Common use of Tax Gross-Up Payment Clause in Contracts

Tax Gross-Up Payment. In the event that any amount arising from this Agreement is includable in Executive’s gross income for a taxable year of the Executive under Section 409A of the Internal Revenue Code as the result of the terms of this Agreement and/or the administration of those terms (“the Included Amount”), then the Company shall pay to the Executive an amount equal to the 20% additional tax imposed under Section 409A on the Included Amount, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination by the Executive, or any claim by any taxing authority, that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paid. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunder.

Tax Gross-Up Payment. In the event that any amount arising from this Agreement is includable it shall be determined in Executive’s gross income for a taxable year of the Executive under Section 409A of the Internal Revenue Code as the result of the terms of this Agreement and/or the administration of those terms (“the Included Amount”), then the Company shall pay to the Executive an amount equal to the 20% additional tax imposed under Section 409A on the Included Amount, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined written opinion by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result firm of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination certified public accountants selected by the Executive, or any claim by any taxing authority, that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten Bank (10) business days after the Executive makes such determination or is informed of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paid. If the Company gives the Executive written notice at least made within thirty (30) days prior of a request by the Executive following a Change of Control) or by the Internal Revenue Service that any payment or distribution by the Bank to or for the benefit of the Executive under this Agreement would be subject to the excise tax imposed by Section 4999 of the Code (such excise tax, together with any interest and penalties accrued due date for payment to the Executive’s failure to pay or underpayment of such Additional tax in reliance on the opinion of the Bank’s firm of certified public accountants, are hereinafter collectively referred to as the “Excise Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later”)), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and then the Executive shall consult with each other and their respective tax advisors regarding the be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount and such that after payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion Executive of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax taxes (including any interest and or penalties imposed with respect thereto) and to such taxes), including any Excise Tax, imposed upon the Company’s Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. The Executive shall promptly notify the Bank in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Bank of the Gross-Up Payment. The Executive shall provide the Bank with a reasonable opportunity to contest such claim. Any Gross-Up Payment, as determined pursuant to this Section 4.4, shall be paid by the Bank to the Executive or to the applicable taxing authorities on or before the date on which such taxes are due, but, for purposes of Code Section 409A, in all events by the end of the Executive’s costs and expenses hereundertaxable year following the Executive’s taxable year in which the Executive remits or is required to remit the related taxes (however, this period is by no means an outside payment date nor does it diminish the Executive’s right to be paid promptly).

Tax Gross-Up Payment. (a) Anything in this Agreement to the contrary notwithstanding and except as set forth below and in Section 6.8, in the event it shall be determined that any Payment would be subject to the excise tax imposed under Section 4999 of the Code, then Executive shall be entitled to receive a Tax Gross Up Payment with respect to all such excise taxes. Notwithstanding the foregoing provisions of this Section 6.7, if the Parachute Value of all Payments does not exceed one hundred and ten percent (110%) of the Safe Harbor Amount, then except as provided below, no Gross-Up Payment shall be made to Executive and the amounts payable under this Agreement, other than amounts or benefits provided to Executive under Article V of this Agreement (pertaining to Equity Incentive Compensation) (the “Subject Payments”), shall be reduced (but not below zero) so that the Parachute Value of all Payments, in the aggregate, equals the Safe Harbor Amount. The reduction of the amounts payable hereunder, if applicable, shall be made by first reducing the payments under Section 7.3(b) or 7.4(a), as applicable, unless an alternative method of reduction is elected by Executive, and in any event shall be made in such a manner as to maximize the economic present value of all Payments actually made to Executive. For purposes of reducing the Payments to the Safe Harbor Amount, only the Subject Payments shall be reduced. If the reduction of the Subject Payments would not result in a reduction of the Parachute Value of all Payments to the Safe Harbor Amount, no amounts payable under the Agreement shall be reduced pursuant to this Section 6.7(a), and the Tax Gross-Up Payment shall be made to Executive. The Company’s obligation to make the Tax Gross-Up Payments under this Section 6.7 shall not be conditioned upon Executive’s Termination of Employment. (b) All determinations required to be made under this Section 6.7, including whether and when a Gross-Up Payment is required, the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by such nationally recognized certified public accounting firm as may be designated by Executive (the “Accounting Firm”). The Accounting Firm shall provide detailed supporting calculations both to the Committee and Executive within fifteen (15) business days of the receipt of notice from Executive that there has been a Payment or such earlier time as is requested by the Committee. In the event that any amount arising from this Agreement the Accounting Firm is includable in Executive’s gross income serving as accountant or auditor for a taxable year the individual, entity or group effecting the Change of Control, Executive may appoint another nationally recognized accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Tax