Section 280G Clause Example with 13 Variations from Business Contracts

Section 280G. (a) In the event that Holdco or the Company undergoes a "change in ownership or control" (within the meaning of Section 280G of the Code) after Holdco, the Company or any affiliate of Holdco or the Company (including PGA) that would be treated, together with Holdco or the Company, as a single corporation under Section 280G of the Code and the regulations thereunder has stock that is readily tradeable on an established securities market or otherwise (within the meaning of Section 280G of the Code... and guidance promulgated thereunder ("Section 280G")) the regulations thereunder) and all, or any portion, of the payments provided under this Agreement, either alone or together with other payments or benefits which the Executive Employee receives or is entitled to receive from Holdco, the Company, PGA or any affiliate of Holdco, the Company or PGA (collectively, the "Total Payments"), could constitute an "excess parachute payment" within the meaning of Section 280G, 280G of the Code, then the Executive Employee shall be entitled to receive (i) an amount limited (to the minimum extent necessary) so that no portion of the Total Payments shall be non-deductible for US federal income taxes by reason of Section 280G of the Code (the "Limited Amount"), or (ii) if the amount of the Total Payments (without regard to clause (i)) reduced by the excise tax imposed by Section 4999 of the Code (the "Excise Tax") and the amount of all other applicable federal, state and local taxes (with income taxes all computed at the highest applicable marginal rate) is greater than the Limited Amount reduced by the amount of all taxes applicable thereto (with income taxes all computed at the highest marginal rate), the amount of the Total Payments otherwise payable without regard to clause (i). If it is determined that the Limited Amount will maximize the Employee's after-tax proceeds, the Total Payments shall be reduced to equal the Limited Amount in the following order: (i) first, by reducing cash severance payments that are exempt from Section 409A, 409A of the Code, (ii) second, by reducing other payments and benefits that are exempt from Section 409A of the Code and to which Q&A 24(c) of Section 1.280G-1 of the Treasury Regulations does not apply, (iii) third, by reducing all remaining payments and benefits that are exempt from Section 409A of the Code and (iv) finally, by reducing payments and benefits that are subject to Section 409A, 409A of the Code, in each case, with all such reductions done on a pro rata basis. 12 (b) All determinations made pursuant this Section 14 25 will be made at the Company's or its Affiliates' affiliates' expense by an accounting firm or consulting group with experience in performing calculations regarding the applicability of Section Sections 280G and Section 4999 of the Code selected by the Company for such purpose (the "Independent Advisors"). For purposes of such determinations, no portion of the Total Payments shall be taken into account which, in the opinion of the Company and its legal advisors, (y) does not constitute a 19 "parachute payment" within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) or (z) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the "base amount" (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation. In the event it is later determined that (A) a greater reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, 25, the excess amount shall be returned immediately by the Executive Employee to the Company or (B) a lesser reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, 25, the additional amount shall be paid immediately by Holdco, the Company, PGA or any Affiliate affiliate of Holdco, the Company, Company or PGA, as applicable, to the Executive. Employee. [The remainder of this page is intentionally left blank.] View More

Section 280G. (a) In the event that the Company undergoes a "change in ownership or control" (within the meaning of Section 280G of the Code and the regulations and guidance promulgated thereunder ("Section 280G")) and all, or any portion, of the payments provided under this Agreement, either alone or together with other payments or benefits which the Executive receives or is entitled to receive from the Company (collectively, the "Total Payments"), could constitute an "excess parachute payment" within the me...aning of Section 280G, then the Executive shall be entitled to receive (i) an amount limited (to the minimum extent necessary) so that no portion of the Total Payments shall be non-deductible for US federal income taxes by reason of Section 280G (the "Limited Amount"), or (ii) if the amount of the Total Payments (without regard to clause (i)) reduced by the excise tax imposed by Section 4999 of the Code (the "Excise Tax") and the amount of all other applicable federal, state and local taxes (with income taxes all computed at the highest applicable marginal rate) is greater than the Limited Amount reduced by the amount of all taxes applicable thereto (with income taxes all computed at the highest marginal rate), the amount of the Total Payments otherwise payable without regard to clause (i). If it is determined that the Limited Amount will maximize the Employee's after-tax proceeds, the Total Payments shall be reduced to equal the Limited Amount in the following order: (i) first, by reducing cash severance payments that are exempt from Section 409A, (ii) second, by reducing other payments and benefits that are exempt from Section 409A and to which Q&A 24(c) of Section 1.280G-1 of the Treasury Regulations does not apply, (iii) third, by reducing all remaining payments and benefits that are exempt from Section 409A and (iv) finally, by reducing payments and benefits that are subject to Section 409A, in each case, with all such reductions done on a pro rata basis. 12 (b) All determinations made pursuant this Section 14 13 will be made at the Company's or its Affiliates' expense by an accounting firm or consulting group with experience in performing calculations regarding the applicability of Section 280G and Section 4999 of the Code selected by the Company for such purpose (the "Independent Advisors"). For purposes of such determinations, no portion of the Total Payments shall be taken into account which, in the opinion of the Company and its legal advisors, (y) does not constitute a "parachute payment" within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) or (z) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the "base amount" (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation. In the event it is later determined that (A) a greater reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, 13, the excess amount shall be returned immediately by the Executive to the Company or (B) a lesser reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, 13, the additional amount shall be paid immediately by the Company, or any Affiliate of the Company, as applicable, to the Executive. 13 14. Assignment. Neither the Company nor the Executive may make any assignment of this Agreement or any interest herein, by operation of law or otherwise, without the prior written consent of the other; provided, however, that (a) the Company may assign its rights and obligations under this Agreement without the consent of the Executive to one of its Affiliates, or in the event that the Company shall hereafter effect a reorganization with, consolidate with, or merge into, an Affiliate or any person or transfer or have transferred all or substantially all of its properties, outstanding stock, or assets to an Affiliate or any person and (b) in the event that all of the Company's rights and obligations under this Agreement are assigned pursuant to this Section 14, each reference to Company herein shall be deemed from and after such assignment instead to be a reference to the assignee. This Agreement shall inure to the benefit of and be binding upon the Company and the Executive, and their respective successors, executors, administrators, heirs and permitted assigns. View More

