Effect of Section 280G. (a) Notwithstanding the foregoing, in the event that it shall be determined that any payment in the nature of compensation (within the meaning of section 280G(b)(2) of the Internal Revenue Code of 1986, as amended (“Code”)) to or for the benefit of Executive, whether paid or payable pursuant to the terms of this Retention Plan Agreement or otherwise (the “Payments”), would constitute an “excess parachute payment” within the meaning of section 280G of the Code, the Company shall reduce (but not below zero) the aggregate present value of the Payments under this Retention Plan Agreement to the Reduced Amount (as defined below), if but only if reducing the Payments under this Retention Plan Agreement will provide Executive with a greater net after-tax amount than would be the case if no reduction was made. The Payments shall be reduced as described in the preceding sentence only if (A) the net amount of the Payments, as so reduced (and after subtracting the net amount of federal, state and local income and payroll taxes on the reduced Payments), is greater than or equal to (B) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax (as defined below) to which Executive would be subject with respect to the unreduced Payments). Only amounts payable under this Retention Plan Agreement shall be reduced pursuant to this subsection (a).
Appears in 6 contracts
Samples: Retention Plan Agreement (Eurand N.V.), Retention Plan Agreement (Eurand N.V.), Retention Plan Agreement (Eurand N.V.)