Gross-Up Payment, as determined pursuant to this Section 6.7, shall be paid by the Company to Executive under Section 409A within five (5) business days of the Internal Revenue Code as receipt of the Accounting Firm’s determination. Any determination by the Accounting Firm shall be binding upon the Company and Executive. As a result of the terms of this Agreement and/or the administration of those terms (“the Included Amount”), then the Company shall pay to the Executive an amount equal to the 20% additional tax imposed under Section 409A on the Included Amount, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible uncertainty in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day 4999 of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give Code at the Company written notice time of any the initial determination by the ExecutiveAccounting Firm hereunder, or any claim it is possible that Tax Gross-Up Payments that will not have been made by any taxing authoritythe Company should have been made (the “Underpayment”), that he owes Additional Tax as consistent with the result of calculations required to be made hereunder. In the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after event the Executive makes such determination or is informed of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paid. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for make a payment of such Additional Taxany excise tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or Accounting Firm shall determine the amount of the Additional Tax, the Company Underpayment that has occurred and the Executive any such Underpayment shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested be promptly paid by the Company to contest or for the inclusion benefit of the Included Amount and/or the amount Executive. Notwithstanding any other provision of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Taxthis Section 6.7, the Company shall bear may, in its sole discretion, withhold and pay directly over to the Internal Revenue Service or any other applicable taxing authority, for the benefit of Executive, all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with or any such contestportion of any Tax Gross-Up Payment, and shall indemnify and hold the Executive harmless, on an after-tax basis, hereby consents to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereundersuch withholding.

Tax Gross-Up Payment. In the event that any amount arising from there shall occur a Change in Control of the Company, if the Executive becomes entitled to one or more payments (with a "payment" including, without limitation, the vesting of an option or other non-cash benefit or property), whether pursuant to the terms of this Agreement is includable in Executive’s gross income for a taxable year of or any other plan, arrangement, or agreement with the Executive under company or any affiliated company (the "Total Payments"), which are or become subject to the tax imposed by Section 409A 4999 of the Internal Revenue Code as (the result "Code") (or any similar tax that may hereafter be imposed) (the "Excise Tax"), an additional amount shall be payable to the Executive at the time specified below pursuant to Section 5(b)(ii) about the (the Gross-up Payment") (which shall include, without limitation, reimbursement for any penalties and interest that may accrue in respect of such Excise Tax) such that the net amount retained by the Executive, after reduction for any Excise Tax (including any penalties or interest thereon) on the Total Payments and any federal, state and local income or employment tax and Excise Tax on the Gross-up Payment provided for by this paragraph 6, but before reduction for any federal, state, or local income or employment tax on the Total Payments, shall be equal to the sum of (A) the Total Payments, and (B) an amount equal to the product of any deductions disallowed for federal, state, or local income tax purposes because of the terms inclusion of this Agreement and/or the administration Gross-up Payment in the Executive's adjusted gross income multiplied by the highest applicable marginal rate of federal, state, or local income taxation, respectively, for the calendar year in which the Gross-up Payment is to be made. For purposes of determining whether any of the Total Payments will be subject to the Excise Tax and the amount of such Excise Tax: (A) The Total Payments shall be treated as "parachute payments" within the meaning of Section 280G(b)(2) of the Code, and all "excess parachute payments" within the meaning of Section 280G(b)(l) of the Code shall be treated as subject to the Excise Tax, unless and except to the extent that, in the written opinion of independent compensation consultants or auditors of nationally recognized standing ("Independent Advisors") selected by the Company and reasonably acceptable to the Executive, the Total Payments (in whole or in part) do not constitute parachute payments, or such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code in excess of the base amount within the meaning of Section 280G(b)(3) of the Code or are otherwise not subject to the Excise Tax; (B) The amount of the Total Payments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the total amount of the Total Payments or (B) the total amount of excess parachute payments within the meaning of section 280G(b)(l) of the Code (after applying clause (A) above); and (C) The value of any non-cash benefits or any deferred payment or benefit shall be determined by the Independent Advisors in accordance with the principles of Section 280G(d)(3) and (4) of the Code. For the purposes of determining the amount of the Gross-up Payment, the Executive shall be deemed (A) to pay federal income taxes at the highest marginal rate of federal income taxation for the calendar year in which the Gross-up Payment is to be made; (B) to pay any applicable state and local income taxes at the highest marginal rate of taxation for the calendar year in which the Gross-up payment is to be made, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes if paid in such year (determined without regard to limitations on deductions based upon the amount of the Executive's adjusted gross income); and (C) to have otherwise allowable deductions for federal, state, and local income tax purposes at least equal to those terms disallowed because of the inclusion of the Gross-up Payment in the Executive's adjusted gross income. In the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder at the