code Section 409A of 1986, as amended, and the treasury regulations and other official guidance promulgated thereunder (collectively, “Code Section 409A”) and), accordingly, to and that any ambiguities in the maximum extent permitted, construction of this Agreement shall be interpreted in order to be in compliance therewitheffectuate such intent. If In the Executive provides event that the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines, in its sole discretion, that any compensation or benefits to which you are entitled under this Agreement could be treated as “nonqualified deferred compensation” under Code Section 409A that unless this Agreement is amended or modified, the Company may, in its sole discretion, amend or modify this Agreement without obtaining any additional consent from you, so long as such amendment or modification does not materially affect the net present value of the compensation or benefits to which you otherwise would be entitled under this Agreement.
8.2 A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award providing for the payment of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If you are deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall be made or provided at the meaning date which is the earlier of (a) the expiration of the six (6)-month period measured from the date of your “separation from service,” and (b) the date of your death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 409A.(whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to you in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
8.3 If a general release of claims, as contemplated under Section 7 hereof, is executed and delivered (and no longer subject to revocation) in the manner provided in said Section 7, then the following shall apply:
(iiia) All To the extent that the Severance Pay is not “nonqualified deferred compensation” for purposes of Code Section 409A, then the Severance Pay shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon your termination of employment, and any payments made thereafter shall continue as provided herein.
(b) To the extent that the Severance Pay is “nonqualified deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following your termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon your termination of employment, and any payments made thereafter shall continue as provided herein.
8.4 For purposes of compliance with Code Section 409A, (a) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionyou, (b) any right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit, and (c) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
8.5 For purposes of Code Section 409A, your right to receive any installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments.
8.6 In no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
8.7 In no event whatsoever shall the Company be liable for any additional tax, interest or exchanged penalty that may be imposed on you by Code Section 409A or damages for another benefit.failing to comply with Code Section 409A.
Appears in 1 contract
Sources: Letter Agreement of Employment (New York & Company, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Internal Revenue Code (“Code”) Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel specificity as to the reason therefore) that Executive believes that as a result of a national reputation with expertise in Section 409A that subsequent published guidance issued by the I.R.S. upon which taxpayers generally rely, any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company independently makes such determination, the Company and the Executive agree to work in good faith to shall, after consulting with Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company and is tax neutral to the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of Executive, and (B) thirty (30) days from the date of Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum without interest on the first business day following the Delay Period, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred. Any tax gross-up payment as provided for in this Agreement shall be made in any event no later than the end of the calendar year immediately following the calendar year in which Executive remits the related taxes, and any reimbursement of expenses incurred due to a tax audit or litigation shall be made no later than the end of the calendar year immediately following the calendar year in which the taxes that are the subject of the audit or litigation are remitted to the taxing authority, or, if no taxes are to be remitted, the end of the calendar year following the calendar year in which the audit or litigation is completed.
(d) For purposes of Code Section 409A, Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “within sixty (60) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
Appears in 1 contract
Sources: Employment Agreement (Aerojet Rocketdyne Holdings, Inc.)
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from Internal Revenue the definition of “nonqualified deferred compensation” under section 409A of the Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409Apossible in a manner consistent with the foregoing statement of intent.
(b) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein in this Agreement or elsewhere to the contrary, for purposes of determining the Company shall not (i) be obligated to modify or amend payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A of the Code that become payable under this Agreement in any manner to connection with a termination of employment, the extent that such modification Date of Termination shall be the date on which the Executive has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or in subsequent IRS guidance under Code section 409A.
(c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executive’s “separation from service” Date of Termination and (within the meaning of-Section 409A), then such payment B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided service, including without limitation, payment of any of the payments on the scheduled payment dates specified in Section 3, will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment Date of Termination or, if earlier, the date of the Executive’s death (the “Delayed Payment Date”). In the event that this Section 10(c) requires any payments to be withheld, such withheld payments shall be accumulated and which are subject to paid in a single lump sum, with interest at the applicable federal rate provided in section 7872(f)(2) of the Code, on the Delayed Payment Date.
(d) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A shall not to be paid until made to the Executive has experienced within a “separation from service” designated period (e.g., within 30 days after the meaning Date of Section 409A.
(iiiTermination) All expenses or other reimbursements as provided herein and such period begins and ends in different calendar years, the exact payment date within such range shall be payable in accordance with determined by the Company’s policies , in effect from time its sole discretion, and the Executive shall have no right to time, but in any event shall be made on or prior to designate the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year the payment shall in any way affect the expenses eligible for reimbursement in any other taxable year be made.
(e) The Company and the Executive’s right Executive may agree to reimbursement or in-kind benefits shall not be subject take other actions to liquidation or exchanged for another benefit.avoid the imposition of a Section 409A Tax at such time and in such manner as permitted under Section 409A.
Appears in 1 contract
Sources: Employment Agreement (Incyte Corp)
Code Section 409A Compliance. (i) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder of 1986, as amended (collectively, “Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409A) to possible in a manner consistent with the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company foregoing statement of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.intent.
(ii) Notwithstanding any other provision of anything in this Agreement or elsewhere to the contrary, for purposes of determining the payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A of the Code that become payable under this Agreement in connection with a termination of employment, the date that the Executive is deemed to have incurred a termination of employment shall be the date on which the Executive has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or in subsequent IRS guidance under Code section 409A.
(iii) Notwithstanding anything in this Agreement or elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the date of the Executive’s “separation from service” (within the meaning of-of Treasury Regulation Section 409A1.409A-1(h), then such payment ) and (B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided on the scheduled payment dates specified in Sections 8(a) through (c), will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the date of the Executive’s separation from service or (ii) or, if earlier, the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment death (the “Delayed Payment Date”). In the event that this Section 8(e)(iii) requires any payments to be withheld, such withheld payments shall be accumulated and which are paid in a single lump sum, without interest, on the Delayed Payment Date.
(iv) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A to be made to the Executive within a designated period (e.g., within 30 days after the date of termination) and such period begins and ends in different calendar years, the exact payment date within such range shall, subject to Section 409A shall not 8(e)(iii) above, be paid until determined by the Company, in its sole discretion, and the Executive has experienced shall have no right to designate the year in which the payment shall be made.
(v) The Company and the Executive may agree to take other actions to avoid the imposition of a “separation from service” within the meaning of Section 409A Tax at such time and in such manner as permitted under Section 409A.
(iiivi) All expenses Notwithstanding anything herein to the contrary, the Executive expressly agrees and acknowledges that in the event that any Section 409A Tax is imposed in respect of any compensation or other reimbursements as provided herein benefits payable to the Executive, whether under this Agreement or otherwise, then (A) the payment of such Section 409A Tax shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and solely the Executive’s right responsibility, (B) neither the Company, its affiliated entities nor any of their respective past or present directors, officers, employees or agents shall have any liability for any such Section 409A Tax, and (C) the Executive shall indemnify and hold harmless, to reimbursement the greatest extent permitted under law, each of the foregoing from and against any claims or in-kind benefits shall not be subject to liquidation or exchanged for another benefitliabilities that may arise in respect of any such Section 409A Tax.”
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code Section 409A of 1986, as amended, and the regulations and applicable guidance promulgated thereunder (collectively, “Code Section 409A”) or comply with an exemption from the application of Code Section 409A and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be interpreted construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A.
(b) Neither the Executive nor the Company shall take any action to accelerate or delay the payment of any monies and/or provision of any benefits in any matter which would not be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel Code Section 409A.
(c) A termination of a national reputation with expertise in Section 409A that employment shall not be deemed to have occurred for purposes of any provision of this Agreement (providing for the form or any award timing of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company payment of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing benefits upon or following a termination of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive employment unless such termination is also a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-of Code Section 409A) and, for purposes of any such provision of this Agreement under which (and to the extent) deferred compensation subject to Code Section 409A is paid, references to a “termination” or “termination of employment” or like references shall mean separation from service. If the Executive is deemed on the date of separation from service with the Company to be a “specified employee”, within the meaning of that term under Code Section 409A(a)(2)(B) and using the identification methodology selected by the Company from time to time, or if none, the default methodology, then with regard to any payment or benefit that is required to be delayed in compliance with Code Section 409A(a)(2)(B), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid prior to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day expiration of the seventh six- month following period measured from the date of the Executive’s separation from service or (ii) the 10th business day following date of the Executive’s death. If In the Executive’s termination case of employment hereunder does not constitute a “separation from service” within the meaning of benefits required to be delayed under Code Section 409A, however, the Executive may pay the cost of benefit coverage, and thereby obtain benefits, during such six month delay period and then any amounts payable hereunder on account be reimbursed by the Company thereafter when delayed payments are made pursuant to the next sentence. On the first day of a termination the seventh month following the date of the Executive’s employment and which are subject separation from service or, if earlier, on the date of the Executive’s death, all payments delayed pursuant to this Section 409A 8(c) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein lump sum, and any remaining payments and benefits due under this Agreement shall be payable paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(d) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of expenses or in-kind benefits subject to Code Section 409A, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall is not be subject to liquidation or exchanged exchange for another benefit, and (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect. All reimbursements shall be reimbursed in accordance with the Company’s reimbursement policies but in no event later than the calendar year following the calendar year in which the related expense is incurred.
(e) If under this Agreement, an amount is to be paid in two or more installments, for purposes of Code Section 409A, each installment shall be treated as a separate payment.
(f) When, if ever, a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within ten (10) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.”
(g) Notwithstanding any of the provisions of this Agreement, the Company shall not be liable to the Executive if any payment or benefit which is to be provided pursuant to this Agreement and which is considered deferred compensation subject to Code Section 409A otherwise fails to comply with, or be exempt from, the requirements of Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and or comply with an exemption from the regulations and guidance promulgated thereunder (collectively, “application of Code Section 409A”) 409A and, accordingly, to the maximum extent permitted, all provisions of this Agreement shall be interpreted construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A.
