Six-Month Delay Rule Clause Samples

The Six-Month Delay Rule establishes a specific period—typically six months—during which certain obligations or actions under a contract may be postponed without penalty. In practice, this clause might apply to the commencement of services, delivery of goods, or the fulfillment of payment terms, allowing either party to delay performance if specific conditions, such as regulatory approvals or unforeseen events, occur. Its core function is to provide flexibility and certainty by setting a clear timeframe for permissible delays, thereby reducing disputes and managing expectations between the parties.
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Six-Month Delay Rule. Notwithstanding anything to the contrary contained in this Agreement, for each payment under this Agreement (a) if the Associate is a specified employee at the time of the Associate’s Termination, then, in accordance with the six-month delay rule, the payment date of such payment shall be delayed (if there would be a delay) to the date that is six months after the date of Termination or, if earlier, the date that is the seventh (7th) day following the Associate’s date of death, but (b) the foregoing delay shall be inapplicable to such payment to the extent such payment is excluded from the six-month delay rule by virtue any of the exceptions described under Treas. Reg. § 1.409A-1(b) (including without limitation any of the separation pay plan exceptions set forth in Treas. Reg. § 1.409A-1(b)(9)), or is otherwise excluded under Code section 409A from the application of the six-month delay rule requirements.
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Six-Month Delay Rule. The “six-month delay rule” will apply to 409A Restricted Stock Units if the following four conditions exist: 1. The Participant has a separation from service (within the meaning of Treasury Regulation Section 1.409A-1(h)); 2. A payment is triggered by the separation from service (but not due to death); 3. The Participant is a “specified employee” under Code Section 409A; and 4. The payment in settlement of the Restricted Stock Units would otherwise occur within six months after the separation from service. If the six-month delay rule applies, payment in settlement of the Restricted Stock Units shall instead be made on the first business day after the date that is six months following the Participant's separation from service (or death, if earlier), with interest from the date such payment would otherwise have been made at the short-term applicable federal rate, compounded semi-annually, as determined under Section 1274 of the Code, for the month in which payment would have been made but for the delay in payment. During the six-month delay period, accelerated payment will be permitted in the event of the Participant’s death and for no other reason (including no acceleration upon a Change of Control) except to the extent permitted under Code Section 409A.
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Six-Month Delay Rule. The “six-month delay rule” will apply to ▇▇▇▇ ▇▇▇▇ if these four conditions are met: (A) the Grantee has a separation from service (within the meaning of Treasury Regulation § 1.409A-1(h)) for a reason other than death; (B) a payment in settlement is triggered by such separation from service; and (C) the Grantee is a “specified employee” under Code Section 409A. If it applies, the six-month delay rule will delay a settlement of ▇▇▇▇ ▇▇▇▇ triggered by separation from service where the settlement otherwise would occur within six months after the separation from service, subject to the following: (D) any delayed payment shall be made on the date six months and one day after separation from service; (E) during the six-month delay period, accelerated settlement will be permitted in the event of the Grantee’s death and for no other reason (including no acceleration upon a Change in Control) except to the extent permitted under Code Section 409A; and (F) any settlement that is not triggered by a separation from service, or is triggered by a separation from service but would be made more than six months after separation (without applying this six-month delay rule), shall be unaffected by the six-month delay rule.
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Six-Month Delay Rule. If, as of his termination date, Executive is a “specified employee” (as determined by the Company in accordance with its guidelines established pursuant to Treas. Reg. § 1.409A-1(i)), any amount payable to Executive upon or by reason of his termination of employment (including expense reimbursements and in-kind benefits that are includible in income) shall be subject to the six (6) month delay required by Section 409A(a)(2)(B)(i) of the Code; provided, however, that such six (6) month delay shall not be required with respect to any payment that the Company determines is not subject to Section 409A by reason of the “short-term deferral” rule described in Treas. Reg. § 1.409A-1(b)(4), the “two-year, two-time” rule described in Treas. Reg. § 1.409A-1(b)(9)(iii), or any other exemption. If payment of any amount is delayed by reason of this six (6) month delay, such amount shall be paid with interest on the Company’s first pay date for the seventh (7th) month that starts after Executive’s termination date (or, if earlier, within 90 days after Executive’s death). Except as otherwise provided in a governing document for an applicable benefit plan, program, or other arrangement, interest shall be calculated using the prime rate of interest in effect at Bank of America, N.A. (or another bank designated by the Company that is one of its principal banks) on Executive’s termination date.