time the Gross-up Payment is made, the Executive shall repay to the Company at the time that the amount of such reduction in Excise Tax is finally determined (“but, if previously paid to the Included Amount”taxing authorities, not prior to the time the amount of such reduction is refunded to the Executive or otherwise realized as a benefit by the Executive) the portion of the Gross-up Payment that would not have been paid if such Excise Tax had been applied in initially calculating the Gross-up Payment, plus interest on the amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to exceed the amount taken into account hereunder at the time the Gross-up Payment is made (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-up Payment), then the Company shall make an additional Gross-up Payment in respect of such excess (plus any interest and penalties payable with respect to such excess) at the time that the amount of such excess is finally determined. The Gross-up Payment provided for above shall be paid on the 30th day (or such earlier date at the Excise Tax becomes due and payable to the taxing authorities) after it has been determined that the Total Payments (or any portion thereof) are subject to the Excise Tax; provided, however, that if the amount of such Gross-up Payment or portion thereof cannot be finally determined on or before such day, the Company shall pay to the Executive on such day an estimate, as determined by the Independent Advisors, of the minimum amount equal of such payments and shall pay the remainder of such payments (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code), as soon as the amount thereof can be determined. In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by the Company to the 20% additional tax imposed under Section 409A Executive, payable on the Included Amount, fifth day after demand by the Company (together with any underpayment penalties and interest (at the “Additional Tax”rate provided in Section 1274(b)(2)(B) resulting from the inclusion of the additional amountCode). The Company also will pay If more than one Gross-up Payment is made, the Executive an additional amount necessary of each Gross-up Payment shall be computed so as not to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a duplicate any prior Gross-up Payment, Executive must give . The Company shall have the Company written notice right to control all proceedings with the Internal Revenue Service that may arise in connection with the determination and assessment of any determination by the ExecutiveExcise Tax and, or any claim by any taxing authority, that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paid. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Taxits sole option, the Company may pursue or forego any and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Taxall administrative appeals, proceedings, hearings, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest conferences with any taxing authority regarding the inclusion and/or the amount in respect of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Excise Tax (including any interest and or penalties thereon); providing, however, that the Company's control over any such proceedings shall be limited to issues with respect thereto) to which a Gross-up-Payment would be payable hereunder, and the Company’s payment Executive shall be entitled to settle or contest any other issue raised by the Internal Revenue Service or any other taxing authority. The Executive shall cooperate with the Company in any proceedings relating to the determination and assessment of any Excise Tax and shall not take any position or action that would materially increase the Executive’s costs and expenses hereunderamount of any Gross-up Payment.

Tax Gross-Up Payment. (a) In the event that any amount arising from this Agreement is includable in Executive’s gross income for a taxable year Payments would be subject to excise tax under Section 4999 of the Executive under Section 409A of Code (such excise tax and any penalties and interest collectively, the Internal Revenue Code as the result of the terms of this Agreement and/or the administration of those terms (“the Included AmountPenalty Tax”), then then, except in the case of a De Minimus Excess Amount (as described below), the Company shall pay to the Executive in cash an additional amount equal to the Tax Gross Up Payment. (b) In the event that the amount by which the present value of the Payments which constitute “parachute payments” (within the meaning of Section 280G of the Code) (the “Parachute Payments”) exceeds three (3) times the Executive’s “base amount” (within the meaning of Section 280G of the Code) (the “Base Amount”) is an amount that is less than 30% of the Base Amount, such excess shall be deemed to be a De Minimus Excess Amount and the Executive shall not be entitled to an Tax Gross-Up Payment. In such an instance, the Payments shall be reduced to an amount (the “Non-Triggering Amount”) such that the present value of the Parachute Payments is one dollar ($1.00) less than an amount equal to three (3) times Executive’s Base Amount. The reduction required hereby shall be made by first by reducing any cash severance amounts payable to Executive, then by reducing other cash amounts included in the 20Payments and finally, to the extent necessary, reducing non-cash amounts included in the Payments. The amount of any reduction pursuant to this Section 2(b) is referred to below as the “Reduction Amount.” (c) In the event the present value of the Parachute Payments exceed the Non-Triggering Amount by more than 30% additional of the Base Amount, then the Company shall pay the Tax Gross Up Payment to the Executive. The “Tax Gross Up Payment” shall be an amount such that after payment by the Executive of all federal, state, local, employment and Medicare taxes thereon (and any penalties and interest with respect thereto), the Executive retains on an after tax basis a portion of such amount equal to the aggregate of 100% of the Penalty Tax imposed upon the Payments and 100% of the Penalty Tax imposed upon the Tax Gross Up Payment. For purposes of determining the amount of the Tax Gross Up Payment, the value of any non-cash benefits and deferred payments or benefits subject to the Penalty Tax shall be determined by the Company’s independent tax advisor in accordance with the principles of Section 280G(d)(3) and (4) of the Code. The Tax Gross Up Payment less required tax withholding shall be paid by the Company to the Executive on