Parachute Payment Limitation Clause Samples

Parachute Payment Limitation. Notwithstanding anything in this Agreement to the contrary, if the total of the Change in Control Payment and the Salary Continuation Payment, together with any other payments or benefits received from the Company or the Bank, will be an amount that would cause them to be a "parachute payment" within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code of 1986, as amended (the “Parachute Payment Amount”), then the sum of the Change in Control Payment and the Salary Continuation Payment shall be reduced so that the total amount thereof is $1 less than the Parachute Payment Amount.

Parachute Payment Limitation. If any payment or benefit (including payments and benefits pursuant to this Agreement) Executive would receive in connection with a Change in Control from the Company or otherwise (“Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this paragraph, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company shall cause to be determined, before any amounts of the Payment are paid to Executive, which of the following two alternative forms of payment shall be paid to Executive: (A) payment in full of the entire amount of the Payment (a “Full Payment”), or (B) payment of only a part of the Payment so that Executive receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”). A Full Payment shall be made in the event that the amount received by the Executive on a net after-tax basis is greater than what would be received by the Executive on a net after-tax basis if the Reduced Payment were made, otherwise a Reduced Payment shall be made. If a Reduced Payment is made, (i) the Payment shall be paid only to the extent permitted under the Reduced Payment alternative, and Executive shall have no rights to any additional payments and/or benefits constituting the Payment, and (ii) reduction in payments and/or benefits shall occur in the following order: (A) reduction of cash payments; (B) cancellation of accelerated vesting of equity awards other than stock options; (C) cancellation of accelerated vesting of stock options; and (D) reduction of other benefits paid to Executive. In the event that acceleration of compensation from Executive’s equity awards is to be reduced, such acceleration of vesting shall be canceled in the reverse order of the date of grant.

Parachute Payment Limitation. Notwithstanding any contrary provision in this Agreement, if the Executive is a “disqualified individual” (as defined in Section 280G of the Code), and the severance or change of control payments and benefits described in Paragraph 9, together with any other payments which the Executive has the right to receive from the Company, would constitute a “parachute payment” (as defined in Section 280G of the Code), the payments and benefits provided hereunder shall be reduced (but not below zero) so that the aggregate present value of such payments and benefits received by the Executive from the Company shall be $1.00 less than three times the Executive’s “base amount” (as defined in Section 280G of the Code) and so that no portion of such payments received by the Executive shall be subject to the excise tax imposed by Section 4999 of the Code. The determination as to whether any such reduction in the amount of the payments and benefits is necessary shall be made by the Company in good faith and such determination shall be conclusive and binding on the Executive. If a reduced payment is made to the Executive and through error or otherwise that payment, when aggregated with other payments from the Company (or its affiliates) used in determining if a parachute payment exists, exceeds $1.00 less than three times the Executive’s base amount, the Executive shall immediately repay such excess to the Company upon notification that an overpayment has been made.

Parachute Payment Limitation. Notwithstanding anything in this agreement to the contrary, if any severance pay or benefits payable under this agreement (without the application of this Section 7), either alone or together with other payments, awards, benefits or distributions (or any acceleration of any payment, award, benefit or distribution) pursuant to any agreement, plan or arrangement with ▇▇▇▇▇▇ or any of its affiliates (the "Total Payments"), would constitute a "parachute payment" (as defined in Section 280G of the U.S. Internal Revenue Code of 1986, as amended, and regulations thereunder (the "Code")), then [the following shall occur: (a) tax counsel selected by ▇▇▇▇▇▇'▇ independent auditors and acceptable to Executive shall compute the net present value to Executive of all the Total Payments after reduction for the excise taxes imposed by Code Section 4999 and for any normal income taxes that would be imposed on Executive if such Total Payments constituted Executive's sole taxable income; and (b) said tax counsel shall next compute the maximum Total Payments that can be provided without any such Total Payments being characterized as "Excess Parachute Payments" (as defined in Code Section 280G) and reduce the result by the amount of any normal income taxes that would be imposed on Executive if such reduced Total Payments constituted Executive's sole taxable income. If the result derived in clause (a) above is greater than the result derived in clause (b) above by more than 10% of the result derived in clause (b) above, then ▇▇▇▇▇▇ shall pay Executive the full amount of the Total Payments without reduction. If the result derived from clause (a) above is not greater than the result derived in clause (b) above by more than 10% of the result derived in clause (b) above, then ▇▇▇▇▇▇ shall pay Executive the maximum Total Payments possible without any such Total Payments being characterized as Excess Parachute Payments. The determination of how such Total Payments will be reduced shall be made by Executive in good faith after consultation with ▇▇▇▇▇▇.

