Common use of Section 280G Matters Clause in Contracts

Section 280G Matters. At least fourteen (14) days prior to the Closing Date, the Company shall use its reasonable best efforts to (i) obtain an executed written agreement (a “Section 280G Waiver”) from each “disqualified individual,” within the meaning of Section 280G of the Code and the applicable rulings and final regulations promulgated thereunder (“Section 280G of the Code”), waiving the right to receive any payments and/or benefits that may separately or in the aggregate constitute “parachute payments” within the meaning of Section 280G (“Section 280G Payment”) and to accept in substitution therefor the right to receive such payments only if approved by the Company Stockholders in a manner that complies with Section 280G(b)(5)(B) of the Code, (ii) provide the Company Stockholders with adequate disclosure, within the meaning of Section 280G(b)(5)(B)(ii) of the Code, of all material facts concerning the Section 280G Payments, and (iii) obtain approval of such Section 280G Payments, in a manner which satisfies the requirements of Section 280G of the Code. Prior to soliciting executed Section 280G Waivers and Company Stockholder approval as provided in this Section, the Company shall provide drafts of the Company Stockholder approval materials and Section 280G Waivers to Purchaser and Purchaser’s advisors for their review and approval, which approval shall not be unreasonably withheld. Prior to the Closing Date, the Company shall deliver to Purchaser evidence that a vote of the Company Stockholders was solicited in accordance with this Section with respect to each Person who executes a Section 280G Waiver and that either (i) the requisite Company Stockholder approval was obtained with respect to each Person who executes a Section 280G Waiver, or (ii) the requisite Company Stockholder approval was not obtained and, as a consequence, the Section 280G Payments shall not be made to any Person who executes a Section 280G Waiver.

Section 280G Matters. At least fourteen (14a) days The Company shall obtain and deliver to Parent, prior to the Closing Dateinitiation of the procedure described in Section 4.17(b), an excess parachute payment waiver, in substantially the form attached hereto as Exhibit H, from each Person whom the Company shall use its reasonable best efforts reasonably believes is, with respect to (i) obtain an executed written agreement (the Company, any Subsidiary of the Company and/or any ERISA Affiliate of the Company, a “Section 280G Waiver”) from each “disqualified individual,” (within the meaning of Section 280G of the Code and the applicable rulings and final regulations promulgated thereunder (“thereunder), as determined immediately prior to the initiation of the procedure described in Section 4.17(b), and who might otherwise have, receive or have the right or entitlement to receive an excess parachute payment under Section 280G of the Code”Code as a result of (i) the accelerated vesting of such Person’s Company Options or unvested Company Capital Stock in connection with the Merger and/or the termination of employment or service with the Company, Parent or any of their Subsidiaries following the Merger, (ii) any severance payments or other benefits or payments in connection with the Merger and/or the termination of employment or service with the Company, Parent or any of their Subsidiaries following the Merger, and/or (iii) the receipt of any Company Options or Company Capital Stock within the 12-month period ending on the date on which the Effective Time occurs, in accordance with which each such Person shall agree to waive any and all right or entitlement to the accelerated vesting, payments, benefits, options and stock referred to in clauses (i), waiving the right to receive any payments and/or benefits that may separately or in the aggregate constitute “parachute payments” within the meaning of Section 280G (“Section 280G Payment”ii) and (iii) unless the requisite shareholder approval of such accelerated vesting, payments, benefits, options and stock is obtained in accordance with Section 4.17(b). (b) The Company shall use its reasonable best efforts to accept in substitution therefor obtain the right to receive approval by such payments only if approved number of Company Shareholders as is required by the Company Stockholders in a manner that complies with terms of Section 280G(b)(5)(B) of the Code, (ii) provide Code so as to render the Company Stockholders with adequate disclosure, within the meaning of Section 280G(b)(5)(B)(ii) of the Code, of all material facts concerning the Section 280G Payments, and (iii) obtain approval of such Section 280G Payments, in a manner which satisfies the requirements parachute payment provisions of Section 280G of the Code. Prior Code inapplicable to soliciting executed Section 280G Waivers any and Company Stockholder approval as all payments and/or benefits provided in this Section, the Company shall provide drafts of the Company Stockholder approval materials and Section 280G Waivers to Purchaser and Purchaser’s advisors for their review and approval, which approval shall not be unreasonably withheld. Prior to the Closing Date, the Company shall deliver to Purchaser evidence that a vote of the Company Stockholders was solicited in accordance with this agreements, contracts or arrangements that, in the absence of the executed Excess Parachute Payment Waivers by the Persons described in Section with respect to each Person who executes 4.17(a), might otherwise result, separately or in the aggregate, in such payment being considered a “parachute payment,” in a manner which satisfies all applicable requirements of such Section 280G Waiver 280G(b)(5)(B) of the Code and that either (i) the requisite Company Stockholder approval was obtained with respect to each Person who executes a Treasury Regulations thereunder, including Q-7 of Section 280G Waiver, or (ii) the requisite Company Stockholder approval was not obtained and, as a consequence, the Section 280G Payments shall not be made to any Person who executes a Section 280G Waiver1.280G-1 of such Treasury Regulations.