(b) Neither the Executive nor the Company shall take any action to accelerate or delay the payment of any monies and/or provision of any benefits in any matter which would not be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Code Section 409A that (including any transition or grandfather rules thereunder).
(c) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (providing for the form or any award timing of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company payment of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing benefits upon or following a termination of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive employment unless such termination is also a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-of Code Section 409A) and, for purposes of any such provision of this Agreement under which (and to the extent) deferred compensation subject to Code Section 409A is paid, references to a “termination” or “termination of employment” or like references shall mean separation from service. If the Executive is deemed on the date of separation from service with the Company to be a “specified employee”, within the meaning of that term under Code Section 409A(a)(2)(B) and using the identification methodology selected by the Company from time to time, or if none, the default methodology, then with regard to any payment or benefit that is required to be delayed in compliance with Code Section 409A(a)(2)(B), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid prior to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day expiration of the seventh 6-month following period measured from the date of the Executive’s separation from service or (ii) the 10th business day following date of the Executive’s death. If In the Executive’s termination case of employment hereunder does not constitute a “separation from service” within benefits, however, the meaning Executive may pay the cost of Section 409Abenefit coverage, and thereby obtain benefits, during such 6-month delay period and then any amounts payable hereunder on account be reimbursed by the Company thereafter when delayed payments are made pursuant to the next sentence. On the 1st day of a termination the 7th month following the date of the Executive’s employment and which are subject separation from service or, if earlier, on the date of the Executive’s death, all payments delayed pursuant to this Section 409A 7(c) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein lump sum, and any remaining payments and benefits due under this Agreement shall be payable paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(d) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall is not be subject to liquidation or exchanged exchange for another benefit, and (ii) the amount of expenses eligible for reimbursement, or in- kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because such expenses are subject to a limit related to the period the arrangement is in effect. Except as otherwise allowed under Code Section 409A, all reimbursements shall be reimbursed in accordance with the Company’s reimbursement policies but in no event later than the calendar year following the calendar year in which the related expense is incurred.
(e) If under this Agreement, an amount is to be paid in 2 or more installments, for purposes of Code Section 409A, each installment shall be treated as a separate payment.
(f) When, if ever, a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within 10 days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
(g) Notwithstanding any of the provisions of this Agreement, the Company shall not be liable to the Executive if any payment or benefit which is to be provided pursuant to this Agreement and which is considered deferred compensation subject to Code Section 409A otherwise fails to comply with, or be exempt from, the requirements of Code Section 409A.
Appears in 1 contract
Sources: Change in Control Agreement (Pinnacle Bankshares Corp)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to penalty that may be imposed on the extent that such modification Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding An "Employment Separation" shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive payment of any amounts or benefits upon or following an Employment Separation unless such Employment Separation is also a “specified employee” "separation from service" within the meaning of Code Section 409A409A and, and for purposes of any such provision of this Agreement, references to an Employment Separation or like terms shall mean "separation from service." If the Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any payment or the provision of any benefit provided for in this Agreement would be subject to additional tax that is considered deferred compensation under Code Section 409A if payable on account of a "separation from service," such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and at the date which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on is the earlier of (i) the first business day expiration of the seventh month following six (6)-month period measured from the date of such "separation from service" of the Executive’s separation from service or , and (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment 's death (the "Delay Period"). Upon the expiration of the Delay Period, all payments and which are subject benefits delayed pursuant to this Section 409A (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the meaning of Section 409A.normal payment dates specified for them herein.
(iiic) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event under this Agreement shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive (provided that if any such reimbursements constitute taxable income to the Executive. In addition, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for Change in Control & Non-competition Agreement I reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and year.
d) For purposes of Code Section 409A, the Executive’s 's right to reimbursement receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., "payment shall be made within thirty (30) days"), the actual date of payment within the specified period shall be within the sole discretion of the Company.
e) In no event shall any payment under this Agreement that constitutes "deferred compensation" for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitotherwise."
Appears in 1 contract
Sources: Change in Control & Non Competition Agreement (Commercial Vehicle Group, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or will not be exempt from subject to gross income inclusion, additional tax and interest provided for in Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, and this Agreement shall be interpreted to be in compliance therewithaccordingly. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from avoid application of Code Section 409A, such the modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein subjecting any payment hereunder to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment that constitutes “nonqualified deferred compensation” upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or similar terms shall mean “separation from service.”
(c) Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the Date of Termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), i.e., is a key employee (as defined in Code Section 416(i) without regard to paragraph (5) thereof) of a corporation any stock in which is publicly traded on an established securities market or otherwise, then with regard to any amounts payment or the provision of any benefit under this Agreement that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall not be made or provided until the meaning date that is the earlier of (A) the expiration of the six (6)- Executive Employment Agreement Executive Initials:____ month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 4(c)) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest from the original due date, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. If any payment hereunder following termination of employment constitutes nonqualified deferred compensation under Code Section 409A and is contingent on Executive’s execution of a release, if the period for Executive’s review and execution of the release begins and ends in different tax years, then the payment contingent on execution of the Separation Agreement shall be paid to Executive in the later tax year to occur.
(iiid) All To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (A) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which the Executive incurs such expenses were incurred by Executive. In additionexpenses, no such reimbursement or expenses eligible for reimbursement in (B) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (C) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided in any other taxable year.
(e) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment or benefit under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Without in any way limiting the effect of the foregoing provisions of this Section 4:
(i) if Code Section 409A requires that any special terms, provisions or conditions be included in this Agreement, then such terms, provisions and conditions shall, to the extent practicable, be deemed to be made a part of this Agreement; and
(ii) in the event that this Agreement shall be deemed to subject any payment hereunder to application of Code Section 409A, then, to the extent the Board considers it reasonable to do so, the Board and the Executive may attempt to amend the deferred compensation provided for herein, and the provisions of this Agreement related thereto, to avoid application of Code Section 409A, but, in any event, none of the Company, the Board nor its or their designees or agents shall be liable to the Executive or to any other person for actions, decisions or determinations made in good faith. Executive Employment Agreement Executive Initials:____
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides In no event whatsoever shall the Company with documentation from Executive’s tax counsel of a national reputation with expertise in be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A or damages for failing to comply with Code Section 409A.
(b) In the event that any provision of this Agreement (is determined by the Company or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under not comply with Code Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination409A, the Company and the shall fully cooperate with Executive agree to work in good faith to reform this Agreement to correct such provision (noncompliance to the extent permitted under any guidance, procedure, or method promulgated by the Internal Revenue Service now or in the future that provides for such correction as a means to avoid or mitigate any taxes, interest, or penalties that would otherwise be incurred by Executive on account of such noncompliance.
(c) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.”
(d) Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B). then each of the following shall apply:
(i) With regard to any payment that is considered deferred compensation under Code Section 409A payable on account of a “separation from service,” such payment shall be made on the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of Executive, and (B) the date of Executive’s death (the “Delay Period”) to the minimum extent reasonably necessary to conform with required under Code Section 409A. Upon the expiration of the Delay Period, all payments delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid to Executive in a lump sum, and all remaining payments due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein; and
(ii) To the extent that any provision hereof is modified in order benefits to comply with or be provided during the Delay Period are considered deferred compensation under Code Section 409A provided on account of a “separation from service,” and such benefits are not otherwise exempt from Code Section 409A, Executive shall pay the cost of such modification shall be made in good faith and shallbenefits during the Delay Period, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not reimburse Executive (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification costs would otherwise have been paid by the Company or amendment to the extent that such benefits would (aotherwise have been provided by the Company at no cost to Executive) increase the Company’s obligations hereundershare of the cost of such benefits upon expiration of the Delay Period, (b) increase and any amounts owed remaining benefits shall be reimbursed or provided by the Company hereunder in accordance with the procedures specified herein.
(e) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (cand no longer subject to revocation, if applicable) within sixty (60) days following the date of Executive’s termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately after the date the release is executed and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise accelerate would have been due prior to the timing Release Effective Date under the terms of this Agreement applied as though such payments owed commenced immediately upon Executive’s termination of employment. and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following Executive’s termination of employment.
(ii) To the extent any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following Executive’s termination of employment. The Company may provide, in its sole discretion, that Executive may continue to participate in any benefits delayed pursuant to this Section during the period of such delay, provided that Executive shall bear the full cost of such benefits during such delay period. Upon the date such benefits would otherwise commence pursuant to this Section, the Company may reimburse Executive the Company’s share of the cost of such benefits, to the extent that such costs would otherwise have been paid by the Company hereunder or to the extent that such benefits would otherwise have been provided by the Company at no cost to Executive, in each case had such benefits commenced immediately upon Executive’s termination of employment. Any remaining benefits shall be reimbursed or provided by the Company in accordance with the schedule and procedures specified herein.
(iif) be responsible for the failure For purposes of this Agreement to comply with, or be exempt from, Code Section 409A, or for Executive’s right to receive any taxes, penalties or interest incurred by Executive under Section 409A.installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.
(iig) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a in no event shall any payment or benefit provided for in under this Agreement would that constitutes “deferred compensation” for purposes of Code Section 409A be subject to additional tax under offset, counterclaim or recoupment by any other amount payable to Executive unless otherwise permitted by Code Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” 409A.