or within five business days after the earlier of (i) the date the Company and/or any of its subsidiaries is required to withhold tax with respect to any Payment or (ii) the date any Penalty Tax is required to be paid by the Executive. As a result of uncertainty in the application of Sections 280G and 4999 of the Code at the time the determinations are made under this Section 2, or as a result of a subsequent determination by the Internal Revenue Service or a judicial authority, it is possible that the Company should have made Tax Gross-Up Payments and, the reduction, if any, of the Payments pursuant to Section 2(b) should not have been made (collectively an “Underpayment”), or that Tax Gross Up Payments will have been made by the Company which should not have been made and, if applicable, a reduction of the Payments under Section 409A on 2(b) should have occurred (collectively an “Overpayment”). In the Included Amountcase of the Underpayment, the amount of such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive. In the case of an Overpayment, the Executive shall, at the direction and expense of the Company, take such steps as are reasonably necessary (including the filing of returns and claims for refund), follow reasonable instructions from, and procedures established by, the Company, and otherwise reasonably cooperate with the Company to correct such Overpayment, including repayment of such Overpayment to the Company. Notwithstanding the foregoing, in the event the Executive experiences a Termination for Cause within one year of the Change in Control, then in that event, (a) if such termination occurs prior to the payment to the Executive of any Tax Gross Up Payment, then the Executive shall not be entitled to receive any Tax Gross Up Payment, or (b) if such termination occurs after an Tax Gross Up Payment has been made to the Executive, then the Executive shall remit to the Company within five days after such termination the full amount of the Tax Gross Up Payments thereto are paid to the Executive and the Executive shall not be entitled to receive any other payments pursuant to this Section 2. However, if it is later determined that the Executive’s Termination for Cause was improper, then the Executive shall be entitled to receive the Tax Gross Up Payment, together with any underpayment penalties actual consequential and interest (the “Additional Tax”) resulting incidental damages arising from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible delay in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination by the Executive, or any claim by any taxing authority, that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed his receipt of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paid. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunderpayments.

Tax Gross-Up Payment. In the event If it shall be finally determined that any amount arising from payment to Employee pursuant to this Agreement is includable in Executive’s gross income for a taxable year of or any other payment or benefit from AutoZone, any affiliate, or any other person would be subject to the Executive under excise tax imposed by Section 409A 4999 of the Internal Revenue Code of 1986, as the result of the terms of this Agreement and/or the administration of those terms (“the Included Amount”), then the Company shall pay to the Executive an amount equal to the 20% additional tax imposed under Section 409A on the Included Amount, together with any underpayment penalties and interest amended (the “Additional Tax”) resulting from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination by the Executive"Code"), or any claim by similar tax payable under any taxing authorityUnited States federal, that he owes Additional state, local or other law, then Employee shall receive a Tax Gross-Up Payment with respect to all such excise taxes and similar taxes (collectively, the "Excise Tax"). An initial determination as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or to whether a Tax Gross-Up Payment is informed of such claim, The notice must, required pursuant to the extent Executive has or may reasonably obtain such information, apprise the Company of this Agreement and the amount of such Additional Tax Gross-Up Payment shall be made at AutoZone's expense by a nationally recognized accounting firm selected by AutoZone (the "Accounting Firm"). The determination by the Accounting Firm (the "Determination") shall be binding, final and conclusive upon AutoZone and the date on which it is required to be paidEmployee for purposes of any dispute between the parties hereto. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and the Executive The parties hereto shall consult cooperate with each other and their respective tax advisors regarding the amount and payment of in connection with any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with proceeding or claim involving any taxing authority regarding under this Paragraph 27 relating to the inclusion and/or the existence or amount of any liability for the Additional Excise Tax; provided, the Company however, that AutoZone shall control all proceedings taken in connection with such proceeding or claim and shall bear and pay directly all costs costs, expenses, and expenses (including additional interest, tax penalties and legal fees) interest incurred in connection with such proceeding or claim. As a result of uncertainty in the application of Section 4999 of the Code at the time of the initial Determination by the Accounting Firm, it is possible that the Tax Gross-Up Payment made will have been an amount less than AutoZone should have paid pursuant to this Paragraph 27 (the "Underpayment") or an amount greater than AutoZone should have paid pursuant to this Paragraph 27 (the "Overpayment"). In the event that it is finally determined that an Underpayment exists and the Employee is required to make a payment of any such contestExcise Tax, the Tax Gross-Up Payment shall be adjusted accordingly and the shortfall shall indemnify and hold the Executive harmless, on an after-tax basis, be promptly paid by AutoZone to the extent not otherwise Employee or for his benefit. In the event that it is finally determined that an Overpayment exists and AutoZone paid a Tax Gross-Up Payment to the Employee in excess of the amount of the Tax Gross-Up Payment to which he is actually entitled hereunder, on such excess shall be promptly reimbursed by the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunderEmployee to AutoZone.

