Common use of Section 280G Cutback Clause in Contracts

Section 280G Cutback. (a) If it is determined that the aggregate of all Payments (as defined below) that would be subject to the Excise Tax (as defined below), reduced by all federal, state and local taxes applicable thereto, including the Excise Tax, is less than the amount Executive would receive, after all such applicable taxes, if Executive received Payments equal to an amount which is $1.00 less than three times Executive’s “base amount”, as defined in and determined under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), then, in order to maximize Executive’s net after-tax return on the Payments, such Payments shall be automatically reduced or eliminated to the extent necessary so that the aggregate Payments received by Executive will not be subject to the Excise Tax. If a reduction in the Payments is necessary, reduction shall occur in the following order: (A) by first reducing or eliminating the portion of the Payments which are not payable in cash and are not attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof), (B) then by reducing or eliminating cash payments (other than that portion of the Payments subject to clause (D) hereof), (C) then by reducing or eliminating the portion of the Payments which are not payable in cash and are attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof) and (D) then by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.

Section 280G Cutback. (a) If it is determined that the aggregate of all Payments (as defined below) that would be subject to the Excise Tax (as defined below), reduced by all federalFederal, state and local taxes applicable thereto, including the Excise Tax, is less than the amount Executive would receive, after all such applicable taxes, if Executive received Payments equal to an amount which is $1.00 less than three times Executive’s “base amount”, as defined in and determined under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), then, in order to maximize Executive’s net after-tax return on the Payments, such Payments shall be automatically reduced or eliminated to the extent necessary so that the aggregate Payments received by Executive will not be subject to the Excise Tax. If a reduction in the Payments is necessary, reduction shall occur in the following order: (A) by first reducing or eliminating the portion of the Payments which are not payable in cash and are not attributable to equity awards (other than that portion of the Payments subject to clause (DC) hereof), (B) then by reducing or eliminating cash payments (other than that portion of the Payments subject to clause (DC) hereof), (C) then by reducing or eliminating the portion of the Payments which are not payable in cash and are attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof) awards, and (D) then by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time. For purposes of this Section 4.5, “Payment” shall mean any payment or distribution by the Company to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise pursuant to or by reason of any other agreement, policy, plan program or arrangement of the Company, including without limitation any restricted stock, stock option or similar right, or the lapse or termination of any restriction on or the vesting or exercisability of any of the foregoing. For purposes of this Section 4.5, the “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code (or any successor provision thereto), and any similar tax imposed by state or local law, and any interest or penalties with respect to such excise tax. The determination of whether the Payments shall be reduced as provided in this Section 4.5 hereof and the amount of such reduction shall be made at the Company’s expense by an accounting firm selected by the Company and such determination, absent manifest error, shall be binding, final and conclusive upon the Company and Executive.

Section 280G Cutback. (a) a. If it is determined that the aggregate of all Payments (as defined below) that would be subject to the Excise Tax (as defined below), reduced by all federal, state and local taxes applicable thereto, including the Excise Tax, is less than the amount Executive would receive, after all such applicable taxes, if Executive received Payments equal to an amount which is $1.00 less than three times Executive’s 's “base amount”, as defined in and determined under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), then, in order to maximize Executive’s 's net after-tax return on the Payments, such Payments shall be automatically reduced or eliminated to the extent necessary so that the aggregate Payments received by Executive will not be subject to the Excise Tax. If a reduction in the Payments is necessary, reduction shall occur in the following order: (A) by first reducing or eliminating the portion of the Payments which are not payable in cash and are not attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof), (B) then by reducing or eliminating cash payments (other than that portion of the Payments subject to clause (D) hereof), (C) then by reducing or eliminating the portion of the Payments which are not payable in cash and are attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof) and (D) then by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.

Section 280G Cutback. (a) If it is determined that the aggregate of all Payments (as defined below) that would be subject to the Excise Tax (as defined below), reduced by all federalFederal, state and local taxes applicable thereto, including the Excise Tax, is less than the amount Executive would receive, after all such applicable taxes, if Executive received Payments equal to an amount which is $1.00 less than three times Executive’s “base amount”, as defined in and determined under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), then, in order to maximize Executive’s net after-tax return on the Payments, such Payments shall be automatically reduced or eliminated to the extent necessary so that the aggregate Payments received by Executive will not be subject to the Excise Tax. If a reduction in the Payments is necessary, reduction shall occur in the following order: (A) first by first reducing or eliminating the portion of the Payments which are not payable in cash and are not attributable to equity awards (other than that portion of the Payments subject to clause (D) hereof)awards, (B) then second by reducing or eliminating cash payments (other than that portion of the Payments subject to clause (D) hereof)payments, (C) then third by reducing or eliminating the portion of the Payments which are not payable in cash and are attributable to equity awards (other than that portion of awards described in the Payments subject to clause (D) hereoffollowing clause) and (D) then finally by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.