(within the meaning of-Section 409A), then such payment or benefit required under h) Unless this Agreement shall not provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or other compensation is to be paid (or commence) during for a specified continuing period of time beyond the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier date of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timepayroll practices (or other similar term), but in any event the payments of such base salary or other compensation shall be made on upon such schedule as in effect upon the date of termination, but no less frequently than monthly or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitshorter interval specified herein.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to penalty that may be imposed on the extent that such modification Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding An "Employment Separation" shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive payment of any amounts or benefits upon or following an Employment Separation unless such Employment Separation is also a “specified employee” "separation from service" within the meaning of Code Section 409A409A and, and for purposes of any such provision of this Agreement, references to an Employment Separation or like terms shall mean "separation from service." If the Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any payment or the provision of any benefit provided for in this Agreement would be subject to additional tax that is considered deferred compensation under Code Section 409A if payable on account of a "separation from service," such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and at the date which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on is the earlier of (i) the first business day expiration of the seventh month following six (6)-month period measured from the date of such "separation from service" of the Executive’s separation from service or , and (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment 's death (the "Delay Period"). Upon the expiration of the Delay Period, all payments and which are subject benefits delayed pursuant to this Section 409A (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the meaning of Section 409A.normal payment dates specified for them herein.
(iiic) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event under this Agreement shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive (provided that if any such reimbursements constitute taxable income to the Executive. In addition, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and year.
d) For purposes of Code Section 409A, the Executive’s 's right to reimbursement receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., "payment shall be made within thirty (30) days"), the actual date of payment within the specified period shall be within the sole discretion of the Company.
e) In no event shall any payment under this Agreement that constitutes "deferred compensation" for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitotherwise."
Appears in 1 contract
Sources: Change in Control & Non Competition Agreement (Commercial Vehicle Group, Inc.)
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. a. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Internal Revenue Code (“Code”) Section 409A (with specificity as to the reason therefore) or the Company independently makes such determinationany regulations or Treasury guidance promulgated thereunder, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (provision, to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order possible, to comply with or be exempt from Code Section 409A; provided, that the Company agrees to make only such modification shall be made in good faith changes as are necessary to bring such provisions into compliance with Code Section 409A and shallto maintain, to the maximum extent reasonably possiblepracticable, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) b. Notwithstanding any other provision of this Agreement to the contrarycontrary in this Agreement, if the Executive is deemed on the date of termination of employment to be a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Section 409A if 409A(a)(2)(B) such payment or benefit is paid within shall not be made or provided (subject to the last ME1 16353505v.1 sentence hereof) prior to the earlier of (i) the expiration of the six months after (6)-month period measured from the date of the Executive’s “separation from service” (within the meaning of-as such term is defined in Treasury Regulations issued under Code Section 409A) or (ii) the date of Executive’s death (the “Deferral Period”). Upon the expiration of the Deferral Period, then all payments and benefits deferred pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such payment or benefit required under this Agreement deferral) shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then and any amounts payable hereunder on account of a termination of the Executive’s employment remaining payments and which are subject to Section 409A benefits due under this Agreement shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenormal payment dates specified for them herein. Notwithstanding the foregoing, but in any event shall be made on or prior to the last day extent that the foregoing applies to the provision of any ongoing welfare benefits to the taxable year following Executive that would not be required to be delayed if the taxable year in which premiums therefor were paid by the Executive, the Executive shall pay the full cost of premiums for such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect welfare benefits during the expenses eligible for reimbursement in any other taxable year Deferral Period and the Executive’s right Company shall pay (or cause to reimbursement or in-kind benefits shall not be subject paid) to liquidation or exchanged for another benefitthe Executive an amount equal to the amount of such premiums paid by the Executive during the Deferral Period promptly after its conclusion.
Appears in 1 contract
Sources: Change in Control Severance Agreement (Stewardship Financial Corp)
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with Agreement, and amounts and benefits payable under any other agreements or plans referenced in this Agreement, are intended to be exempt from Internal Revenue Code the definition of “nonqualified deferred compensation” under Section 409A and of the Code in accordance with one or more of the exemptions available under the final Treasury regulations and guidance promulgated thereunder (collectivelyunder Section 409A. In this regard, “each payment under Section 409A”6(b) and, accordingly, to the maximum extent permitted, of this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel deemed a separate payment for purposes of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Code Section 409A. To the extent that any provision hereof such amount or benefit is modified or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in order accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or be exempt from Section 409A, such modification benefits. This Agreement shall be made in good faith interpreted and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner administered to the extent possible in a manner consistent with the foregoing statement of intent, and any ambiguity as to its compliance with Section 409A will be read in such a manner so that such modification or amendment would (a) increase all payments hereunder comply with Section 409A of the Company’s obligations hereunder, Code.
(b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Executive is a “specified employee” within as determined by the meaning Compensation Committee on the date of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-as such terms are defined for purposes of Code Section 409A), then such payment and the Company reasonably determines that any amount or other benefit required payable under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s on account of such separation from service except as constitutes nonqualified deferred compensation that will subject the Executive to “additional tax” under Section 409A(a)(1)(B) of the Code (together with any interest or penalties imposed with respect to, or in connection with, such tax, a “409A Tax”) with respect to the payment of such amount or the provision of such benefit if paid or provided at the time specified in the immediately following sentence. In such an eventAgreement, any payments then the payment or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A provision thereof shall instead be paid postponed to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) date of termination or, if earlier, the 10th business day following date of the Executive’s deathdeath (the “Delayed Payment Date”). If The Executive and the Executive’s Company may agree to take other actions to avoid the imposition of a 409A Tax at such time and in such manner as permitted under Section 409A. In the event that this Section 8 requires a delay of any payment, such payment shall be accumulated and paid in a single lump sum on the Delayed Payment Date, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. In addition, the provisions of this Agreement which require the commencement of payments subject to Section 409A upon a termination of employment hereunder does not constitute shall be interpreted to require that the Executive have a “separation from service” within with the meaning Company as defined for purposes of Code Section 409A409A.
(c) To the extent the Company is required pursuant to this Agreement to reimburse fees or expenses incurred by the Executive, then and such reimbursement is taxable as compensation to the Executive, the Company shall reimburse any amounts payable hereunder on account of a termination such eligible fees or expenses no later than 2 1/2 months after the end of the Executivecalendar year in which the fees or expenses were incurred (or if later, 2 1/2 months after the end of the Company’s employment and taxable year in which are the fees or expenses were incurred), subject to any earlier required deadline for payment otherwise applicable under this Agreement. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following Code, the taxable year in which amount of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement reimbursement, or the provision of any in-kind benefit, in any taxable one calendar year shall in any way not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and the Executive’s in no event shall any right to reimbursement or the provision of any in-kind benefits shall not benefit be subject to liquidation or exchanged exchange for another benefit.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in by Code Section 409A that or damages for failing to comply with Code Section 409A.
(b) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible providing for the failure payment of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service”, such payment or benefit shall not be made or provided until the date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” within of the meaning Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiic) All To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute a “deferral of compensation” under Code Section 409A unless such release is signed and delivered within sixty (60) days following the date of the Executive’s termination of employment. In this regard, the Company agrees to provide the Executive with the form of release required under Section 5(J) no later than five (5) days after the Executive’s termination date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to be provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(d) To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue from, Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel specificity as to the reason therefor) that the Executive believes that as a result of a national reputation with expertise in Section 409A that subsequent published guidance issued by the I.R.S. upon which taxpayers generally rely, any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company independently makes such determination, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company and is tax neutral to the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(13), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (B) thirty (30) days from the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 20 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum with interest at the prime rate as published in The Wall Street Journal on the first business day of the Delay Period, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
(d) For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “within sixty (60) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue from, Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel .
(b) A termination of a national reputation with expertise in Section 409A that employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award providing for the payment of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, then for purposes of any amounts payable hereunder on account such provision of this Agreement, references to a “termination,” “termination of the Executive’s employment and which are subject to Section 409A employment” or like terms shall not be paid until the Executive has experienced a mean “separation from service” within the meaning of Section 409A..”
(iiic) All With regard to any provision herein that provides for reimbursement of costs and expenses or other reimbursements in-kind benefits, except as provided herein shall be payable in accordance with permitted by Code Section 409A, (i) the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
(d) For purposes of Code Section 409A, Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “within sixty (60) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
Appears in 1 contract
Sources: Employment Agreement (Cicero Inc)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to the extent penalty that such modification may be imposed on Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement Agreement, the parties hereto agree that the bona fide level of services that Executive will be required to perform pursuant to Section 1(b) shall in no event be at a level that would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s prevent Executive from being treated as having a “separation from service” (within the meaning of-of Code Section 409A), then such payment or benefit required under this Agreement ) on the Transition Date.
(c) A termination of employment shall not be paid (deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amount or commence) during the six-month period immediately benefit upon or following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, then for purposes of any amounts payable hereunder on account such provision of this Agreement, references to a “termination,” “termination of the Executive’s employment and which are subject to Section 409A employment” or like terms shall not be paid until the Executive has experienced a mean “separation from service” within the meaning of Section 409A..”
(iiid) All expenses To the extent that any expense reimbursement or in-kind benefit under this Agreement constitutes “non-qualified deferred compensation” for purposes of Code Section 409A, (i) such expense or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event reimbursement hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (ii) any right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit, and (iii) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, Executive’s right to receive installment payments pursuant to this Agreement shall not be subject treated as a right to liquidation or exchanged for another benefitreceive a series of separate and distinct payments.
Appears in 1 contract
Sources: Separation Agreement (Burlington Coat Factory Investments Holdings, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides In no event whatsoever shall the Company with documentation from Executive’s tax counsel of a national reputation with expertise in be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A or damages for failing to comply with Code Section 409A.
(b) In the event that any provision of this Agreement (is determined by the Company or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under not comply with Code Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination409A, the Company and the shall fully cooperate with Executive agree to work in good faith to reform this Agreement to correct such provision (noncompliance to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with guidance, procedure, or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed method promulgated by the Company hereunder Internal Revenue Service now or in the future that provides for such correction as a means to avoid or mitigate any taxes, interest, or penalties that would otherwise be incurred by Executive on account of such noncompliance.
(c) otherwise accelerate the timing A termination of payments owed by the Company hereunder or (ii) employment shall not be responsible deemed to have occurred for the failure purposes of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.”
