CLAWBACK INDEMNITY Sample Clauses
A Clawback Indemnity clause requires a party to return or reimburse funds or benefits previously received if certain conditions are later triggered, such as a breach of contract or the discovery of misrepresentation. In practice, this clause may apply to bonuses paid to executives, commissions to agents, or other financial incentives, obligating repayment if the original basis for the payment is invalidated. Its core function is to protect the paying party from losses due to wrongful or premature payments, ensuring that financial incentives are only retained when all contractual obligations are properly fulfilled.
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CLAWBACK INDEMNITY. In the event that, as a result of the Executive’s employment by the Company in accordance with the terms of this Agreement, or any action taken by the Executive in connection with his employment by the Company (provided that such action does not constitute a willful violation of any of the provisions of Section 22), the Executive is subject to, and the former employer has made a demand for, the forfeiture of previously vested equity incentive awards, or the Executive is required to repay to his former employer the value of any previously vested equity incentive award that was previously sold by the Executive (a “Clawback”), the Company shall pay to the Executive an amount equal to the sum of the amount that Executive is required to repay to his former employer plus the amount paid by the Executive for any previously vested equity incentive award that is forfeited (the “Clawback Reimbursement”), plus, if the total amount of additional state and federal income and social security tax payable by Executive by reason of receipt of the Clawback Reimbursement, after taking into account any deduction to which the Executive is entitled by reason of the Clawback, is greater than zero, the Company shall pay to the Executive an amount equal to such additional tax, grossed-up for any tax payable by reason of such amount (the “Clawback Gross-up”), provided that in no event shall the sum of the Clawback Reimbursement and the Clawback Gross-up exceed Four Million Dollars ($4,000,000.00). If the Executive’s employment by the Company is terminated by the Company for Cause, prior to the third anniversary of the Effective Date, the Executive shall promptly repay to the Company, upon demand, an amount equal to the sum of the Clawback Reimbursement and Clawback Gross-up previously received. If the Executive’s employment by the Company is terminated by the Executive without Good Reason, prior to the third anniversary of the Effective Date, the Executive shall not be entitled to any additional Clawback Reimbursement or Clawback Gross-up, and shall promptly repay to the Company, upon demand, an amount equal to the sum of the Clawback Reimbursement and Clawback Gross-up previously received multiplied by a fraction, the numerator of which is thirty-six minus the number of full months that have elapsed between the Effective Date and the date of termination, and the denominator of which is thirty-six. The Executive shall in good faith work with the Company and his former employer to p...