Tax Gross-Up Payment. In the event that any amount arising from this Agreement is includable in Executive’s gross income for it shall be determined, either by the Company or by a taxable year of the Executive under Section 409A final determination of the Internal Revenue Code as Service, that any payment, distribution or benefit by or from the result Company to or for the benefit of Mr. English pursuant to Section 6.2(g)(i) or otherwise (the “Payment”) would cause Mr. English to become subject to the excise tax imposed by Section 4999 of the terms of this Agreement and/or Code (the administration of those terms (“the Included AmountExcise Tax”), then the Company shall pay to or for the Executive benefit of Mr. English, within the later of ninety (90) days of the termination date of Mr. English’s employment or ninety (90) days of the date of determination referred to above, an additional amount (the “Gross-Up Payment”) in an amount that shall fund the payment by Mr. English of any Excise Tax on the Payment, as well as any income taxes imposed on the Gross-Up Payment, any Excise Tax imposed on the Gross-Up Payment and any interest or penalties imposed with respect to taxes on the Gross-Up Payment or any Excise Tax. For purposes of determining the amount of the Gross-Up Payment, Mr. English shall be deemed to pay federal, state and local income taxes at the highest nominal marginal rate of such federal, state and local income taxation in the calendar year in which the Gross-Up Payment is due, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. In the event that Excise Tax is subsequently determined to be less than the amount taken into account to determine the amount of the Gross-Up Payment, then Mr. English shall repay to the Company at that time the portion of the Gross-Up Payment attributable to such reduction (plus an amount equal to the 20% additional any tax imposed under Section 409A on the Included Amountreduction, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion whether of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional Excise Tax, any applicable income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination by the Executivetax, or any claim by any taxing authorityapplicable employment tax, that he owes Additional Tax which Mr. English has received as the a result of such initial repayment). In the inclusion event that the Excise Tax is subsequently determined, whether by the Company or by a final determination of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed of such claim, The notice mustInternal Revenue Service, to be more than the extent Executive has or may reasonably obtain such information, apprise the Company of amount taken into account to determine the amount of the Gross-Up payment, then the Company shall pay to Mr. English an additional amount, which shall be determined using the same methods as were used for calculating the Gross-Up Payment, with respect to such Additional excess. For purposes of this Section 6.2(g), a determination of the Internal Revenue Service as to the amount of Excise Tax for which Mr. English is liable shall not be treated as final until the time that either (i) the Company agrees to acquiesce to the determination of the Internal Revenue Service or (ii) the determination of the Internal Revenue Service has been upheld in a court of competent jurisdiction and the date on which it Company decides not to appeal such judicial decision or such decision is required to be paidnot appeasable. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes chooses to contest the inclusion determination of the Included Amount and/or the amount of the Additional TaxInternal Revenue Service, the Company then all costs, attorneys’ fees, charges assessed and the Executive other expenses shall consult with each other be borne and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested paid when due by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunder.