(d) Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then each of the following shall apply:
(i) With regard to any amounts payment that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” such payment shall be made on the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of Executive, and (B) the date of Executive’s death (the “Delay Period”) to the extent required under Code Section 409A. Upon the expiration of the Delay Period, all payments delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid to Executive in a lump sum, and all remaining payments due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein; and
(ii) To the extent that any benefits to be provided during the Delay Period are considered deferred compensation under Code Section 409A provided on account of a “separation from service,” and such benefits are not otherwise exempt from Code Section 409A, Executive shall pay the cost of such benefits during the Delay Period, and the Company shall reimburse Executive (to the extent that such costs would otherwise have been paid by the Company or to the extent that such benefits would otherwise have been provided by the Company at no cost to Executive) the Company’s share of the cost of such benefits upon expiration of the Delay Period, and any remaining benefits shall be reimbursed or provided by the Company in accordance with the procedures specified herein.
(e) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following the meaning date of Executive’s termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately after the date the release is executed and no longer subject to revocation ( “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following Executive’s termination of employment.
(ii) To the extent any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payments made thereafter shall continue as provided herein. The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following Executive’s termination of employment. The Company may provide, in its sole discretion, that Executive may continue to participate in any benefits delayed pursuant to this Section during the period of such delay, provided that Executive shall bear the full cost of such benefits during such delay period. Upon the date such benefits would otherwise commence pursuant to this Section, the Company may reimburse Executive the Company’s share of the cost of such benefits, to the extent that such costs would otherwise have been paid by the Company or to the extent that such benefits would otherwise have been provided by the Company at no cost to Executive, in each case had such benefits commenced immediately upon Executive’s termination of employment. Any remaining benefits shall be reimbursed or provided by the Company in accordance with the schedule and procedures specified herein.
(f) For purposes of Code Section 409A, Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.
(g) Notwithstanding any other provisions of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be subject to offset, counterclaim or recoupment by any other amount payable to Executive unless otherwise permitted by Code Section 409A.
(iiih) All expenses Unless this Agreement provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or other reimbursements as provided herein shall compensation is to be payable paid for a specified continuing period of time beyond the date of Executive’s termination of employment in accordance with the Company’s policies in effect from time to timepayroll practices (or other similar term), but in any event the payments of such base salary or other compensation shall be made on upon such schedule as in effect upon the date of termination, but no less frequently than monthly or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitshorter interval specified herein.
Appears in 1 contract
Code Section 409A Compliance. (iA) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If Any payments that qualify for the Executive provides short-term deferral exception, the separation pay exception or another exception under Code Section 409A shall be paid under the applicable exception. For purposes of the limitations on deferred compensation under Code Section 409A, each payment of compensation under this Agreement shall be treated as a separate payment of compensation for all purposes under Code Section 409A. In the event that the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines reasonably and in Section 409A good faith that there is any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would that could cause the Executive to incur any be subject to additional tax tax, interest or interest penalties under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from provisions of Code Section 409A, such modification provision shall be made interpreted and resolved in the manner the Company reasonably and in good faith and shall▇▇▇▇▇ ▇▇▇▇▇ necessary to prevent the application of such taxes, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and interest or penalties under Code Section 409A. In no event whatsoever shall the Company of be liable for any additional tax, interest or penalty that may be imposed on the applicable provision without violating the provisions of Executive by Code Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iiB) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall not be made or provided until the meaning date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiiC) All To the extent that payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute “deferred compensation” under Code Section 409A unless such release is signed and delivered, and the period for revocation has expired, within sixty (60) days following the date of the Executive’s termination of employment. In this regard, the Company agrees to provide the Executive with the form of release required under Section 5(I) no later than 5 days after the Executive’s termination date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to be provided is not “deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all such amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement, applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “deferred compensation” for purposes of Code Section 409A, then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(D) With respect to reimbursements or other in-kind benefits under this Agreement, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(E) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be, to the extent permitted under Code Section 409A, within the sole discretion of the Company.
(F) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code Section 409A of 1986, as amended (the “Code”) and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides In no event whatsoever shall the Company with documentation from Executive’s tax counsel of a national reputation with expertise in be liable for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order damages for failing to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) Notwithstanding any other provision of this Agreement anything herein to the contrary, if (A) the Executive is Severance Benefits shall be paid only in connection with a “specified employee” within the meaning termination of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits employment that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute constitutes a “separation from service” within the meaning of Code Section 409A and (B) if Executive is a “specified employee” as such term is defined under Code Section 409A, then any amounts payable hereunder on account of a termination payment of the Severance Benefits shall be delayed for a period of six (6) months following Executive’s separation of employment to the extent and which up to an amount necessary to ensure such payments are not subject to the penalties and interest under Code Section 409A. If the payments are delayed as a result of the previous sentence, then on the first business day following the end of such six (6) month period (or such earlier date upon which such amount can be paid under Code Section 409A without resulting in a prohibited distribution), the Company shall not be paid until pay Executive a lumpsum amount equal to the cumulative amount that would have otherwise been payable to Executive has experienced a “separation from service” within the meaning of Section 409A.during such period.
(iii) All For purposes of compliance with Code Section 409A, (A) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (B) any right to reimbursement or inkind benefits is not subject to liquidation or exchange for another benefit and (C) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or inkind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement reimbursement, or inkind benefits to be provided, in any other taxable year and the year.
(iv) For purposes of Code Section 409A, Executive’s right to reimbursement or in-kind benefits receive any installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments.
(v) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation or exchanged for another benefit.offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from Internal Revenue the definition of “nonqualified deferred compensation” under section 409A of the Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409Apossible in a manner consistent with the foregoing statement of intent.
(b) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein in this Agreement or elsewhere to the contrary, for purposes of determining the Company shall not (i) be obligated to modify or amend payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A of the Code that become payable under this Agreement in any manner to connection with a termination of employment, the extent that such modification Date of Termination shall be the date on which the Executive has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or in subsequent IRS guidance under Code section 409A.
(c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of Notwithstanding anything in this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement elsewhere to the contrary, if the Company reasonably determines that (A) the Executive is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executive’s “separation from service” Date of Termination and (within the meaning of-Section 409A), then such payment B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during the six-month period immediately following in connection with the Executive’s separation from service except as provided service, including without limitation, payment of any of the payments on the scheduled payment dates specified in Section 3, will subject the immediately following sentence. In Executive to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then the Company shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment Date of Termination or, if earlier, the date of the Executive’s death (the “Delayed Payment Date”). In the event that this Section 10(c) requires any payments to be withheld, such withheld payments shall be accumulated and which are subject to paid in a single lump sum, with interest at the applicable federal rate provided in section 7872(f)(2) of the Code, on the Delayed Payment Date.
(d) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A shall not to be paid until made to the Executive has experienced within a “separation from service” designated period (e.g., within 30 days after the meaning Date of Section 409A.
(iiiTermination) All expenses or other reimbursements as provided herein and such period begins and ends in different calendar years, the exact payment date within such range shall be payable in accordance with determined by the Company’s policies , in effect from time its sole discretion, and the Executive shall have no right to time, but in any event shall be made on or prior to designate the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year the payment shall in any way affect the expenses eligible for reimbursement in any other taxable year be made.
(e) The Company and the Executive’s right Executive may agree to reimbursement take other actions to avoid the imposition of a Section 409A Tax at such time and in such manner as permitted under Section 409A.”
4. The Employment Agreement is and shall continue in full force and effect, except as amended by this Amendment.
5. Any and all capitalized terms which are not explicitly defined herein shall have the meaning ascribed to them in the Employment Agreement.
6. This Amendment may be signed in counterpart originals, which collectively shall have the same legal effect as if all signature appeared on the same physical document. This Amendment may be signed and exchanged by electronic or in-kind benefits shall not be subject to liquidation or exchanged for another benefitfacsimile transmission, with the same legal effect as if the signatures had appeared in original handwriting on the same physical document.
Appears in 1 contract
Sources: Employment Agreement (Incyte Corp)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to penalty that may be imposed on the extent that such modification Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding An "Employment Separation" shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive payment of any amounts or benefits upon or following an Employment Separation unless such Employment Separation is also a “specified employee” "separation from service" within the meaning of Code Section 409A409A and, and for purposes of any such provision of this Agreement, references to an Employment Separation or like terms shall mean "separation from service." If the Executive is deemed on the date of termination to be a "specified employee" within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any payment or the provision of any benefit provided for in this Agreement would be subject to additional tax that is considered deferred compensation under Code Section 409A if payable on account of a "separation from service," such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and at the date which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on is the earlier of (i) the first business day expiration of the seventh month following six (6)-month period measured from the date of such "separation from service" of the Executive’s separation from service or , and (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the Executive’s employment 's death (the "Delay Period"). Upon the expiration of the Delay Period, all payments and which are subject benefits delayed pursuant to this Section 409A (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall not be paid until or reimbursed to the Executive has experienced in a “separation from service” within lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the meaning of Section 409A.normal payment dates specified for them herein.
(iiic) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event under this Agreement shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive (provided that if any such reimbursements constitute taxable income to the Executive. In addition, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and year.
d) For purposes of Code Section 409A, the Executive’s 's right to reimbursement receive any installment payments pursuant to this Agreement shall be treated as a right to Change in Control & Non-competition Agreement I Mohamed receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., "payment shall be made within thirty (30) days"), the actual date of payment within the specified period shall be within the sole discretion of the Company.
e) In no event shall any payment under this Agreement that constitutes "deferred compensation" for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitotherwise."
Appears in 1 contract
Sources: Change in Control & Non Competition Agreement (Commercial Vehicle Group, Inc.)