Section 280G. (a) In the event that the Company or Parent undergoes a "change in ownership or control" (within the meaning of Section 280G of the Code and the regulations and guidance promulgated thereunder ("Section 280G")) before the Company or Parent or any Affiliate of the Company or Parent that would be treated, together with the Company or Parent, as a single corporation under Section 280G has stock that is readily tradeable on an established securities market or otherwise (within the meaning of Section... 280G) and all, or any portion, of the payments provided under this Agreement, either alone or together with other payments or benefits which the Executive receives or is entitled to receive from the Company or Parent (collectively, the "Total Payments"), could constitute an "excess parachute payment" within the meaning of Code Section 280G, the Company will use its reasonable best efforts to seek shareholder approval of the Total Payments in a manner that satisfies the requirements of the "shareholder approval" exception to Section 280G, such that, if approved, all Total Payments may be made to the Executive without the application of the excise tax imposed by Section 4999 of the Code. (b) In the event that the Company or Parent undergoes a "change in ownership or control" (within the meaning of Section 280G) before the Company or Parent or any Affiliate of the Company or Parent that would be treated, together with the Company or Parent, as a single corporation under Section 280G has stock that is readily tradeable on an established securities market or otherwise (within the meaning of Section 280G) and all, or any portion, of the Total Payments could constitute an "excess parachute payment" within the meaning of Section 280G, then the Executive shall be entitled to receive (i) an amount limited (to the minimum extent necessary) so that no portion of the Total Payments shall be non-deductible for US federal income taxes by reason of Section 280G (the "Limited Amount"), or (ii) if the amount of the Total Payments (without regard to clause (i)) reduced by the excise tax imposed by Section 4999 of the Code (the "Excise Tax") and the amount of all other applicable federal, state and local taxes (with income taxes all computed at the highest applicable marginal rate) is greater than the Limited Amount reduced by the amount of all taxes applicable thereto (with income taxes all computed at the highest marginal rate), the amount of the Total Payments otherwise payable without regard to clause (i). If it is determined that the Limited Amount will maximize the Employee's after-tax proceeds, the Total Payments shall be reduced to equal the Limited Amount in the following order: (i) first, by reducing cash severance payments that are exempt from Section 409A, (ii) second, by reducing other payments and benefits that are exempt from Section 409A and to which Q&A 24(c) of Section 1.280G-1 of the Treasury Regulations does not apply, (iii) third, by reducing all remaining payments and benefits that are exempt from Section 409A and (iv) finally, by reducing payments and benefits that are subject to Section 409A, in each case, with all such reductions done on a pro rata basis. 12 (b) All determinations made pursuant this Section 14 will be made at the Company's or its Affiliates' expense by an accounting firm or consulting group with experience in performing calculations regarding the applicability of Section 280G and Section 4999 of the Code selected by the Company for such purpose (the "Independent Advisors"). For purposes of such determinations, no portion of the Total Payments shall be taken into account which, in the opinion of the Company and its legal advisors, (y) does not constitute a "parachute payment" within the meaning of Section 280G(b)(2) of the Code (including by reason of Section 280G(b)(4)(A) of the Code) or (z) constitutes reasonable compensation for services actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of the "base amount" (as defined in Section 280G(b)(3) of the Code) allocable to such reasonable compensation. In the event it is later determined that (A) a greater reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, the excess amount shall be returned immediately by the Executive to the Company or (B) a lesser reduction in the Total Payments should have been made to implement the objective and intent of this Section 14, the additional amount shall be paid immediately by Parent, the Company, or any Affiliate of Parent or the Company, as applicable, to the Executive. View More