Parachute Payment Limitation. If any payment or benefit (including payments and benefits pursuant to this Agreement) Executive would receive in connection with a Change in Control from the Company or otherwise (“Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company shall cause to be determined, before any amounts of the Payment are paid to Executive, which of the following two alternative forms of payment shall be paid to Executive: (i) payment in full of the entire amount of the Payment (a “Full Payment”), or (ii) payment of only a part of the Payment so that Executive receives the largest payment possible without the imposition of the Excise Tax (a “Reduced Payment”). A Full Payment shall be made in the event that the quotient obtained by dividing (i) the excess of (a) the Full Payment, over (b) the Reduced Payment, by (ii) the Reduced Payment, is greater than ten percent (10%). A Reduced Payment shall be made in the event that the quotient obtained by dividing (i) the excess of (a) the Full Payment, over (b) the Reduced Payment, by (ii) the Reduced Payment, is less than or equal to ten percent (10%). If a Reduced Payment is made, (i) the Payment shall be paid only to the extent permitted under the Reduced Payment alternative, and Executive shall have no rights to any additional payments and/or benefits constituting the Payment, and (ii) reduction in payments and/or benefits shall occur in the following order: (1) reduction of cash payments; (2) cancellation of accelerated vesting of equity awards other than stock options; (3) cancellation of accelerated vesting of stock options; and (4) reduction of other benefits paid to Executive. In the event that acceleration of compensation from Executive’s equity awards is to be reduced, such acceleration of vesting shall be canceled in the reverse order of the date of grant.

Parachute Payment Limitation. Notwithstanding anything in this Agreement to the contrary, if it shall be determined that any amount, right or benefit payable by the Company or any other person or entity to or for the Executive’s benefit in connection with the Change in Control, whether pursuant to the terms of this Agreement or otherwise (a “Payment”), would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended, and if it shall be determined that a reduction of the Payments to a present value that is one dollar less than the minimum present value that would result in the imposition of such excise tax would result in a larger after-tax benefit to Executive than if such reduction had not occurred, then the Payments shall be reduced so as to have a present value that is one dollar less than the minimum present value that would result in the imposition of such excise tax. If the foregoing should result in a reduction in the Payments, the reduction shall be applied first against all cash Payments and then, if necessary, against non-cash Payments in order to satisfy the requirements of this Section 5. All determinations concerning the application of this Section 5 shall be made by a nationally recognized accounting firm to be appointed by the Company. The determinations of the accounting firm shall be conclusive and binding on the parties hereto for all purposes. All fees and expenses of the accounting firm shall be paid by Company.

Parachute Payment Limitation. Notwithstanding any other provision of this Agreement, if any Parachute Payment or Payments are characterized as Excess Parachute Payments, then the following rules shall apply: 5.4.1 The Company shall compute the net value to the Executive of all such severance payments after reduction for the excise taxes imposed by Section 4999 of the Code and for any normal income taxes that would be imposed on the Executive if such severance payments constituted the Executive's sole taxable income; 5.4.2 The Company shall next compute the maximum amount of severance payments that can be provided without any such payments being characterized as Excess Parachute Payments, and reduce the result by the amount of any normal income taxes that would be imposed on the Executive if such reduced severance benefits constituted the Executive's sole taxable income; 5.4.3 If the amount derived in Section 5.4.1 is greater than the amount derived in Section 5.4.2, then the Company shall pay the Executive the full the amount of severance payments without reduction. If the amount derived in Section 5.4.1 is not greater than the amount derived in Section 5.4.2, then the Company shall pay the Executive the maximum amount of severance payments that can be provided without any such payments being characterized as Excess Parachute Payments.

Parachute Payment Limitation. In the event that it is determined that any payment or distribution of any type to or for your benefit is made by the Company, by any of its affiliates, by any person who acquires ownership or effective control or ownership of a substantial portion of the Company’s assets (within the meaning of Section 280G of the Code) or by any affiliate of such person, whether paid or payable or distributed or distributable pursuant to the terms of an employment agreement or otherwise, would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest or penalties, are collectively referred to as the “Excise Tax”), and (ii) if, as a result of being subject to the Excise Tax, the aggregate after-tax amounts received by you from the Company, any of its affiliates, or any person who acquires ownership or effective control or ownership of a substantial portion of the Company’s assets or by any affiliate of such person would be less than the maximum after-tax amount that could be received by you without causing any such payment or benefit to be subject to an Excise Tax, then you shall have the right, in your sole discretion, to designate those rights, payments, or benefits under this letter agreement and Offer Letter, any other agreements, and any benefit arrangements that should be reduced or eliminated so as to avoid having the payment or benefit to you under this letter agreement or the Offer Letter be deemed to be a parachute payment under Section 280G of the Code.

Parachute Payment Limitation. Notwithstanding any other provision of this Agreement, if the severance payments under Section 5.03 of this Agreement, together with any other Parachute Payments made by the Company to the Executive, if any, are characterized as Excess Parachute Payments, then the following rules shall apply: (a) The Company shall compute the net value to the Executive of all such severance payments after reduction for the excise taxes imposed by Section 4999, of the Code and for any normal income taxes that would be imposed on the Executive if such severance payments constituted the Executive's sole taxable income; (b) The Company shall next compute the maximum amount of severance payments that can be provided without any such payments being characterized as Excess Parachute Payments, and reduce the result by the amount of any normal income taxes that would be imposed on the Executive if such reduced severance benefits constituted the Executive's sole taxable income; (c) If the amount derived in Section 5.04(a) is greater than the amount derived in Section 5.04(b), then the Company shall pay the Executive the full amount of severance payments without reduction. If the amount derived in Section 5.04(a) is not greater than the amount derived in Section 5.04(b), then the Company shall pay the Executive the maximum amount of severance payments that can be provided without any such payments being characterized as Excess Parachute Payments.