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contrary, In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to penalty that may be imposed on the extent that such modification Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding An “Employment Separation” shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if upon or following an Employment Separation unless such payment or benefit Employment Separation is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to an Employment Separation or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall be made or provided at the meaning date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 409A.(whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
(iiic) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event under this Agreement shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by the Executive (provided that if any such reimbursements constitute taxable income to the Executive. In addition, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and year.
(d) For purposes of Code Section 409A, the Executive’s right to reimbursement receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within thirty (30) days”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
(e) In no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or in-kind benefits otherwise.” SIXTH: Except as specifically modified herein, the Agreement shall not be subject to liquidation or exchanged for another benefitremain in full force and effect in accordance with all of the terms and conditions thereof.
Appears in 1 contract
Sources: Change in Control & Non Competition Agreement (Commercial Vehicle Group, Inc.)
Code Section 409A Compliance. (iA) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in by Code Section 409A that or damages for failing to comply with Code Section 409A.
(B) A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible providing for the failure payment of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A upon or following a termination of employment if such payment or benefit is paid within six months after the Executive’s constitutes a “separation from servicedeferral of compensation” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Code Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s unless such termination of employment hereunder does not constitute is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such payment or benefit, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service”, such payment or benefit shall not be made or provided until the date which is the earlier of (i) the first day of the seventh month following the date of such “separation from service” of the Executive, and (ii) the date of the Executive’s death, to the extent required under Code Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. I To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by the Executive of a release of claims, the Executive shall forfeit all rights to such payments and benefits which constitute a “deferral of compensation” under Code Section 409A unless such release is signed and delivered within sixty (60) days following the meaning date of the Executive’s termination of employment. In this regard, the Company agrees to provide the Executive with the form of release required under Section 409A.5(J) no later than 5 days after the Executive’s termination date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then the following shall apply:
(iiii) All To the extent that any such cash payment or continuing benefit to be provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then, subject to the delay set forth above in clause (B), if applicable, such payments or benefits shall be made or commence upon the sixtieth (60th) day following the Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.
(D) To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (i) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s , (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
(E) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(F) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
Appears in 1 contract
Sources: Employment and Non Competition Agreement (Vitamin Shoppe, Inc.)
Code Section 409A Compliance. (i) The intent 11.1 This Agreement is intended to comply with, or otherwise be exempt from, Section 409A of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A of 1986 as amended, and the any regulations and Treasury guidance promulgated thereunder (collectively, “Section 409A409A of the Code”) and, accordingly, ).
11.2 Company and Executive agree that they will execute any and all amendments to the maximum extent permitted, this Agreement as they mutually agree in good faith may be necessary to ensure compliance with the provisions of Section 409A of the Code.
11.3 The preceding provisions, however, shall not be construed as a guarantee by Company of any particular tax effect to Executive under this Agreement. No Company Group Member shall be interpreted liable to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that for any provision of payment made under this Agreement (or any award of compensationwhich is determined to result in an additional tax, including equity compensation or benefits) would cause Executive to incur any additional tax penalty or interest under Section 409A (with specificity as to of the reason therefore) or the Company independently makes such determinationCode, the Company and the Executive agree to work nor for reporting in good faith to reform such provision (to the extent permitted any payment made under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement as an amount includible in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax gross income under Section 409A if such payment or benefit is paid within six months after of the Executive’s “separation from service” (within Code.
11.4 For purposes of Section 409A of the meaning of-Section 409A)Code, then such payment or benefit required the right to a series of installment payments under this Agreement shall not be paid (treated as a right to a series of separate payments.
11.5 With respect to any reimbursement of expenses or commence) during the sixany provision of in-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In kind benefits to Executive specified under this Agreement, such an event, any payments reimbursement of expenses or provision of in-kind benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid subject to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or conditions: (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement or the amount of in-kind benefits provided in any one taxable year shall in any way not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year, except for any medical reimbursement arrangements providing for the reimbursement of expenses referred to in Section 105(b) of the Code; (ii) the reimbursement of an eligible expense shall be made no later than the end of the year following the year in which such expense was incurred; and (iii) the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit.
11.6 Notwithstanding anything in this Agreement to the contrary, if a payment obligation arises on account of Executive’s separation from service while Executive is a “specified employee” as described in Section 409A of the Code and the Treasury Regulations thereunder and as determined by Company in accordance with its procedures, by which determination Executive is bound, any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A- 1(b)(3) through (b)(12)) shall be made on the first (1st) business day of the seventh (7th) month following the date of Executive’s separation from service, or, if earlier, within fifteen (15) days after the appointment of the personal representative or executor of Executive’s estate following Executive’s death.
Appears in 1 contract
Sources: Employment Agreement (Airsculpt Technologies, Inc.)
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. a. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Internal Revenue Code (“Code”) Section 409A (with specificity as to the reason therefore) or the Company independently makes such determinationany regulations or Treasury guidance promulgated thereunder, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (provision, to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order possible, to comply with or be exempt from Code Section 409A; provided, that the Company agrees to make only such modification shall be made in good faith changes as are necessary to bring such provisions into compliance with Code Section 409A and shallto maintain, to the maximum extent reasonably possiblepracticable, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) b. Notwithstanding any other provision of this Agreement to the contrarycontrary in this Agreement, if the Executive is deemed on the date of termination of employment to be a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any -9- ME1 15728518v.2 payment or the provision of any benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Section 409A if 409A(a)(2)(B) such payment or benefit is paid within shall not be made or provided (subject to the last sentence hereof) prior to the earlier of (i) the expiration of the six months after (6)-month period measured from the date of the Executive’s “separation from service” (within the meaning of-as such term is defined in Treasury Regulations issued under Code Section 409A) or (ii) the date of Executive’s death (the “Deferral Period”). Upon the expiration of the Deferral Period, then all payments and benefits deferred pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such payment or benefit required under this Agreement deferral) shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then and any amounts payable hereunder on account of a termination of the Executive’s employment remaining payments and which are subject to Section 409A benefits due under this Agreement shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenormal payment dates specified for them herein. Notwithstanding the foregoing, but in any event shall be made on or prior to the last day extent that the foregoing applies to the provision of any ongoing welfare benefits to the taxable year following Executive that would not be required to be delayed if the taxable year in which premiums therefor were paid by the Executive, the Executive shall pay the full cost of premiums for such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect welfare benefits during the expenses eligible for reimbursement in any other taxable year Deferral Period and the Executive’s right Company shall pay (or cause to reimbursement or in-kind benefits shall not be subject paid) to liquidation or exchanged for another benefitthe Executive an amount equal to the amount of such premiums paid by the Executive during the Deferral Period promptly after its conclusion.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of To the parties is that payments fullest extent applicable, amounts and benefit other benefits payable under this Agreement comply with or are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder of 1986, as amended (collectively, “Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, accordingly, to the maximum extent permittedthat any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement is intended to comply with the applicable requirements of Section 409A with respect to such amounts or benefits. This Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (administered to the extent permitted under Section 409A) to possible in a manner consistent with the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company foregoing statement of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.intent.
(ii) Notwithstanding any other provision of anything in this Agreement or elsewhere to the contrary, for purposes of determining the payment date of any amounts that are treated as nonqualified deferred compensation under Section 409A of the Code that become payable under this Agreement in connection with a termination of employment, the date that the Employee is deemed to have incurred a termination of employment shall be the date on which the Employee has incurred a “separation from service” within the meaning of Treasury Regulation section 1.409A-1(h), or in subsequent IRS guidance under Code section 409A.
(iii) For purposes of Section 409A, each salary continuation payment payable under Section 8(d) shall constitute a separate “payment” within the meaning of Treasury Regulation Section 1.409A-2(b)(2).
(iv) Notwithstanding anything in this Agreement or elsewhere to the contrary, if Live Nation reasonably determines that (A) the Executive Employee is a “specified employee” (within the meaning of Treasury Regulation Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after 1.409A-1(i)) on the Executivedate of the Employee’s “separation from service” (within the meaning of-of Treasury Regulation Section 409A1.409A-1(h), then such payment ) and (B) commencement of any payments or benefit required other benefits payable under this Agreement shall not be paid (or commence) during in connection with the six-month period immediately following the ExecutiveEmployee’s separation from service except as provided on the scheduled payment dates specified in Sections 8(c) through (e), will subject the immediately following sentence. In Employee to an “additional tax” under Section 409A(a)(1)(B) (together with any interest or penalties imposed with respect to, or in connection with, such an eventtax, a “Section 409A Tax”), then Live Nation shall withhold payment of any such payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) until the first business day of the seventh month following the Executivedate of the Employee’s separation from service or (ii) or, if earlier, the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination date of the ExecutiveEmployee’s employment death (the “Delayed Payment Date”). In the event that this Section 8(g)(iv) requires any payments to be withheld, such withheld payments shall be accumulated and which are paid in a single lump sum, without interest, on the Delayed Payment Date.
(v) In each case where this Agreement provides for the payment of an amount that constitutes nonqualified deferred compensation under Section 409A to be made to the Employee within a designated period (e.g., within 30 days after the date of termination) and such period begins and ends in different calendar years, the exact payment date within such range shall, subject to Section 8(g)(iv) above, be determined by Live Nation, in its sole discretion, and the Employee shall have no right to designate the year in which the payment shall be made.
(vi) Live Nation and the Employee may agree to take other actions to avoid the imposition of a Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Tax at such time and in such manner as permitted under Section 409A.
(iiivii) All expenses Notwithstanding anything herein to the contrary, the Employee expressly agrees and acknowledges that in the event that any Section 409A Tax is imposed in respect of any compensation or other reimbursements as provided herein benefits payable to the Employee, whether under this Agreement or otherwise, then (A) the payment of such Section 409A Tax shall be payable in accordance with solely the CompanyEmployee’s policies in effect from time to timeresponsibility, but in (B) neither Live Nation, its affiliated entities nor any event of their respective past or present directors, officers, employees or agents shall be made on or prior have any liability for any such Section 409A Tax, and (C) the Employee shall indemnify and hold harmless, to the last day greatest extent permitted under law, each of the taxable year following the taxable year foregoing from and against any claims or liabilities that may arise in which respect of any such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitSection 409A Tax.”