Tax Gross-Up Payment. In (A) Anything in any other agreement or arrangement between the Company and the Executive notwithstanding, in the event it shall be determined by the Accounting Firm (as defined below) that any amount arising from this Agreement is includable in Executive’s gross income compensation, payment, award, benefit or distribution (or any acceleration of any compensation, payment, award, benefit or distribution) by the Company or Parent (or any of their respective affiliates or successors) to or for a taxable year the benefit of the Executive under Section 409A of the Internal Revenue Code as the result of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement and/or Agreement, or otherwise paid or payable or distributed or distributable in connection with and contingent upon the administration transactions contemplated under the Mergers (as defined in the Merger Agreement), within the meaning of those terms Section 280G of the Code (collectively, the “Parachute Payments”), exceed more than 110% of the Included AmountExecutive’s Threshold Amount (as defined below) and would be subject to the excise tax imposed by Section 4999 of the Code (such excise tax is hereinafter referred to as the “Excise Tax”), then the Company Executive shall pay be entitled to the Executive receive an additional cash payment (a “Tax Gross-Up Payment”) in an amount equal to the 20% additional tax imposed under Section 409A on amount necessary such that the Included Amount, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion net amount of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination Up Payment retained by the Executive, or after deduction of any claim federal, state and local income taxes, employment tax and Excise Tax upon the payment provided by this subsection, and any taxing authorityinterest and/or penalties assessed with respect to such Excise Tax, shall be equal to the Excise Tax imposed on the Parachute Payments; provided, however, that he owes Additional Tax as if the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed of such claim, The notice must, Accounting Firm determines that any and all amounts payable pursuant to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax this Agreement and the date on which it is required to be paid. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred Gross-Up Agreement entered into in connection with any such contestthe Merger Agreement (the “Aggregate Tax Gross-Up Payments”) exceed, and shall indemnify and hold or are reasonably likely to exceed, $4.0 million in the Executive harmlessaggregate (the “Aggregate Cap”), on an afterthen the Aggregate Tax Gross-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax Up Payments (including any interest and penalties with respect theretothe Tax Gross-Up Payment) and shall be proportionately reduced such that the Company’s payment of the Executive’s costs and expenses hereunder.Aggregate Tax Gross-Up Payments are equal

Tax Gross-Up Payment. (a) In the event that any amount arising from this Agreement is includable in Executive’s gross income for a taxable year Payments would be subject to excise tax under Section 4999 of the Executive under Section 409A of Code (such excise tax and any penalties and interest collectively, the Internal Revenue Code as the result of the terms of this Agreement and/or the administration of those terms (“the Included AmountPenalty Tax”), then then, except in the case of a De Minimus Excess Amount (as described below), the Company shall pay to the Executive in cash an additional amount equal to the Tax Gross Up Payment. (b) In the event that the amount by which the present value of the Payments which constitute “parachute payments” (within the meaning of Section 280G of the Code) (the “Parachute Payments”) exceeds three (3) times the Executive’s “base amount” (within the meaning of Section 280G of the Code) (the “Base Amount”) is an amount that is less than 30% of the Base Amount, such excess shall be deemed to be a De Minimus Excess Amount and the Executive shall not be entitled to an Tax Gross-Up Payment. In such an instance, the Payments shall be reduced to an amount (the “Non-Triggering Amount”) such that the present value of the Parachute Payments is one dollar ($1.00) less than an amount equal to three (3) times Executive’s Base Amount. The reduction required hereby shall be made by first by reducing any cash severance amounts payable to Executive, then by reducing other cash amounts included in the 20Payments and finally, to the extent necessary, reducing non-cash amounts included in the Payments. The amount of any reduction pursuant to this Section 2(b) is referred to below as the “Reduction Amount.” (c) In the event the present value of the Parachute Payments exceed the Non-Triggering Amount by more than 30% additional of the Base Amount, then the Company shall pay the Tax Gross Up Payment to the Executive. The “Tax Gross Up Payment” shall be an amount such that after payment by the Executive of all federal, state, local, employment and Medicare taxes thereon (and any penalties and interest with respect thereto), the Executive retains on an after tax basis a portion of such amount equal to the aggregate of 100% of the Penalty Tax imposed upon the Payments and 100% of the Penalty Tax imposed upon the Tax Gross Up Payment. For purposes of determining the amount of the Tax Gross Up Payment, the value of any non-cash benefits and deferred payments or benefits subject to the Penalty Tax shall be determined by the Company’s independent tax advisor in accordance with the principles of Section 280G(d)(3) and (4) of the Code. The Tax Gross Up Payment less required tax withholding shall be paid by the Company to the Executive on or within five business days after the earlier of (i) the date the Company and/or any of its subsidiaries is required to withhold tax with respect to any Payment or (ii) the date any Penalty Tax is required to be paid by the Executive. As a result of uncertainty in the application of Sections 280G and 4999 of the Code at the time the determinations are made under this Section 2, or as a result of a subsequent determination by the Internal Revenue Service or a judicial authority, it is possible that the Company should have made Tax Gross-Up Payments and, the reduction, if any, of the Payments pursuant to Section 2(b) should not have been made (collectively an “Underpayment”), or that Tax Gross Up Payments will have been made by the Company which should not have been made and, if applicable, a reduction of the Payments under Section 409A on 2(b) should have occurred (collectively an “Overpayment”). In the Included Amountcase of the Underpayment, the amount of such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive. In the case of an Overpayment, the Executive shall, at the direction and expense of the Company, take such steps as are reasonably necessary (including the filing of returns and claims for refund), follow reasonable instructions from, and procedures established by, the Company, and otherwise reasonably cooperate with the Company to correct such Overpayment, including repayment of such Overpayment to the Company. Notwithstanding the foregoing, in the event the Executive experiences a Termination for Cause within one year of the Change in Control, then in that event, (a) if such termination occurs prior to the payment to the Executive of any Tax Gross Up Payment, then the Executive shall not be entitled to receive any Tax Gross Up Payment, or (b) if such termination occurs after an Tax Gross Up Payment has been made to the Executive, then the Executive shall remit to the Company within five days after such termination the full amount of the Tax Gross Up Payments thereto are paid to the Executive and the Executive shall not be entitled to receive any other payments pursuant to this Section 2. However, if it is later determined that the Executive’s Termination for Cause was improper, then the Executive shall be entitled to receive the Tax Gross Up Payment, together with any underpayment penalties actual consequential and interest (the “Additional Tax”) resulting incidental damages arising from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible delay in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give the Company written notice of any determination by the Executive, or any claim by any taxing authority, that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed his receipt of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional Tax and the date on which it is required to be paidpayments. If the Company gives the Executive written notice at least thirty (30) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or the amount of the Additional Tax, the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunder3.

Tax Gross-Up Payment. (a) In the event it shall be determined that any amount arising from payments, benefits or distributions by the Company, any person or entity whose actions result in a Change in Control or any person or entity affiliated with the Company or such person or entity, to or for Optionee’s benefit (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement is includable in Executive’s gross income for a taxable year of Agreement, any other agreement or otherwise, but determined without regard to any payments required under this Section 9) (collectively, the Executive under “Payments”) would be subject to the excise tax imposed by Section 409A 4999 of the Internal Revenue Code (the “Code”) or Optionee incurs any interest or penalties with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the result of the terms of this Agreement and/or the administration of those terms (“the Included AmountExcise Tax”), then Optionee shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that, after payment of all taxes (and any interest or penalties imposed with respect to such taxes), including any income taxes and Excise Tax imposed upon the Gross-Up Payment, Optionee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Subsection (d), below, all determinations required to be made under this Section 9, including whether and when a Gross-Up Payment is required and the amount such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by an accounting firm of national reputation selected by the Company ( the “Accounting Firm”), which shall provide detailed supporting calculations both to Optionee and to the Company within fifteen (15) business days of the receipt of notice from Optionee that there has been a Payment, or such earlier time as is requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Company shall pay appoint another nationally recognized accounting firm to make the Executive an amount equal determinations required hereunder (which accounting firm shall then be referred to the 20% additional tax imposed under Section 409A on the Included Amount, together with any underpayment penalties and interest (as the “Additional Tax”) resulting from the inclusion Accounting Firm” hereunder). All fees and expenses of the additional amountAccounting Firm shall be borne solely by the Company. The Any Gross-Up Payment, as determined pursuant to this Section 9, shall be paid by the Company also will pay on Optionee’s behalf within five days of the Executive an additional amount necessary receipt of the Accounting Firm’s determination. If the Accounting Firm determines that no Excise Tax is payable, it shall furnish evidence of its determination that failure to “gross up” report the Executive for additional Excise Tax on Optionee’s applicable federal income taxes on tax return would not result in the Additional Tax payment, on imposition of a penalty. Any determination by the earlier of Accounting Firm shall be binding upon Optionee and the Company. (ac) the thirtieth day following the date on which it is finally determined by As a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of uncertainty in the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day 4999 of the Executive’s next taxable year. To receive a Gross-up Payment, Executive must give Code at the Company written notice time of any the initial determination by the ExecutiveAccounting Firm hereunder, it is possible that Gross-Up Payments which should have been made by the Company will not have been made (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Subsection (d) below and Optionee thereafter is required to make a payment of any additional Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for Optionee’s benefit. (d) Optionee shall notify the Company in writing of any claim by the Internal Revenue Service or any other taxing authorityauthority that, that he owes Additional Tax as if successful, would require the result payment by the Company of the inclusion of the Included Amount any Gross-Up Payment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed Optionee knows of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, claim and shall apprise the Company of the amount nature of such Additional Tax claim and the date on which it such claim is required requested to be paid. Optionee shall not pay such claim prior to the expiration of the thirty (30)-day period following the date on