Section 280G Matters. At least fourteen (14a) days Target shall use commercially reasonable efforts to obtain and deliver to Acquiror, prior to the Closing Dateinitiation of the requisite stockholder approval procedure under Section 5.22(b), the Company shall use its reasonable best efforts to (i) obtain an executed written agreement (a “Section 280G Excess Parachute Payment Waiver”) , in substantially the form attached hereto as Exhibit G from each person who Target reasonably believes is, with respect to Target and/or any ERISA Affiliate, a “disqualified individual,” (within the meaning of Section 280G of the Code and the applicable rulings and final regulations promulgated thereunder (“thereunder), as determined immediately prior to the initiation of the requisite stockholder approval procedure under Section 5.22(b), and who might otherwise have, receive or have the right or entitlement to receive an excess parachute payment under Section 280G of the Code”, including any that will or may result from (i) the accelerated vesting of such person’s Target Options or unvested Target Capital Stock in connection with the Merger and/or the termination of employment or service with Target or with Acquiror following the Merger, (ii) any severance payments or other benefits or payments in connection with the Merger and/or the termination of employment or service with Target or with Acquiror following the Merger, and/or (iii) the receipt of any Target Options or Target Capital Stock within the 12-month period ending on the date on which the Effective Time occurs, pursuant to which each such person shall agree to waive, to the extent necessary to avoid an excess parachute payment under Section 280G of the Code, any and all right or entitlement to the accelerated vesting, payments, benefits, options and stock referred to in clauses (i), waiving (ii) and (iii) unless the right requisite stockholder approval of such accelerated vesting, payments, benefits, options and stock is obtained pursuant to receive Section 5.22(b). (b) Target shall use commercially reasonable efforts to obtain, prior to the Closing, the approval by such number of stockholders of Target as is required by the terms of Section 280G(b)(5)(B) so as to render the parachute payment provisions of Sections 280G and 4999 of the Code inapplicable to any and all payments and/or benefits that may provided pursuant to agreements, contracts or arrangements related to the persons identified in Section 5.22(a) that, in the absence of such stockholder approval, might otherwise constitute, separately or in the aggregate constitute “aggregate, parachute payments” within the meaning of Section 280G (“Section 280G Payment”) and to accept in substitution therefor the right to receive such payments only if approved by the Company Stockholders in a manner that complies with Section 280G(b)(5)(B) of the Code, (ii) provide the Company Stockholders with adequate disclosure, within the meaning of Section 280G(b)(5)(B)(ii) of the Code, of all material facts concerning the Section 280G Payments, and (iii) obtain approval of such Section 280G Payments, in a manner which satisfies the requirements of under Section 280G of the Code. Prior to soliciting executed Such stockholder approval shall be obtained in a manner which satisfies all applicable requirements of such Section 280G Waivers and Company Stockholder approval as provided in this Section, the Company shall provide drafts 280G(b)(5)(B) of the Company Stockholder approval materials Code and Section 280G Waivers the applicable Treasury Regulations thereunder. (c) Target shall use its commercially reasonable efforts to Purchaser obtain and Purchaser’s advisors for their review and approvaldeliver to Acquiror, which approval shall not be unreasonably withheld. Prior at or prior to the Closing DateClosing, written acknowledgement, in form and substance reasonably satisfactory to Acquiror, from each person to whom shares of Target Capital Stock have been transferred by a disqualified individual described in Section 5.22(a), that such person’s right to retain the Company such Target Capital Stock or receive any accelerated vesting or other benefits with respect to such stock shall deliver be subject to Purchaser evidence that a vote of the Company Stockholders was solicited stockholder approval (in accordance with this Section with respect 5.22(b)) pursuant to each Person who executes a the waiver executed by the disqualified individual as required under Section 280G Waiver and that either (i) the requisite Company Stockholder approval was obtained with respect to each Person who executes a Section 280G Waiver, or (ii) the requisite Company Stockholder approval was not obtained and, as a consequence, the Section 280G Payments shall not be made to any Person who executes a Section 280G Waiver5.22(a).

