Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b. a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b. b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a, Employer also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICA. c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b.
Appears in 7 contracts
Samples: Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp)
Gross-Up Payment. The Employee shall be entitled to a “"Gross-Up Payment “ " under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b7.04.2.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “"Payments”") pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s his/her employment with the Employer or a change Change of control Control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee the Executive with respect to such Excise Tax, then the Employee will be entitled to receive an additional payment (“"Gross-Up Payment”") in an amount equal to the total Excise Tax, interest and penalties imposed on the Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section section 7.04.2.b.
b. If the Employer is obligated to pay the Employee pursuant to Section 7.04.2.a, the Employer also shall pay the Employee an amount equal to the “"total presumed federal and state taxes” " that could be imposed on the Employee with respect to the Excise Tax reimbursements due to the Employee pursuant to Section 7.04.2.a and the federal and state tax reimbursements due to the Employee pursuant to this section. For purposes of the preceding sentence, the “"total presumed federal and state taxes” " that could be imposed on the Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under (Employee) Federal tax law applicable to Employee and (ii) the tax laws of the state in which the Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “"penalty” " taxes (in addition to the Excise Tax in section 7.04.2.a) imposed applicable federal tax law, by Congress or the Internal Revenue Service that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b.
Appears in 6 contracts
Samples: Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 7.05.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 7.05.2.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer the Bank or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b7.05.2.b.
b. If Employer the Bank is obligated to pay Employee pursuant to Section 7.04.2.a7.05.2.a, Employer the Bank shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 7.05.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a7.05.2.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b7.05.2.b.
Appears in 6 contracts
Samples: Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable Executive becomes entitled to the Employee Severance Benefits or any other benefits or payments under this Agreement (hereinafter referred other than pursuant to as “Payments”this Section) by reason of the accelerated vesting of stock options thereunder (together, the "Total Benefits"), and in the event that any of the Total Benefits will be subject to the Excise Tax, the Company shall pay to the Executive an additional amount (the "Gross-Up Payment") such that the net amount retained by the Executive, after deduction of any Excise Tax on the Total Benefits and any federal, state and local income tax, Excise Tax and FICA and Medicare withholding taxes upon the payment provided for by this Section, shall be equal to the Total Benefits. For purposes of determining whether any of the Total 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 the Executive in connection with a Change in Control or the Executive's termination of employment (whether pursuant to the terms of this Agreement or any other agreement, plan or arrangement with the 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 Cod, and all "excess parachute payments" within the meaning the Section 280G(b)(1) shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel ("Tax Counsel") selected by the Company's independent auditors and acceptable to the Executive, such other payments or benefits (in whole or in part) do not constitute parachute payments, 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) of the Code in excess of the Base Amount, or are otherwise in connection with or arising out not subject to the Excise Tax, (ii) the amount of Employee’s employment with Employer or a change of control would the Total Benefits which shall be treated as subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will shall be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the lesser of (A) the total Excise Tax, interest and penalties imposed on Employee as a result amount of the Total Benefits reduced by the amount of such Total Benefits that in the opinion of Tax Counsel are not parachute payments, or (B) the amount of excess parachute payments within the meaning of Section 280G(b)(1) (after applying clause (i), above), and (iii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Company's independent auditors in accordance with the principles of sections 280G(d)(3) and (4) of the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a, Employer also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a and the federal and state tax reimbursements due to Employee pursuant to this sectionCode. For purposes of determining the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a) imposed applicable federal tax law, that these taxes would also be included in the calculation amount of the Gross-Up Payment, including any the 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 tax reimbursements pursuant to section 7.04.2.b.and local income taxes at the highest marginal rate of taxation in the state and locality of the
Appears in 5 contracts
Samples: Termination Agreement (Petroquest Energy Inc), Termination Agreement (Petroquest Energy Inc), Termination Agreement (Petroquest Energy Inc)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 8.01.4.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 8.01.4.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code Code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b8.01.4.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a8.01.4.a, Employer shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 8.01.4.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a8.01.4.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b8.01.4.b.
