Common use of Adjustment in Benefits Clause in Contracts

Adjustment in Benefits. In the event that Executive becomes entitled to the payments and benefits described in this Section 6 (together with any other benefits to which Executive is entitled hereunder following a termination entitling Executive to the payments and benefits of this Section 6, the “Severance Benefits”), if (x) the Severance Benefits equal or exceed 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Company shall pay to Executive an additional amount (the “Gross-Up Payment”) equal to the sum of any excise tax imposed under Section 280G of the Code (“Excise Tax”) on Executive by reason of receiving the Severance Benefits plus the amount necessary to place Executive in the same after-tax position (taking into account any and all applicable federal, state and local excise, income and other taxes on the Gross-Up Payment) as if no Excise Tax had been imposed on the Severance Befits and no Gross-Up Payment had been made to Executive, and if (y) the Severance Benefits are less than 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Severance Benefits shall be limited to no more than 2.99 times Executive’s “base amount” determined for purposes of Section 280G of the Code. For purposes of determining whether any of the Severance Benefits will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by Executive in connection with a Change in Control or Executive’s termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with TNS, any person whose actions result in a change in control or any person affiliated with the Company or such person) shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by TNS’ independent auditors and reasonably acceptable to Executive such other payments or benefits (in whole or in part) do not constitute parachute payments, including without limitation by reason of Section 280G(b)(4)(A) of the Code, or such excess parachute payments (in whole or in part) represent 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, or are otherwise not subject to the Excise Tax, (ii) the amount of the Severance Benefits that shall be treated as subject to the Excise Tax shall be equal to the lesser of (a) the total amount of the Severance Benefits or (b) the amount of excess parachute payments within the meaning of Section 280G(b)(1) of the Code (after applying clause (i) above), and (iii) the value of all non-cash benefits or any deferred payment or benefit shall be determined by TNS’ independent auditors in accordance with the principles of Section 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of his residence on the date of termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder in the computation of the Gross-Up Payment, Executive shall repay to the Company (without interest), at the time that the amount of such reduction in Excise Tax is finally determined, the portion of the Gross-Up Payment attributable to such reduction (plus that portion of the Gross-Up Payment attributable the Excise tax and federal, state and local income and employment tax imposed on the portion of the Gross-Up Payment being repaid by Executive to the extent that such repayment results in a reduction in the Excise Tax and/or in a federal, state or local income or employment tax deduction). In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time of the computation of the Gross-Up Payment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up payment), the Company shall make an additional Gross-Up Payment in respect of such excess (plus any interest, penalties or additions payable by Executive with respect to such excess) at the time that the amount of such excess is finally determined. Executive and TNS shall each reasonably cooperate with the other in connection with any administrative or judicial proceedings concerning the existence or amount of liability for Excise Tax with respect to the Severance Benefits.

Adjustment in Benefits. In the event that Executive becomes entitled to the payments and benefits described in this Section 6 (together with any other benefits to which Executive is entitled hereunder following a termination entitling Executive to the payments and benefits of this Section 6, the “Severance Benefits”), if (x) the Severance Benefits equal or exceed 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Company shall pay to Executive an additional amount (the “Gross-Up Payment”) equal to the sum of any excise tax imposed under Section 280G of the Code (“Excise Tax”) on Executive by reason of receiving the Severance Benefits plus the amount necessary to place Executive in the same after-tax position (taking into account any and all applicable federal, state and local excise, income and other taxes on the Gross-Up Payment) as if no Excise Tax had been imposed on the Severance Befits Benefits and no Gross-Up Payment had been made to Executive, and if (y) the Severance Benefits are less than 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Severance Benefits shall be limited to no more than 2.99 times Executive’s “base amount” determined for purposes of Section 280G of the Code. For purposes of determining whether any of the Severance Benefits will be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by Executive in connection with a Change in Control or Executive’s termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with TNSthe Company, any person whose actions result in a change in control or any person affiliated with the Company or such person) shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by TNSthe Company’ independent auditors and reasonably acceptable to Executive such other payments or benefits (in whole or in part) do not constitute parachute payments, including without limitation by reason of Section 280G(b)(4)(A) of the Code, or such excess parachute payments (in whole or in part) represent 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, or are otherwise not subject to the Excise Tax, (ii) the amount of the Severance Benefits that shall be treated as subject to the Excise Tax shall be equal to the lesser of (a) the total amount of the Severance Benefits or (b) the amount of excess parachute payments within the meaning of Section 280G(b)(1) of the Code (after applying clause (i) above), and (iii) the value of all non-cash benefits or any deferred payment or benefit shall be determined by TNSthe Company’ independent auditors in accordance with the principles of Section 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of his residence on the date of termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder in the computation of the Gross-Up Payment, Executive shall repay to the Company (without interest), at the time that the amount of such reduction in Excise Tax is finally determined, the portion of the Gross-Up Payment attributable to such reduction (plus that portion of the Gross-Up Payment attributable the Excise tax and federal, state and local income and employment tax imposed on the portion of the Gross-Up Payment being repaid by Executive to the extent that such repayment results in a reduction in the Excise Tax and/or in a federal, state or local income or employment tax deduction). In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time of the computation of the Gross-Up Payment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up payment), the Company shall make an additional Gross-Up Payment in respect of such excess (plus any interest, penalties or additions payable by Executive with respect to such excess) at the time that the amount of such excess is finally determined. Executive and TNS the Company shall each reasonably cooperate with the other in connection with any administrative or judicial proceedings concerning the existence or amount of liability for Excise Tax with respect to the Severance Benefits.

