Section 409a Clause Example from Business Contracts

Section 409a. This Grant Agreement is intended to comply with Section 409A of the Code or an exemption thereunder and shall be construed and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A of the Code. Notwithstanding anything to the contrary, to the extent required to avoid adverse tax consequences under Section 409A of the Code, (a) a Grantee shall not be considered to have terminated employment and no payment or benefit shall be... due to the Grantee under this Grant Agreement until the Grantee would be considered to have incurred a "separation from service" from the Company, parent or subsidiary thereof within the meaning of Section 409A of the Code and (b) if the Grantee is a "specified employee" (as defined in Section 409A of the Code), amounts that would otherwise be payable and benefits that would otherwise be provided due to the Grantee's separation from service under this Grant Agreement during the six-month period immediately following the Grantee's separation from service shall instead be paid or provided on the first business day after the date that is six months following the Grantee's separation from service (or, if earlier, on the date of the Grantee's death or such earlier date as may be permitted under Section 409A of the Code). Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Grant Agreement comply with Section 409A of the Code 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 Grantee on account of non- compliance with Section 409A of the Code. View More