5. Determination of Eligibility for and Amount of Gross-Up Payment: An initial determination as to whether a Gross-Up Payment is required pursuant to this Agreement and the amount of such Gross-Up Payment shall be made at Employer’s expense by an accounting firm appointed by Employer prior to any Change of Control. The accounting firm shall provide its determination, together with detailed supporting calculations and documentation to Employer and Employee prior to submission of the proposed Change of Control to Employer’s or Bancorp’s shareholders, Board of Directors or appropriate regulators for approval. If the accounting firm determines that no Excise Tax is payable by Employee with respect to a Payment or Payments, it shall furnish Employee with an opinion reasonably acceptable to Employee that no Excise Tax will be imposed with respect to any such Payment or Payments. Within ten (10) days of the delivery of the determination to Employee, Employee shall have the right to dispute the determination. The existence of the dispute shall not in any way affect Employee’s right to receive the Gross-Up Payment in accordance with the determination. Upon the final resolution of a dispute, Employer or its successor shall promptly pay to Employee any additional amount required by such resolution. If there is no dispute, the determination shall be binding, final and conclusive upon Employer and Employee, except to the extent that any taxing authority subsequently makes a determination that the Excise Tax or additional Excise Tax is due and owing on the payments made to Employee. If any taxing authority determines that the Excise Tax or additional Excise Tax is due and owing, Employer or the entity acquiring control of Employer shall pay the Excise Tax and any penalties assessed by such taxing authority.
Appears in 4 contracts
Samples: Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp)
Gross-Up Payment. Employee If any of the payments made to Executive under this Section 4.B ("payments") will be subject to the tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code") the ("Excise Tax"), (and/or any similar tax that may be imposed by federal, state or local law), the Company shall be entitled pay to a “Grossthe Executive an additional amount (the "gross-Up Payment “ under up payment") equal to the terms and conditions set forth herein, and such payment shall include sum of (x) the Excise Tax reimbursement due pursuant to section 7.04.2.a imposed on the payments, (y) the Excise Tax imposed on the gross-up payment, and (z) the federal, state and local income taxes imposed upon the gross-up payment. The gross-up payment shall be made within 45 days after the date of termination. For purposes of determining whether any federal and state tax reimbursements due pursuant to section 7.04.2.b.
a. In of the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable payments will be subject to the Employee Excise Tax and the amount of such Excise Tax, any other payments or benefits received or to be received by the Executive in connection with a Change in Control or the Executive's termination (hereinafter referred to as “Payments”) whether pursuant to the terms of this Agreement or otherwise any other plan, arrangement or agreement with the Company, any person whose actions result in connection a Change in Control or any person affiliated with the Company or arising out such person) shall be treated as "parachute payments" within the meaning of Employee’s employment with Employer or a change Section 280G(b)(2) of control would the Code, and all "excess parachute payments" within the meaning of Section 280G(b)(1) shall be treated as subject to the Excise Tax imposed Tax, unless in the opinion of tax counsel selected by the Company and acceptable to the Executive, such other payments or benefits (in whole or in part) do not constitute parachute payments, or such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of Section 4999 280G(b)(4) of the Internal Revenue code Code, or are otherwise not subject to the Excise Tax. For purposes of determining the amount of the gross-up payment, the Executive shall be deemed to pay federal, state and local income taxes at the highest marginal rate of federal, state and local income taxation in the calendar year in which the gross-up payment is to be made in the state and locality of the Executive's residence on the date of termination, net of the maximum reduction in federal income taxes which could be obtained from deduction of any state and local income taxes. In the event that the Excise Tax is subsequently determined to be less than the amount used to calculate the gross-up payment, the Executive shall repay to the Company at the time that the reduction in Excise Tax is finally determined the portion of the gross-up payment attributable to such reduction, plus interest on the amount of such repayment at the rate provided in Section 7872(f)(2) of the Code. In the event that the Excise Tax is determined to exceed the amount used to calculate 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 or penalties are incurred by Employee payable with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”excess) in an amount equal to at the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a, Employer also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides on the date time that the payment amount of such excess is computed and (b) the hospital insurance portion of FICAfinally determined.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b.
Appears in 3 contracts
Samples: Employment Agreement (Infocure Corp), Employment Agreement (Infocure Corp), Employment Agreement (Infocure Corp)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b.