Section 280G Matters. At least fourteen (14) days prior Prior to the Closing Date, the Company shall (a) use its reasonable best efforts Reasonable Efforts to (i) obtain an executed written agreement (a “Section 280G Waiver”) from each Person who is, with respect to the Company, a “disqualified individual,” (within the meaning of Section 280G of the Code and the applicable rulings and final regulations promulgated thereunder (“Code) as determined under Section 280G of the CodeCode (each, a “Disqualified Individual”), waiving the right to and who otherwise would receive any payments and/or benefits that may separately or in the aggregate constitute “parachute paymentspayment” (within the meaning of Section 280G of the Code), a waiver of such Disqualified Individual’s rights to all such payments and/or benefits applicable to such Disqualified Individuals (such waived payments, the “Waived Parachute Payments”) solely to the extent required to avoid imposition of any excise Taxes by operation of Section 280G Payment”) and to accept Section 4999 of the Code and, in substitution therefor therefor, the right to receive such payments only if approved by equityholders of the Company Stockholders in a manner that complies with Section 280G(b)(5)(B) of the Code, (iib) provide the Company Stockholders with adequate disclosure, within the meaning of Section 280G(b)(5)(B)(ii) of the Code, promptly deliver to Parent copies of all material facts concerning the Section 280G Paymentsexecuted waivers so obtained, and (iiic) obtain submit to the Company’s equityholders for approval by such number of such Section 280G Paymentsequityholders, in a manner which satisfies that meets the requirements of Section 280G(b)(5)(B) of the Code (the “280G Approval”), the Waived Parachute Payments such that, following the 280G Approval, such payments and benefits shall not be deemed to be “parachute payments” under Section 280G of the Code. The Company shall provide Parent with (i) copies of all documents prepared pursuant to this Section 4.14, (ii) a reasonable opportunity to review and comment on such documents before such documents are finalized, which comments the Company shall consider in good faith incorporating into such documents, and (iii) the results of the vote of equityholders described in this Section 4.14. All costs and expenses of obtaining the waivers and soliciting the vote under this Section 4.14 shall be paid by the Company prior to the Closing Date or included as a Transaction Expense. Prior to soliciting executed the 280G Approval, Parent shall provide in writing to the Company the relevant details of all payments, benefits and arrangements, if any, to be entered into with or otherwise provided to any Disqualified Individual by Parent or any affiliate or subsidiary of Parent, in each case, that could reasonably be expected to be taken into account in determining whether any payments and benefits constitute “parachute payment” pursuant to Section 280G Waivers and Company Stockholder approval as provided in this Section, the Company shall provide drafts of the Company Stockholder approval materials and Section 280G Waivers to Purchaser and Purchaser’s advisors for their review and approval, which approval shall not be unreasonably withheld. Prior to the Closing Date, the Company shall deliver to Purchaser evidence that a vote of the Company Stockholders was solicited in accordance with this Section Code with respect to each any such Person who executes a Section 280G Waiver and that either (i) in connection with the requisite Company Stockholder approval was obtained with respect to each Person who executes a Section 280G Waiver, or (ii) the requisite Company Stockholder approval was not obtained and, as a consequence, the Section 280G Payments shall not be made to any Person who executes a Section 280G Waivertransactions contemplated by this Agreement.

