Common use of Limitation of Benefits under Certain Circumstances Clause in Contracts

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 hereof, either alone or together with other payments and benefits that the Executive has the right to receive from the Companies, would constitute a “parachute payment” under Section 280G of the Code, such payments and benefits shall be reduced by the amount, if any, that is the minimum necessary to result in no portion of the payments or benefits constituting a parachute payment under Section 280G of the Code. The determination of any reduction in the payments and benefits made pursuant to this Section 6 shall be based upon the opinion of tax counsel selected by the Companies’ independent public accountants, paid by the Companies and reasonably acceptable to the Companies and the Executive. Such counsel shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, and may use such technical advisors as such counsel deems necessary or advisable for this purpose. In the event a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or benefits otherwise due or payable (on the basis of the relative present value of the parachute payments).

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 6 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesBank, would constitute a “parachute payment” under Section 280G of the Code, such the payments and benefits payable by the Bank pursuant to Section 6 hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment payable by the Bank under Section 6 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The parties hereto agree that the present value of the payments and benefits payable pursuant to this Agreement to the Executive upon termination shall be limited to three (3) times the Executive’s Average Annual Compensation. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 shall be based upon the opinion of tax independent counsel selected by the Companies’ Bank's independent public accountants, accountants and paid by the Companies and Bank. Such counsel shall be reasonably acceptable to the Companies Bank and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty sixty (3060) days from the Date of Termination or applicable severance from employment, following such counsel’s selection; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 7, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 6 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 7 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesBank, would constitute a “"parachute payment” " under Section 280G of the Code, such then the payments and benefits payable by the Bank pursuant to Section 7 hereof shall be reduced by the amount, if any, that is the minimum amount necessary to result in no portion of the payments or and benefits constituting a parachute payment under Section 7 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. If the payments and benefits under Section 7 are required to be reduced, the cash severance shall be reduced first, followed by a reduction in the fringe benefits. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 7 shall be based upon the opinion of independent tax counsel selected by the Companies’ independent public accountants, Bank and paid by the Companies and reasonably acceptable to the Companies and the ExecutiveBank. Such counsel shall promptly prepare the foregoing opinion, but in no event later than thirty ten (3010) days from the Date Event of Termination or applicable severance from employmentTermination, and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 8, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 7 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 2 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesEmployers, would constitute a “"parachute payment” " under Section 280G of the Code, such the payments and benefits payable by the Employers pursuant to Section 2 hereof shall be reduced by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment payable by the Employers under Section 2 being non-deductible to the Employers pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. If the payments and benefits are required to be reduced, the cash severance shall be reduced first, followed by a reduction in the fringe benefits to be provided in kind. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 2 shall be based upon the opinion of tax independent counsel selected by the Companies’ independent public accountants, Employers and paid by the Companies and reasonably acceptable to the Companies and the ExecutiveEmployers. Such counsel shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 3, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 2 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesBank, would constitute a “"parachute payment” " under Section 280G of the Code, such the payments and benefits payable by the Bank pursuant to Section 5 hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment payable by the Bank under Section 5 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The parties hereto agree that the payments and benefits payable pursuant to this Agreement to the Executive upon termination shall be limited to three times the Executive's Average Annual Compensation in accordance with OTS Regulatory Bulletin 27a. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 5 shall be based upon the opinion of independent tax counsel selected by the Companies’ Bank's independent public accountants, accountants and paid by the Companies and Bank. Such counsel shall be reasonably acceptable to the Companies Bank and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 6, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 5 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 4 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesEmployers, would constitute a “"parachute payment” " under Section 280G of the Code, such the payments and benefits payable by the Employers pursuant to Section 4(b) hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment under Section 4(b) being non-deductible HERITAGE BANCSHARES, INC. AND SUBSIDIARY to either of the Employers pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 4(b) shall be based upon the opinion of independent tax counsel selected by the Companies’ independent public accountants, Employers and paid by the Companies and Employers. Such counsel shall be reasonably acceptable to the Companies Employers and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 5, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 4 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesBank, would constitute a “"parachute payment” " under Section 280G of the Code, such the payments and benefits payable by the Bank pursuant to Section 5 hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment payable by the Bank under Section 5 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The parties hereto agree that the present value of the payments and benefits payable pursuant to this Agreement to the Executive upon termination shall be limited to three times the Executive's Average Annual Compensation. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 5 shall be based upon the opinion of tax independent counsel selected by the Companies’ Bank's independent public accountants, accountants and paid by the Companies and Bank. Such counsel shall be reasonably acceptable to the Companies Bank and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 6, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 5 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 4 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesEmployers, would constitute a “"parachute payment” " under Section 280G of the Code, such the payments and benefits payable by the Employers pursuant to Section 4(b) hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to HERITAGE BANCSHARES, INC. AND SUBSIDIARY result in no portion of the payments or and benefits constituting a parachute payment under Section 4(b) being non-deductible to either of the Employers pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 4(b) shall be based upon the opinion of independent tax counsel selected by the Companies’ independent public accountants, Employers and paid by the Companies and Employers. Such counsel shall be reasonably acceptable to the Companies Employers and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 5, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 4 below zero.

Limitation of Benefits under Certain Circumstances. If the payments and benefits pursuant to Section 5 hereof, either alone or together with other payments and benefits that which the Executive has the right to receive from the CompaniesBank, would constitute a “parachute payment” under Section 280G of the Code, such the payments and benefits payable by the Bank pursuant to Section 5 hereof shall be reduced reduced, in the manner determined by the Executive, by the amount, if any, that which is the minimum necessary to result in no portion of the payments or and benefits constituting a parachute payment payable by the Bank under Section 5 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The parties hereto agree that the present value of the payments and benefits payable pursuant to this Agreement to the Executive upon termination shall be limited to three times the Executive’s Average Annual Compensation. The determination of any reduction in the payments and benefits to be made pursuant to this Section 6 5 shall be based upon the opinion of tax independent counsel selected by the Companies’ Bank’s independent public accountants, accountants and paid by the Companies and Bank. Such counsel shall be reasonably acceptable to the Companies Bank and the Executive. Such counsel ; shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination or applicable severance from employment, Termination; and may use such technical advisors actuaries as such counsel deems necessary or advisable for this the purpose. In Nothing contained herein shall result in a reduction of any payments or benefits to which the event Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 6, or a reduction in payments is necessary in order to comply with the requirements of this Agreement relating to the limitations of Section 280G, then such reductions shall be applied based on the following principles, in order: (i) the payment or benefit with the higher ratio of the parachute payment value to present economic value (determined using reasonable actuarial assumptions) shall be reduced or eliminated before a payment or benefit with a lower ratio; (ii) the payment or benefit with the later possible payment date shall be reduced or eliminated before a payment or benefit with an earlier payment date; and (iii) cash payments shall be reduced prior to non-cash benefits; provided that if the foregoing order of reduction or elimination would violate Code Section 409A, then the reduction shall be made pro-rata among the payments or and benefits otherwise due or payable (on the basis of the relative present value of the parachute payments)specified in Section 5 below zero.