a. (a) In the event that (i) Xxxxx becomes entitled to any payment benefits or benefit (as those terms are defined within payments in connection with the meaning termination of Internal Revenue Code Section 280G(b)(2)) paidXxxxx'x employment, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) whether pursuant to the terms of this Agreement or otherwise in connection with or arising out otherwise, including without limitation the Severance Benefits (collectively, the "Total Benefits"), and (ii) any of Employee’s employment with Employer or a change the Total Benefits will be subject to the Excise Tax, RAI shall pay to Xxxxx an additional amount (the "Gross-Up Payment") such that the net amount retained by Xxxxx, after deduction of control would any Excise Tax on the Total Benefits and any federal, state and local income taxes, Excise Tax, and FICA and Medicare withholding taxes upon the payment provided for by this paragraph 8(a), shall be equal to the Total Benefits. For purposes of determining whether any of the Total Benefits will be subject to the Excise Tax imposed by Section 4999 and the amount of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an the amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements Total Benefits that shall be treated as set forth in Section 7.04.2.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a, Employer also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect subject to the Excise Tax reimbursements due shall be equal to Employee pursuant the amount of the Total Benefits reduced by the amount of such Total Benefits that, in the opinion of tax counsel selected by Xxxxx, at RAI's expense and reasonably acceptable to RAI ("Tax Counsel"), are not excess parachute payments (within the meaning of Section 7.04.2.a and 28OG(b)(1) of the federal and state tax reimbursements due to Employee pursuant to this section. Code).
(b) For purposes of this Section 8, Xxxxx shall be deemed to pay federal income taxes at the preceding sentence, highest marginal rate of federal income taxation in the “total presumed federal calendar year in which the Excise Tax is (or would be) payable and state taxes” that and local income taxes at the highest marginal rate of taxation in the state and locality of Xxxxx'x residence on the Date of Termination, net of the reduction in federal income taxes which could be imposed on Employee shall be conclusively obtained from deduction of such state and local taxes (calculated using a combined tax rate equal to the sum by assuming that any reduction under Section 68 of the (a) Code in the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss amount of itemized deductions or exemptionsallowable to Xxxxx applies first to reduce the amount of such state and local income taxes that would otherwise be deductible by Xxxxx). Except as otherwise provided herein, or for any other purpose for paying the actual taxes. It is further intended that in all determinations required to be made under this Section 8 shall be made by Tax Counsel.
(c) In the event that any payments would the Excise Tax is subsequently determined to be subject less than the amount taken into account hereunder at the time of termination of Xxxxx'x employment, Xxxxx shall repay to other “penalty” taxes RAI, 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 (in addition plus that portion of the Gross-Up Payment attributable to the Excise Tax, federal, state and local income taxes and FICA and Medicare withholding taxes imposed on the Gross-Up Payment being repaid by Xxxxx to the extent that such repayment results in a reduction in Excise Tax, FICA and Medicare withholding taxes and/or a federal, state or local income tax deduction) plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax in section 7.04.2.a) imposed applicable federal tax law, that these taxes would also is determined to exceed the amount taken into account hereunder at the time of the termination of Xxxxx'x employment (including by reason of any payment the existence or amount of which cannot be included in determined at the calculation time of the Gross-Up Payment), including RAI shall make an additional Gross-Up Payment to Xxxxx in respect of such excess (plus any federal and state tax reimbursements pursuant interest, penalties or additions payable by Xxxxx with respect to section 7.04.2.bsuch excess) at the time that the amount of such excess is finally determined.
Appears in 2 contracts
Samples: Employment Agreement (Resource America Inc), Employment Agreement (Resource America Inc)
Gross-Up Payment. Employee shall be entitled to a (a) Notwithstanding the above, if any of the compensation payable upon termination of Employee’s employment as provided for above (the “Gross-Up Payment “ under Payments”) triggers the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning application of Internal Revenue Code Section 280G(b)(2280G, or makes Employee liable for payment of the excise tax (the “Excise Tax”) provided for under Section 4999 of the Code, or any other statute or regulation under which Employee may be penalized as a result of the nature or amount of such compensation, then Employer or the acquiring or successor entity of Employer shall pay to Employee an additional amount (the “Gross-Up”) such that the net after-tax amount retained by the Employee, after deduction of (X) any Excise Tax on the Payments, and (Y) any federal, state, local or foreign income, employment or other tax and Excise Tax upon any payment provided for by this Section 2(h)) paid, payable, distributed or distributable shall be equal to the Payments, reduced by the amount of any United States federal, state and local income or employment tax liability of the Employee (hereinafter referred to calculated as “Payments”) pursuant if the Payments were not subject to the terms Excise Tax. The determination of this Agreement or otherwise in connection with or arising out whether any of Employee’s employment with Employer or a change of control would the Payments will be subject to the Excise Tax imposed by Section 4999 and the amount of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee Tax will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.bmade by Employer’s regular independent public accounting firm.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a, Employer also shall pay Employee an amount equal to (b) In the “total presumed federal and state taxes” event that could be imposed on Employee with respect to the Excise Tax reimbursements due is subsequently determined to Employee pursuant to be less than the amount taken into account under this Section 7.04.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence2(h), the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate repay to Employer at the time that the amount of such reduction of Excise Tax is finally determined, an amount equal to the sum of the following: (ai) the highest individual income tax rate amount of the reduction of the Excise Tax, (ii) the amount of the reduction in effect under Federal tax law applicable to Employee all other taxes generated by the reduction in the Excise Tax, and (iii) interest on the amount of the sum of (i) and (ii) at the tax laws rate provided in Section 1274(b)(2)(B) of the state in which Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICACode.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in (c) In the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.ais determined to exceed the amount previously taken into account under the Section 2(h) imposed applicable federal tax law, that these taxes would also (including by reason of any payment the existence or amount of which cannot be included in determined at the calculation time of the Gross-Up), Employer shall make an additional Gross-Up Payment, including payment in respect to such excess (plus any federal and state tax reimbursements pursuant interest payable with respect to section 7.04.2.bsuch excess) at the time that the amount of such excess is finally determined in accordance with the principles set forth above.
