Common use of Treatment of Section 280g Clause in Contracts

Treatment of Section 280g. If it is determined that the amounts payable to the Executive under the Agreement, when considered together with any amounts payable to the Executive in connection with a Change in Control, cause such payments to be treated as “excess parachute payments” as defined under Code Section 280G (“Excess Parachute Payments”), and such payments equal an amount that is at least equal to the product of (a) 3.3, multiplied by (b) the “base amount” as defined under Code Section 280G (“Base Amount”), then the Company will make an additional “gross up” payment to the Executive, which shall be in an amount sufficient to pay for any additional tax imposed on the Executive pursuant to Code Section 4999 and any additional interest or penalties imposed on the Executive with respect to such tax, plus the federal, state and local taxes applicable to such additional “gross up” payment. Notwithstanding the foregoing, if it is determined that the amounts payable to the Executive under the Agreement, when considered together with any amounts payable to the Executive in connection with a Change in Control, will cause such payments to be treated as Excess Parachute Payments, but such payments will equal an amount which is less than the product of (x) 3.3, multiplied by (y) the Base Amount, then the payments to the Executive under this Agreement will be reduced to the extent necessary so that no additional tax will be imposed on the Executive pursuant to Code Section 4999.