280G Cutback. Notwithstanding any provision of the Agreement to the contrary, if it shall be determined that any benefit provided to the Executive or payment or distribution by or for the account of the Company to or for the benefit of the Executive, whether provided, paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise the Executive would receive from the Company under the Agreement or otherwise in connection with a Change in Control (each, a “Payment”) (i) constitutes a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this Section 10, would be subject to the excise tax imposed by Section 4999 of the Code, then the Executive will be entitled to receive either (x) the full amount of the Payments or (y) a portion of the Payments having a value equal to the Safe Harbor Amount, whichever of (x) and (y), after taking into account applicable federal, state, and local income taxes and the excise tax imposed by Section 4999 of the Code, results in the receipt by the Executive on an after-tax basis, of the greatest portion of the Payments. Any determination required under this Section 10 shall be made in writing by the Company’s independent, certified public accounting firm or such other certified public accounting firm as may be designated by the Company prior to the Change in Control (the “Accounting Firm”), whose determination shall be conclusive and binding for all purposes upon the Company and the Executive. For purposes of making the calculations required by this Section 10, the Accounting Firm may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good-faith interpretations concerning the application of Sections 280G and 4999 of the Code. If there is a reduction pursuant to this Section 10 of the Payments to be delivered to the Executive, such payments shall be reduced to the extent necessary to avoid application of the excise tax in the following order: (i) any cash severance based on a multiple of Base Salary or Annual Bonus, (ii) any other cash amounts payable to the Executive, (iii) benefits valued as parachute payments, and (iv) acceleration of vesting of any equity awards. The following terms shall have the following meanings for purposes of Section 10.
Appears in 20 contracts
Samples: Employment Agreement (Masonite International Corp), Employment Agreement (Masonite International Corp), Employment Agreement (Masonite International Corp)