Special Rule for Specified Employees Sample Clauses
The Special Rule for Specified Employees clause establishes unique requirements or restrictions that apply to a particular group of employees, often those classified as 'specified employees' under tax or regulatory definitions. Typically, this clause outlines how certain benefits, such as deferred compensation, are handled differently for these employees, for example by imposing a mandatory waiting period before distributions can be made following separation from service. Its core function is to ensure compliance with legal or tax regulations, such as Section 409A of the Internal Revenue Code, and to prevent preferential treatment or unintended tax consequences for highly compensated or key employees.
Special Rule for Specified Employees. Notwithstanding anything in this Agreement to the contrary, if Executive is a specified employee as of the Date of Separation from Service, then to the extent, and only to the extent, necessary to comply with Code Section 409A: (i) if any payment or distribution is payable hereunder in a lump sum, Executive’s right to receive payment or distribution will be delayed until the earlier of Executive’s death or the 7th month following the Date of Separation from Service, and (ii) if any payment, distribution or benefit is payable or provided hereunder over time, the amount of such payment, distribution or benefit that would otherwise be payable or provided during the 6 month period immediately following the Date of Separation from Service will be accumulated, and Executive’s right to receive such accumulated payment, distribution or benefit will be delayed until the earlier of Executive’s death or the seventh month following the Date of Separation from Service and paid or provided on the earlier of such dates, without interest, and the normal payment or distribution schedule for any remaining payments, distributions or benefits will commence. For purposes of this Agreement, Executive shall be a “specified executive” during the 12 month period beginning April 1 each year if the Executive met the requirements of Section 416(i)(1)(A)(i), (ii) or (iii) of the Code (applied in accordance with the regulations thereunder and disregarding Section 416(i)(5) of the Code) at any time during the 12 month period ending on the December 31 immediately preceding the Date of Separation from Service.
Special Rule for Specified Employees. Notwithstanding the foregoing, if an amount becomes payable under the above rules due to the Employee incurring a "separation from service" within the meaning of Section 409A of the Code (for this purpose, payments on account of death are not considered payments made on account of separation from service), and the Employee is a "specified employee" (within the meaning of Section 409A of the Code) as of the date of separation from service, the Employee's "earned" Incentive Stock Rights that are vested as of the date of the Employee's separation from service shall be paid/distributed as net shares of Common Stock (net of tax withholdings) on or after the first day of the seventh month after the Employee's separation from service and before the 15th day of the seventh month following the date the Employee separates from service.
Special Rule for Specified Employees. If, as of the date of the Participant’s “separation from service” from the Company, the Participant is a “specified employee” (within the meaning of Section 409A of the Code) and pursuant to Section 3(b) above the Participant would otherwise be permitted to exercise this option within the six-month period following the date of the Participant’s “separation from service” from the Company, then the first permitted exercise date shall instead be the date that is six months and one day after such date of separation from service (or, if earlier, sixty (60) days after the Participant’s death).