Appears in 1 contract
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. a. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause the Executive to incur any additional tax or interest under Internal Revenue Code (“Code”) Section 409A (with specificity as to the reason therefore) or the Company independently makes such determinationany regulations or Treasury guidance promulgated thereunder, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (provision, to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order possible, to comply with or be exempt from Code Section 409A; provided, that the Company agrees to make only such modification shall be made in good faith changes as are necessary to bring such provisions into compliance with Code Section 409A and shallto maintain, to the maximum extent reasonably possiblepracticable, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(ii) b. Notwithstanding any other provision of this Agreement to the contrarycontrary in this Agreement, if the Executive is deemed on the date of termination of employment to be a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for that is required to be delayed in this Agreement would be subject to additional tax under compliance with Section 409A if 409A(a)(2)(B) such payment or benefit is paid within shall not be made or provided (subject to the last ME1 15728518v.2 sentence hereof) prior to the earlier of (i) the expiration of the six months after (6)-month period measured from the date of the Executive’s “separation from service” (within the meaning of-as such term is defined in Treasury Regulations issued under Code Section 409A) or (ii) the date of Executive’s death (the “Deferral Period”). Upon the expiration of the Deferral Period, then all payments and benefits deferred pursuant to this Section 19 (whether they would have otherwise been payable in a single sum or in installments in the absence of such payment or benefit required under this Agreement deferral) shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid reimbursed to the Executive in a lump-sum cash paymentlump sum, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then and any amounts payable hereunder on account of a termination of the Executive’s employment remaining payments and which are subject to Section 409A benefits due under this Agreement shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timenormal payment dates specified for them herein. Notwithstanding the foregoing, but in any event shall be made on or prior to the last day extent that the foregoing applies to the provision of any ongoing welfare benefits to the taxable year following Executive that would not be required to be delayed if the taxable year in which premiums therefor were paid by the Executive, the Executive shall pay the full cost of premiums for such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect welfare benefits during the expenses eligible for reimbursement in any other taxable year Deferral Period and the Executive’s right Company shall pay (or cause to reimbursement or in-kind benefits shall not be subject paid) to liquidation or exchanged for another benefitthe Executive an amount equal to the amount of such premiums paid by the Executive during the Deferral Period promptly after its conclusion.
Appears in 1 contract
Sources: Change in Control Severance Agreement (Stewardship Financial Corp)
Code Section 409A Compliance. (a) The parties hereto recognize that certain provisions of this Agreement may be affected by Section 409A of the Internal Revenue Code and guidance issued thereunder, and agree to amend this Agreement, or take such other action as may be necessary or advisable, to comply with Section 409A. The parties hereto intend that the Agreement, as amended, be consistent with IRS Notice 2007-78, IRS Notice 2007-86 and other Code Section 409A transition relief, and it shall be interpreted accordingly.
(b) Notwithstanding anything herein to the contrary, it is expressly understood that at any time the Company (or any related employer treated with the Company as the service recipient for purposes of Code Section 409A) is publicly traded on an established securities market (as defined for purposes of Code Section 409A), if a payment or provision of an amount or benefit constituting a deferral of compensation is to be made pursuant to the terms of this Agreement to the Employee on account of a Separation from Service at a time when the Employee is a Specified Employee (as defined for purposes of Code Section 409A(a)(2)(B)(i)), such deferred compensation shall not be paid to the Employee prior to the date that is six (6) months after the Separation from Service or as otherwise permitted under Treasury Regulations Section 1.409A-3(i)(2).
(c) For purposes of this Agreement, the following definitions shall apply:
(i) The intent Separation from Service means, generally, a termination of employment with the parties is that payments Company, and benefit under this Agreement comply with or be exempt from shall have the same meaning as such term has for purposes of Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “including Treasury Regulation Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith1.409A-1(h)). If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.3
(ii) Notwithstanding any other provision of this Agreement Involuntary Separation from Service means a Separation from Service due to the contraryindependent exercise of the unilateral authority of the Company to terminate the Employee’s employment, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid other than due to the Executive in a lump-sum cash paymentEmployee’s implicit or explicit request, without interest, on where the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of Employee was willing and able to continue to employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect . Notwithstanding the foregoing, a termination for Good Reason may constitute an Involuntary Separation from time to time, but in any event Service. Involuntary Separation from Service shall be made on or prior to have the last day same meaning as such term has for purposes of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefitInternal Revenue Code Section 409A (including Treasury Regulation Section 1.409A-1(n)).”
Appears in 1 contract
Sources: Employment Agreement (Axs One Inc)
Code Section 409A Compliance. Notwithstanding any provision of this Agreement to the contrary:
(i1) The If and to the extent any payment or benefits under this Agreement are otherwise subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, including any regulations and other applicable authorities promulgated thereunder (the “Code”), the intent of the parties is that payments such payment and benefit under this Agreement benefits shall comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted interpreted, and such payment and benefits shall be paid or provided under such other conditions determined by the Company that cause such payment and benefits, to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein The Company makes no representation that any or all of the payments or benefits provided under this Agreement will be exempt from or comply with Code Section 409A and makes no undertaking to the contrary, preclude Code Section 409A from applying to any such payments or benefits. In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to the extent penalty that such modification may be imposed on Executive by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(ii2) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, then for purposes of any amounts payable hereunder on account such provision of this Agreement, references to a “termination,” “termination of the Executive’s employment and which are subject to Section 409A employment” or like terms shall not be paid until the Executive has experienced a mean “separation from service” within the meaning of Section 409A..”
(iii3) All expenses Each payment payable to Executive under this Section 6 on or other reimbursements after his date of termination shall be treated as a separate and distinct “payment” for purposes of Code Section 409A and, further is intended to be exempt from Code Section 409A, including but not limited to the short-term deferral and involuntary separation pay plan exemptions thereunder. If and to the extent any such payment is determined to be subject to Code Section 409A and is otherwise payable upon Executive’s termination of employment, in the event Executive is a “specified employee” (as defined in Code Section 409A), any such payment that would otherwise have been payable in the first six (6) months following Executive’s termination of employment will not be paid to Executive until the date that is six (6) months and one (1) day following the date of Executive’s termination of employment (or, if earlier, Executive’s date of death). Any such deferred payments will be paid in a lump sum; provided herein that no such actions shall reduce the amount of any payments otherwise payable to Executive under this Agreement. Thereafter, the remainder of any such payments shall be payable in accordance with the Company’s policies in effect from time this Section 6.
(4) With respect to timeany right to reimbursement of expenses or in-kind benefits under this Agreement, but in any event (i) all reimbursement of expenses to Executive shall be made on or prior to the last day of the Executive’s taxable year following the taxable year in which such expenses were incurred by Executive. In addition, except that if any such reimbursements constitute taxable income to Executive, such reimbursements shall be paid no such reimbursement or later than March 15th of calendar year following the calendar year in which the expenses to be reimbursed were incurred, (ii) the amount of expenses eligible for reimbursement in any reimbursement, or in-kind benefits provided, during Executive’s taxable year shall not in any way affect the expenses eligible for reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year year, and (iii) the Executive’s right to reimbursement or in-kind benefits shall is not be subject to liquidation or exchanged exchange for another benefit.
(5) Whenever a payment under this Agreement specifies a period within which such payment may be made, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(6) In no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or otherwise.
(7) To the extent required under Code Section 409A, (i) any reference herein to the term “Agreement” shall mean this Agreement and any other plan, agreement, method, program, or other arrangement, with which this Agreement is required to be aggregated under Code Section 409A, and (ii) any reference herein to the term “Company” shall mean the Company and all persons with whom the Company would be considered a single employer under Code Section 414(b) or 414(c).
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties Parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, .
(b) increase any amounts owed by If D▇. ▇▇▇▇ is deemed on the Company hereunder or (c) otherwise accelerate the timing date of payments owed by the Company hereunder or (ii) “separation from service” to be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of that term under Code Section 409A409A(a)(2)(B), and a then with regard to any payment or the provision of any benefit provided for in this Agreement would be that is specified as subject to additional tax under Section 409A if this Section, such payment or benefit shall be made or provided at the date which is paid within the earlier of (A) the expiration of the six months after (6) month period measured from the Executive’s date of such “separation from service” of D▇. ▇▇▇▇, and (within B) the meaning of-date of D▇. ▇▇▇▇’▇ death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 409A)32(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to D▇. ▇▇▇▇ in a lump sum, then such payment or benefit required and any remaining payments and benefits due under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies normal payment dates specified for them herein.
(c) To the extent that the time and form of payments specified hereunder would be considered a change in effect from the time and form of payments of deferred compensation provided by the Employment Agreement, the Parties intend that the transition rules of IRS Notice 2007-86 apply (as an election or amendment to time, but in any event shall be change a time and form of payment made on or prior after January 1, 2007 and on or before December 31, 2007 for amounts not otherwise payable in 2007 and do not cause an amount to the last day of the taxable year following the taxable year be paid in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement 2007 that would not otherwise payable in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged for another benefit2007).
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue from, Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides notifies the Company (with documentation from Executive’s tax counsel specificity as to the reason therefor) that the Executive believes that as a result of a national reputation with expertise in Section 409A that subsequent published guidance issued by the I.R.S. upon which taxpayers generally rely, any provision of this Agreement (or of any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Code Section 409A (and the Company concurs with specificity as to the reason therefore) such belief or the Company independently makes such determination, the Company and shall, after consulting with the Executive agree to work in good faith to Executive, reform such provision (to the extent permitted under try to comply with Code Section 409A) 409A through good faith modifications to the minimum extent reasonably necessary appropriate to conform with Code Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company and is tax neutral to the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “nonqualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (B) thirty (30) days from the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 20 (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum with interest at the prime rate as published in The Wall Street Journal on the first business day of the Delay Period, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
(d) For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “within sixty (60) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company.