Section 280G Matters. At least fourteen With respect to each service provider of the Company Group and its Affiliates who is a “disqualified individual” (14as defined in Section 280G(c) days of the Code), no later than five (5) Business Days prior to the Closing DateClosing, the Company shall use its commercially reasonable best efforts to (i) obtain an executed written agreement (a “Section 280G Waiver”) secure from each such individual who has a right to any payments or economic benefits pursuant to any Company Benefit Program and any agreement to which such individual is entitled in connection with the Transactions or otherwise that could reasonably be deemed to constitute “disqualified individual,parachute payments” within the meaning of Section 280G of the Code and the applicable rulings and final regulations promulgated thereunder (“as defined in Section 280G of the Code”)) a waiver, waiving subject to the right approval described below in this Section 5.25, of such individual’s rights to receive any payments and/or benefits that may separately or in the aggregate constitute all of such “parachute payments” that are equal to or in excess of three times such individual’s “base amount” (within the meaning of Code Section 280G G) less one dollar (the “Section Waived 280G PaymentBenefits”) and ). If any individual waives his or her rights to accept the Waived 280G Benefits as described in substitution therefor the right to receive such payments only if approved by immediately preceding sentence, the Company Stockholders shall use commercially reasonable efforts to submit such individual’s rights to such Waived 280G Benefits to its stockholders for their approval in a manner that complies accordance with the requirements of Section 280G(b)(5)(B) of the Code, (ii) provide Code and in a manner that satisfies the Company Stockholders with adequate disclosure, within the meaning applicable requirements of Section 280G(b)(5)(B)(ii280G(b)(5)(B) of the CodeCode and any regulations promulgated thereunder; provided, of all material facts concerning that in no event shall this Section 5.25 be construed to require the Section 280G PaymentsCompany to compel any Person to waive any existing rights under any contract or agreement that such Person has with the Company Group, and (iii) obtain in no event shall the Company be deemed in breach of this Section 5.25 if any such Person refuses to waive any such rights or such member approval is not obtained. Within a reasonable period of time before taking such Section 280G Paymentsactions and, in a manner which satisfies no event, less than three (3) Business Days prior to taking such actions, the requirements Company shall deliver to the Parent for review copies of any documents, agreements, or other materials as necessary to effect this Section 5.25 (including any stockholder consent form, disclosure statement or waiver, and calculations related to any potential parachute payments under Section 280G of the Code) for the Parent’s review and comment (which comments shall be considered by the Company in good faith) and, where reasonable (as determined by the Company in good faith), incorporated into the applicable documents or calculations. Prior to soliciting executed Section To the extent that any such Waived 280G Waivers and Company Stockholder approval as provided in this SectionBenefits do not obtain such approval, the Company shall provide drafts of the Company Stockholder approval materials and Section such Waived 280G Waivers to Purchaser and Purchaser’s advisors for their review and approval, which approval Benefits shall not be unreasonably withheld. Prior retained, made or provided to the Closing Dateapplicable individual, whether by the Company Group or the Parent, or any of their respective Affiliates. No later than three (3) Business Days prior to the Closing, the Company shall deliver to Purchaser the Parent evidence that a vote of the Company Stockholders such approval was solicited in accordance with the foregoing provisions of this Section with respect to each Person who executes a Section 280G Waiver 5.25 and that either (ia) the requisite Company Stockholder approval was number of votes were obtained with respect to each Person who executes a Section such Waived 280G WaiverBenefits, or (iib) the requisite Company Stockholder such approval was not obtained and, as a consequence, the Section such Waived 280G Payments Benefits shall not be retained, made or provided to the applicable individual, whether by any Person who executes a Section 280G Waiverof the Company Group, Parent or any of their respective Affiliates.