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Six-Month Delay Rule. Notwithstanding anything to the contrary contained in this Agreement, if at the time of the Executive’s separation from service within the meaning of Section 409A of the Code, the Company determines that the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Executive becomes entitled to under this Agreement on account of the Executive’s separation from service would be considered deferred compensation subject to the 20% additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (i) six (6) months and one (1) day after the Executive’s separation from service, or (ii) the Executive’s death (the “Six Month Delay Rule”). For purposes of this Section, amounts payable under the Agreement should not be considered a deferral of compensation subject to Section 409A to the extent provided in Treasury Regulation Section 1.409A-1(b)(4) (i.e., short-term deferrals), Treasury Regulation Section 1.409A-1(b)(9) (i.e., separation pay plans, including the exception under subparagraph (iii)), and other applicable provisions of Treasury Regulations Sections 1.409A-1 through A-6. To the extent that the Six Month Delay Rule applies to payments otherwise payable on an installment basis, the first payment shall include a catch-up payment covering amounts that would otherwise have been paid during the six (6) month period but for the application of the Six Month Delay Rule, and the balance of the installments shall be payable in accordance with their original schedule. To the extent that the Six Month Delay Rule applies to the provision of benefits (including life and medical insurance), such benefits coverage shall nonetheless be provided to the Executive during the first six (6) months following his separation from service (the “Six Month Period”), provided that, during such Six-Month Period, the Executive pays to the Company, on a monthly basis in advance, an amount equal to the Monthly Cost (as defined below) of such benefit coverage. The Company shall reimburse the Executive for any such payments made by the Executive in a lump sum not later than thirty (30) days following the sixth (6th) month anniversary of the Executive’s separation from service. For purposes of this subparagraph, “Monthly Cost...
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Six-Month Delay Rule. If, as of the effective date of Executive’s termination of employment, Executive is a “specified employee,” as determined by the Company in accordance with Code Section 409A(a)(2)(B)(i) and the guidelines established pursuant to Treasury regulation §1.409A-1(i), any amount payable to Executive upon or by reason of a termination of employment that constitutes a “deferral of compensation” within the meaning of Code Section 409A shall be subject to a six (6) month delay as required by Code Section 409A(a)(2)(B)(i); provided, however, that such six (6) month delay shall not be required with respect to any payment (or portion thereof) that the Company determines is not governed by Code Section 409A by reason of Section 25(a), Section 25(b) or any other exemption. If a payment of any amount is delayed by reason of this six (6) month delay, such amount or amounts shall be paid, without interest, on the Company’s first payroll date in the seventh (7th) month that starts after the effective date of Executive’s termination of employment (or, if earlier, within ninety (90) days after Executive’s death on a date determined by the Company in its sole discretion).
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Six-Month Delay Rule 
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Related to Six-Month Delay Rule

  • Compliance with Internal Revenue Code Section 409A The Employer and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with section 409A of the Internal Revenue Code of 1986. If when the Executive’s employment terminates the Executive is a specified employee, as defined in section 409A of the Internal Revenue Code of 1986, and if any payments under this Agreement, including Articles 4 or 5, will result in additional tax or interest to the Executive because of section 409A, then despite any provision of this Agreement to the contrary the Executive shall not be entitled to the payments until the earliest of (x) the date that is at least six months after termination of the Executive’s employment for reasons other than the Executive’s death, (y) the date of the Executive’s death, or (z) any earlier date that does not result in additional tax or interest to the Executive under section 409A. As promptly as possible after the end of the period during which payments are delayed under this provision, the entire amount of the delayed payments shall be paid to the Executive in a single lump sum. If any provision of this Agreement does not satisfy the requirements of section 409A, the provision shall be applied in a manner consistent with those requirements despite any contrary provision of this Agreement. If any provision of this Agreement would subject the Executive to additional tax or interest under section 409A, the Employer shall reform the provision. However, the Employer shall maintain to the maximum extent practicable the original intent of the applicable provision without subjecting the Executive to additional tax or interest, and the Employer shall not be required to incur any additional compensation expense as a result of the reformed provision. References in this Agreement to section 409A of the Internal Revenue Code of 1986 include rules, regulations, and guidance of general application issued by the Department of the Treasury under Internal Revenue Code section 409A.