Appears in 1 contract
Code Section 409A Compliance. (i) a. The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement damages for failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(ii) Notwithstanding b. A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service. Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall be made on the meaning date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (ii) the date of Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this paragraph (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
c. To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (iiii) All all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in (ii) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (iii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year.
d. Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment or benefit under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409 A.
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively409A, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted and applied so as to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the The Company and the Executive agree to work together in good faith to reform consider amendments to this Agreement and to take such provision (reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in following a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute that are considered “non-qualified deferred compensation” under Code Section 409A unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination”, “termination of employment”, or like terms shall mean “separation from service”. If the Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment that is considered non-qualified deferred compensation under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made or provided at the date which is the earlier of (A) the expiration of the six (6) month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section 26(b) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Company’s policies in effect from time normal payment dates specified for them herein.
(c) With regard to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible provision herein that provides for reimbursement in any taxable year shall in any way affect of costs and expenses or in-kind benefits, except as permitted by Code Section 409A: (i) the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Internal Revenue Code Section 105(b) solely because such expenses are subject to a limit related to the period arrangement is in effect and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred. For purposes of Code Section 409A, the Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may the Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation. In no event shall the timing of Executive’s execution of the General Release, directly or indirectly, result in the Executive designating the calendar year of payment, and if a payment that is subject to execution of the General Release could be made in more than one taxable year, payment shall be made in the later taxable year.
Appears in 1 contract
Sources: Employment Agreement (Amylyx Pharmaceuticals, Inc.)
Code Section 409A Compliance. (i) The intent of the parties is that payments and benefit benefits under this Agreement comply with with, or be exempt from from, Section 409A of the Internal Revenue Code Section 409A of 1986, as amended (the “Code”) and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides ; provided, that the Company does not guarantee to Consultant any particular tax treatment with documentation from Executive’s tax counsel of a national reputation with expertise in respect to this Agreement and any payments hereunder. In no event whatsoever shall the Company be liable for any additional tax, interest or penalties that may be imposed on Consultant by Code Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order damages for failing to comply with or be exempt from Code Section 409A. For purposes of Code Section 409A, such modification Consultant’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made in good faith and shallwithin ten calendar days following the date of termination”), to the maximum extent reasonably possible, maintain actual date of payment within the original intent and economic benefit to Executive and specified period shall be within the Company sole discretion of the applicable provision without violating Company. In no event may Consultant, directly or indirectly, designate the provisions calendar year of Section 409A. Notwithstanding anything contained herein any payment to the contrary, the Company shall not (i) be obligated to modify or amend made under this Agreement in that is considered non-qualified deferred compensation. With regard to any manner to the extent provision herein that such modification provides for reimbursement of costs and expenses or amendment would (a) increase the Company’s obligations hereunderin-kind benefits, (b) increase any amounts owed except as permitted by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Code Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year; provided, that this clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect; and (iii) such payments shall be made on or before the last day of Consultant’s taxable year following the taxable year in which the expense was incurred.
Appears in 1 contract
Code Section 409A Compliance. Notwithstanding any provision of this Agreement to the contrary:
(ia) The If and to the extent any payment or benefits under this Agreement are otherwise subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, including any regulations and other applicable authorities promulgated thereunder (the “Code”), the intent of the parties Parties is that payments such payment and benefit under this Agreement benefits shall comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted interpreted, and such payment and benefits shall be paid or provided under such other conditions determined by the Company that cause such payment and benefits, to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Parties hereto of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein The Company makes no representation that any or all of the payments or benefits provided under this Agreement will be exempt from or comply with Code Section 409A and makes no undertaking to the contrary, preclude Code Section 409A from applying to any such payments or benefits. In no event whatsoever shall the Company shall not (i) be obligated to modify liable for any additional tax, interest or amend this Agreement in any manner to the extent penalty that such modification may be imposed on Employee by Code Section 409A or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding To the extent required under Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments amounts or benefits that would otherwise have been made upon or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the ExecutiveEmployee’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, then for purposes of any amounts payable hereunder on account such provision of this Agreement, references to a “termination,” “termination of the Executive’s employment and which are subject to Section 409A employment” or like terms shall not be paid until the Executive has experienced a mean “separation from service” within the meaning of Section 409A..”
(iiic) Each payment payable to Employee under Section 6 on or after his date of termination shall be treated as a separate and distinct “payment” for purposes of Code Section 409A and, further is intended to be exempt from Code Section 409A, including but not limited to the short-term deferral exemption thereunder. If and to the extent any such payment is determined to be subject to Code Section 409A and is otherwise payable upon Employee’s termination of employment, in the event Employee is a “specified employee” (as defined in Code Section 409A), any such payment that would otherwise have been payable in the first six (6) months following Employee’s termination of employment will not be paid to Employee until the date that is six (6) months and one (1) day following the date of Employee’s termination of employment (or, if earlier, Employee’s date of death). Any such deferred payments will be paid in a lump sum; provided that no such actions shall reduce the amount of any payments otherwise payable to Employee under this Agreement. Thereafter, the remainder of any such payments shall be payable in accordance with Section 6.
(d) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to timeEmployee under this Agreement, but in any event if any, shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In additionEmployee (provided that if any such reimbursements constitute taxable income to Employee, such reimbursements shall be paid no later than March 15th of the calendar year following the calendar year in which the expenses to be reimbursed were incurred), and no such reimbursement or expenses eligible for reimbursement in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year.
(e) In no event may Employee, directly or indirectly, designate the calendar year of any payment under this Agreement. Whenever a payment under this Agreement specifies a period within which such payment may be made, the actual date of payment within the specified period shall be within the sole discretion of the Company. Further notwithstanding any provision of this Agreement to the contrary, if the time period set forth in Section 11 begins in one taxable year of Employee and ends in a subsequent taxable year, any payment or benefit scheduled to be provided under Section 6, to the Executive’s right to reimbursement extent such payment or in-kind benefits shall not be benefit is otherwise subject to liquidation the requirements of Code Section 409A, will commence in such subsequent taxable year of Employee.
(f) Whenever a payment under this Agreement specifies a period within which such payment may be made, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(g) In no event shall any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be offset by any other payment pursuant to this Agreement or exchanged for another benefitotherwise.
(h) To the extent required under Code Section 409A, (i) any reference herein to the term “Agreement” shall mean this Agreement and any other plan, agreement, method, program, or other arrangement, with which this Agreement is required to be aggregated under Code Section 409A, and (ii) any reference herein to the term “Company” shall mean the Company and all persons with whom the Company would be considered a single employer under Code Section 414(b) or 414(c).
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or be exempt from Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company Employer of the applicable provision without violating the provisions of Code Section 409A. Notwithstanding anything contained herein to the contraryIn no event whatsoever shall Employer be liable for any additional tax, the Company shall not (i) interest or penalty that may be obligated to modify imposed on Executive by Code Section 409A or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible damages for the failure of this Agreement failing to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under with Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean “separation from service.” Notwithstanding any other payment schedule provided herein to the contrary, if Executive is deemed on the date of termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any amounts payment or the provision of any benefit that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within the meaning of Section 409A.
(iii) All expenses such payment or other reimbursements as provided herein benefit shall be made on the date which is the earlier of (i) the expiration of the six (6)-month period measured from the date of Executive’s “separation from service,” and (B) the date of Executive’s death, to the extent required under Code Section 409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to Executive in a lump sum, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the Companynormal payment dates specified for them herein.
(c) To the extent that severance payments or benefits pursuant to this Agreement are conditioned upon the execution and delivery by Executive of a release of claims, Executive shall forfeit all rights to such payments and benefits unless such release is signed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following the date of Executive’s policies termination of employment. If the foregoing release is executed and delivered and no longer subject to revocation as provided in effect from time the preceding sentence, then the following shall apply:
(i) To the extent that any such cash payment or continuing benefit to timebe provided is not “nonqualified deferred compensation” for purposes of Code Section 409A, but in then such payment or benefit shall commence upon the first scheduled payment date immediately following the date that the release is executed, delivered and no longer subject to revocation (the “Release Effective Date”). The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any event payment made thereafter shall continue as provided herein.
(ii) To the extent that any such cash payment or continuing benefit to be provided is “nonqualified deferred compensation” for purposes of Code Section 409A, then such payments or benefits shall be made or commence upon the sixtieth (60th) day following Executive’s termination of employment. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon Executive’s termination of employment, and any payment made thereafter shall continue as provided herein.
(d) To the extent that any expense reimbursement or in-kind benefit under this Agreement constitutes “non-qualified deferred compensation” for purposes of Code Section 409A, (i) such expense or other reimbursement hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, (ii) any right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit, and (iii) no such reimbursement or reimbursement, expenses eligible for reimbursement reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement reimbursement, or in-kind benefits to be provided, in any other taxable year.
(e) For purposes of Code Section 409A, Executive’s right to receive installment payments pursuant to this Agreement shall not be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of Employer.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to liquidation offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Unless this Agreement provides a specified and objectively determinable payment schedule to the contrary, to the extent that any payment of base salary or exchanged other compensation is to be paid for another benefita specified continuing period of time beyond the date of Executive’s termination of employment in accordance with Employer’s payroll practices (or other similar term), the payments of such base salary or other compensation shall be made upon such schedule as in effect upon the date of termination, but no less frequently than monthly.