Appears in 2 contracts
Samples: Employment Agreement (Neah Power Systems, Inc.), Employment Agreement (Hythiam Inc)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 8.01.4.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 8.01.4.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code Code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b8.01.4.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a8.01.4.a, Employer shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 8.01.4.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a8.01.4.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b8.01.4.b.
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Samples: Employment Agreement (Farmers & Merchants Bancorp), Employment Agreement (Farmers & Merchants Bancorp)
Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a 6.04.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.b6.04.2.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b6.04.2.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a6.04.2.a, Employer also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 6.04.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a6.04.2.a) imposed under applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b6.04.2.b.
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Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 7.05.2.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 7.05.2.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b7.05.2.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a7.05.2.a, Employer shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 7.05.2.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a7.05.2.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b7.05.2.b.
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Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 8.01.3.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 8.01.3.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code Code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b8.01.3.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a8.01.3.a, Employer shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 8.01.3.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a8.01.3.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b8.01.3.b.
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Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 7.05.3.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 7.05.3.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer the Bank or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b7.05.3.b.
b. If Employer the Bank is obligated to pay Employee pursuant to Section 7.04.2.a7.05.3.a, Employer the Bank shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 7.05.3.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a7.05.3.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b7.05.3.b.
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Gross-Up Payment. Employee shall be entitled to a “Gross-Up Payment “ Payment” under the terms and conditions set forth herein, and such payment shall include the Excise Tax reimbursement due pursuant to section 7.04.2.a Section 8.01.3.a and any federal and state tax reimbursements due pursuant to section 7.04.2.bSection 8.01.3.b.
a. In the event that any payment or benefit (as those terms are defined within the meaning of Internal Revenue Code Section 280G(b)(2)) paid, payable, distributed or distributable to the Employee (hereinafter referred to as “Payments”) pursuant to the terms of this Agreement or otherwise in connection with or arising out of Employee’s employment with Employer or a change of control would be subject to the Excise Tax imposed by Section 4999 of the Internal Revenue code Code or any interest or penalties are incurred by Employee with respect to such Excise Tax, then Employee will be entitled to receive an additional payment (“Gross-Up Payment”) in an amount equal to the total Excise Tax, interest and penalties imposed on Employee as a result of the payment and the Excise Taxes on any federal and state tax reimbursements as set forth in Section 7.04.2.b8.01.3.b.
b. If Employer is obligated to pay Employee pursuant to Section 7.04.2.a8.01.3.a, Employer shall also shall pay Employee an amount equal to the “total presumed federal and state taxes” that could be imposed on Employee with respect to the Excise Tax reimbursements due to Employee pursuant to Section 7.04.2.a 8.01.3.a and the federal and state tax reimbursements due to Employee pursuant to this section. For purposes of the preceding sentence, the “total presumed federal and state taxes” that could be imposed on Employee shall be conclusively calculated using a combined tax rate equal to the sum of the (a) the highest individual income tax rate in effect under Federal tax law applicable to Employee and (ii) the tax laws of the state in which Employee resides will be subject to tax on the date that the payment is computed and (b) the hospital insurance portion of FICA.
c. No adjustments will be made in this combined rate for the deduction of state taxes on the federal return, the loss of itemized deductions or exemptions, or for any other purpose for paying the actual taxes. It is further intended that in the event that any payments would be subject to other “penalty” taxes (in addition to the Excise Tax in section 7.04.2.a8.01.3.a) imposed applicable federal tax law, that these taxes would also be included in the calculation of the Gross-Up Payment, including any federal and state tax reimbursements pursuant to section 7.04.2.b8.01.3.b.
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