Adjustment in Benefits. In the event that Executive becomes entitled to the payments and benefits described in this Section 6 (together with any other benefits to which Executive is entitled hereunder following a termination entitling Executive to the payments and benefits of this Section 6, the “Severance Benefits”), if (x) the Severance Benefits equal or exceed 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Company shall pay to Executive an additional amount (the “Gross-Up Payment”) equal to the sum of any excise tax imposed under Section 280G of the Code (“Excise Tax”) on Executive by reason of receiving the Severance Benefits plus the amount necessary to place Executive in the same after-tax position (taking into account any and all applicable federal, state and local excise, income and other taxes on the Gross-Up Payment) as if no Excise Tax had been imposed on the Severance Befits and no Gross-Up Payment had been made to Executive, and if (y) the Severance Benefits are less than 110% of three times Executive’s “base amount” determined for purposes of Section 280G of the Code, the Severance Benefits shall be limited reduced, in a manner to no more than 2.99 times Executive’s “base amount” be determined for purposes of Section 280G by TNS in its sole discretion, by the amount necessary to avoid the imposition of the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”) on excess parachute payments (the “Excise Tax”). For purposes of determining whether any of the Severance Benefits will would otherwise be subject to the Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits received or to be received by Executive that would be treated as contingent on a change in connection with a Change ownership or control under the principles described in Control Treas. Reg. § 1.2806-1 P-22 or that are otherwise payable on account of Executive’s termination of employment (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with TNS, any person whose actions result in a change in control or any person affiliated with the Company or such person) shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by TNS’ independent auditors and reasonably acceptable to Executive such other payments or benefits (in whole or in part) do not constitute parachute payments, including without limitation by reason of Section 280G(b)(4)(A) of the Code, or such excess parachute payments (in whole or in part) represent 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, or are otherwise not subject to the Excise Tax, (ii) the amount of the Severance Benefits that shall be treated as subject to the Excise Tax shall be equal to the lesser of (a) the total amount of the Severance Benefits or (b) the amount of excess parachute payments within the meaning of Section 280G(b)(1) of the Code (after applying clause (i) above), and (iii) the value of all non-cash benefits or any deferred payment or benefit shall be determined by TNS’ independent auditors in accordance with the principles of Section 280G(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of his residence on the date of termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder in the computation of the Gross-Up Payment, Executive shall repay to the Company (without interest), at the time that the amount of such reduction in Excise Tax is finally determined, the portion of the Gross-Up Payment attributable to such reduction (plus that portion of the Gross-Up Payment attributable the Excise tax and federal, state and local income and employment tax imposed on the portion of the Gross-Up Payment being repaid by Executive to the extent that such repayment results in a reduction in the Excise Tax and/or in a federal, state or local income or employment tax deduction). In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time of the computation of the Gross-Up Payment (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up payment), the Company shall make an additional Gross-Up Payment in respect of such excess (plus any interest, penalties or additions payable by Executive with respect to such excess) at the time that the amount of such excess is finally determined. Executive and TNS shall each reasonably cooperate with the other in connection with any administrative or judicial proceedings concerning the existence or amount of liability for Excise Tax with respect to the Severance Benefits.