(h) Any annual bonus payable to Executive in accordance with the provisions of Section 3(b) hereof shall be paid in the calendar year following the calendar year to which such bonus relates at the same time bonuses are paid to other senior executive officers of Employer generally.” The parties have duly executed this Agreement as of the date first written above. By: ▇▇▇▇ ▇. ▇▇▇▇▇▇ By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ Its: Chief Executive Officer
Appears in 1 contract
Code Section 409A Compliance. (ia) The intent of the parties is that payments and benefit benefits under this Agreement comply with or will not be exempt from subject to gross income inclusion, additional tax and interest provided for in Internal Revenue Code Section 409A and the regulations and guidance promulgated thereunder (collectively, collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, and this Agreement shall be interpreted to be in compliance therewithaccordingly. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefore) or the Company independently makes such determination, the Company and the Executive agree to work in good faith to reform such provision (to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from avoid application of Code Section 409A, such the modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to the Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein subjecting any payment hereunder to the contrary, the Company shall not (i) be obligated to modify or amend this Agreement in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunder, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply with, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Code Section 409A.
(iib) Notwithstanding A termination of employment shall not be deemed to have occurred for purposes of any other provision of this Agreement to providing for the contrary, if the Executive is a “specified employee” within the meaning payment of Section 409A, and a payment any amount or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such payment that constitutes “nonqualified deferred compensation” upon or benefit is paid within six months after the Executive’s “separation from service” (within the meaning of-Section 409A), then such payment or benefit required under this Agreement shall not be paid (or commence) during the six-month period immediately following the Executive’s separation from service except as provided in the immediately following sentence. In such an event, any payments or benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid to the Executive in a lump-sum cash payment, without interest, on the earlier of (i) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute unless such termination is also a “separation from service” within the meaning of Code Section 409A409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or similar terms shall mean “separation from service.”
(c) Notwithstanding anything to the contrary in this Agreement, if the Executive is deemed on the Date of Termination to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), i.e., is a key employee (as defined in Code Section 416(i) without regard to paragraph (5) thereof) of a corporation any stock in which is publicly traded on an established securities market or otherwise, then with regard to any amounts payment or the provision of any benefit under this Agreement that is considered “nonqualified deferred compensation” under Code Section 409A payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service,” within such payment or benefit shall not be made or provided until the meaning date that is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Executive, and (B) the date of the Executive’s death, to the extent required under Code Section 409A.409A. Upon the expiration of the foregoing delay period, all payments and benefits delayed pursuant to this Section 6(c)) (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum without interest from the original due date, and all remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. If any payment hereunder following termination of employment constitutes nonqualified deferred compensation under Code Section 409A and is contingent on Executive’s execution of a release, if the period for Executive’s review and execution of the release begins and ends in different tax years, then the payment contingent on execution of the Separation Agreement shall be paid to Executive in the later tax year to occur. Executive Employment Agreement
(iiid) All To the extent that reimbursements or other in-kind benefits under this Agreement constitute “nonqualified deferred compensation” for purposes of Code Section 409A, (A) all expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which the Executive incurs such expenses were incurred by Executive. In additionexpenses, no such reimbursement or expenses eligible for reimbursement in (B) any taxable year shall in any way affect the expenses eligible for reimbursement in any other taxable year and the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit, and (C) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided in any other taxable year.
(e) For purposes of Code Section 409A, the Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.
(f) Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment or benefit under this Agreement that constitutes “nonqualified deferred compensation” for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.
(g) Without in any way limiting the effect of the foregoing provisions of this Section
(i) if Code Section 409A requires that any special terms, provisions or conditions be included in this Agreement, then such terms, provisions and conditions shall, to the extent practicable, be deemed to be made a part of this Agreement; and
(ii) in the event that this Agreement shall be deemed to subject any payment hereunder to application of Code Section 409A, then, to the extent the Board considers it reasonable to do so, the Board and the Executive may attempt to amend the deferred compensation provided for herein, and the provisions of this Agreement related thereto, to avoid application of Code Section 409A, but, in any event, none of the Company, the Board nor its or their designees or agents shall be liable to the Executive or to any other person for actions, decisions or determinations made in good faith.
Appears in 1 contract
Code Section 409A Compliance. (i) The intent This Agreement is intended to comply with, or otherwise be exempt from, Section 409A of the parties is that payments and benefit under this Agreement comply with or be exempt from Internal Revenue Code of 1986, as amended (the “Code”) and any regulations and Treasury guidance promulgated thereunder.
(ii) The Company shall undertake to administer, interpret, and construe this Agreement in a manner that does not result in the imposition on the Executive of any additional tax, penalty, or interest under Section 409A and of the regulations and guidance promulgated thereunder Code.
(collectively, “Section 409A”iii) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If the Executive provides the Company with documentation from Executive’s tax counsel of a national reputation with expertise determines in Section 409A good faith that any provision of this Agreement (or any award of compensation, including equity compensation or benefits) would cause the Executive to incur any an additional tax tax, penalty, or interest under Section 409A (with specificity as to of the reason therefore) or the Company independently makes such determinationCode, the Company Compensation Committee and the Executive agree to work in good faith shall use reasonable efforts to reform such provision (provision, if possible, in a mutually agreeable fashion to the extent permitted under Section 409A) to the minimum extent reasonably necessary to conform with Section 409A. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, maintain to the maximum extent reasonably possible, maintain practicable the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A. Notwithstanding anything contained herein 409A of the Code or causing the imposition of such additional tax, penalty, or interest under Section 409A of the Code.
(iv) The preceding provisions, however, shall not be construed as a guarantee by the Company of any particular tax effect to the contrary, the Executive under this Agreement. The Company shall not (i) be obligated liable to modify Executive for any payment made under this Agreement, at the direction or amend this Agreement with the consent of Executive, that is determined to result in any manner to the extent that such modification or amendment would (a) increase the Company’s obligations hereunderan additional tax, (b) increase any amounts owed by the Company hereunder or (c) otherwise accelerate the timing of payments owed by the Company hereunder or (ii) be responsible for the failure of this Agreement to comply withpenalty, or be exempt from, Section 409A, or for any taxes, penalties or interest incurred by Executive under Section 409A.
(ii) Notwithstanding any other provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Section 409A, and a payment or benefit provided for in this Agreement would be subject to additional tax under Section 409A if such of the Code, nor for reporting in good faith any payment or benefit is paid within six months after made under this Agreement as an amount includible in gross income under Section 409A of the Executive’s “separation from service” Code.
(within v) For purposes of Section 409A of the meaning of-Section 409A)Code, then such payment or benefit required the right to a series of installment payments under this Agreement shall not be paid treated as a right to a series of separate payments.
(vi) With respect to any reimbursement of expenses of, or commence) during the sixany provision of in-month period immediately following kind benefits to, the Executive’s separation from service except , as provided in the immediately following sentence. In specified under this Agreement, such an event, any payments reimbursement of expenses or provision of in-kind benefits that would otherwise have been made or provided during such six-month period and which would have incurred such additional tax under Section 409A shall instead be paid subject to the Executive in a lump-sum cash payment, without interest, on the earlier of following conditions: (iA) the first business day of the seventh month following the Executive’s separation from service or (ii) the 10th business day following the Executive’s death. If the Executive’s termination of employment hereunder does not constitute a “separation from service” within the meaning of Section 409A, then any amounts payable hereunder on account of a termination of the Executive’s employment and which are subject to Section 409A shall not be paid until the Executive has experienced a “separation from service” within the meaning of Section 409A.
(iii) All expenses or other reimbursements as provided herein shall be payable in accordance with the Company’s policies in effect from time to time, but in any event shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by Executive. In addition, no such reimbursement or expenses eligible for reimbursement or the amount of in-kind benefits provided in any one taxable year shall in any way not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year, except for any medical reimbursement arrangement providing for the reimbursement of expenses referred to in Section 105(b) of the Code; (B) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (C) the Executive’s right to reimbursement or in-kind benefits shall not be subject to liquidation or exchanged exchange for another benefit.
(vii) “Termination of employment,” “resignation,” or words of similar import, as used in this Agreement means, for purposes of any payments under this Agreement that are payments of deferred compensation subject to Section 409A of the Code, the Executive’s “separation from service” as defined in Section 409A of the Code.
(viii) If a payment obligation under this Agreement arises on account of the Executive’s separation from service while the Executive is a “specified employee” (as defined under Section 409A of the Code and determined in good faith by the Compensation Committee), any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) that is scheduled to be paid within six months after such separation from service (the aggregate of such scheduled payments, the “Delayed Payment”) shall, in lieu thereof, be paid, as adjusted for earnings or losses thereon, within 15 days after the end of the six-month period beginning on the date of such separation from service or, if earlier, within 15 days after the appointment of the personal representative or executor of the Executive’s estate following his death. In the event that the provisions of this Section 11(l)(viii) shall apply to any payment obligation under this Agreement, and provided that the Executive executes a general release as the Company may request, the Company shall make an irrevocable contribution of an amount equal to the Delayed Payment to a grantor trust established consistent with the terms of Revenue Procedure 92-64, 1992-33 I.R.B. 11 (the “Rabbi Trust”) with a financial institution approved by the Executive, which approval will not be withheld unreasonably, serving as the third-party trustee thereof, under the terms of which the assets of the trust may be used, in the absence of the Company’s insolvency, solely for purposes of fulfilling the Company’s obligation to pay the Delayed Payment to the Executive in compliance with Section 409A(a)(2)(B)(i) of the Code. The Company’s obligation to make the contribution to the Rabbi Trust under the immediately preceding sentence shall arise on the due date of the payment obligation had this Section 11(l)(viii) not applied or, if later, the date that any general release becomes effective, and such contribution shall be made by no later than the tenth business day (excluding federal holidays) after the applicable date. The Executive shall be permitted to direct the trustee how to invest the trust assets held on the Executive’s behalf.
5. In all other respects, the Employment Agreement is hereby ratified and confirmed.
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