which Optionee gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company gives the Executive written notice at least thirty (30) days notifies Optionee in writing prior to the due date for payment expiration of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), period that it disagrees with or wishes desires to contest the inclusion of the Included Amount and/or the amount of the Additional Taxsuch claim, Optionee shall: (i) give the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps information reasonably requested by the Company relating to such claim; (ii) take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including accepting legal representation with respect to such claim by an attorney reasonably selected by the Company; (iii) cooperate with the Company in good faith in order to effectively contest such claim; and (iv) permit the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from Company to participate in any proceedings relating to such inclusionclaim; provided, provided however, that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties interest and legal feespenalties) incurred in connection with any such contest, contest and shall indemnify and hold the Executive Optionee harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional for any Excise Tax or income tax (including any interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Subsection (d), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Optionee to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and Optionee agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine. If the Company directs Optionee to pay such claim and xxx for a refund, the Company shall: (i) to the extent not prohibited by law, rule or regulation, advance the amount of such payment on an interest-free basis; or (ii) to the extent any such advance is so prohibited, pay such amount directly; and, in either case, shall indemnify and hold Optionee harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such payment or advance or with respect to any imputed income with respect to such payment or advance; and provided further that any extension of the statute of limitations relating to payment of taxes for Optionee’s taxable year with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s payment control of the Executivecontest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Optionee shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. (e) If, after Optionee’s costs receipt of an amount advanced by the Company pursuant to Subsection (d), above, Optionee becomes entitled to receive any refund with respect to such claim, Optionee shall (subject to the Company’s complying with the requirements of Subsection (d)) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after Optionee’s receipt of an amount advanced by the Company pursuant to Subsection (d), above, a determination is made that Optionee shall not be entitled to any refund with respect to such claim and expenses hereunderthe Company does not notify Optionee in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid. (f) The parties acknowledge and agree that, to the extent applicable, this Section 9 shall be interpreted in accordance with, and the parties agree to use their best efforts to achieve timely compliance with, Section 409A of the Code and the Department of Treasury regulations and other interpretive guidance issued thereunder.

Tax Gross-Up Payment. In the event that 11.1 If any amount arising from payments under this Agreement is includable in Executive’s gross income for a taxable year of or any other payments or benefits received or to be received by the Executive under Section 409A (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company) (the "Severance Payments"), will be subject to the tax (the "Excise Tax") imposed by section 4999 of the Internal Revenue Code as (the result of the terms of this Agreement and/or the administration of those terms "Code") (“the Included Amount”or any similar tax that may hereafter be imposed), then the Company shall pay at the time specified below, an additional amount (the "Gross-Up Payment") such that the net amount retained by the Executive, after deduction of any Excise Tax on the Severance Payments and any federal, state and local income tax and Excise Tax upon the payment provided for by this Section 11, shall be equal to the Severance Payments. For purposes of determin ing whether any of the Severance Payments will be subject to the Excise Tax and the amount of such Excise Tax, (a) all Severance Payments shall be treated as "parachute payments" within the meaning of section 28OG(2) of the Code, and all "excess parachute payments" within the meaning of section 28OG(b)(1) shall be treated as subject to the Excise Tax, unless in the opinion of tax counsel selected by the Company's independent auditors and acceptable to the Executive an such Severance payments (in whole or in part) do not constitute parachute payments, or such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered within the meaning of section 28OG(b)(4) of the Code in excess of the base amount equal within the meaning of section 28OG(b)(3) of the Code, or are otherwise not subject to the 20% additional tax imposed under Section 409A on the Included AmountExcise Tax, together with any underpayment penalties and interest (the “Additional Tax”) resulting from the inclusion of the additional amount. The Company also will pay the Executive an additional amount necessary to “gross up” the Executive for additional income taxes on the Additional Tax payment, on the earlier of (a) the thirtieth day following the date on which it is finally determined by a court or administrative agency that the Included Amount was includible in Executive’s gross income as the result of the application of Section 409A(a)(1)(B) to the Included Amount; or (b) the last day amount of the Severance Pay- ments which shall be treated as subject to the Excise Tax shall be equal to the lesser of (1) the total amount of the Severance Payments or (2) the amount of excess parachute payments within the meaning of section 28OG(b)(1) (after applying clause (a), above), and (c) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Company's independent auditors in accordance with the principles of section 28OG(d)(3) and (4) of the Code. For purposes of determining the amount of the Gross-Up Payment, the Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of the Executive’s next taxable year's residence on the Termination Date, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. To receive a Gross-up PaymentIn the event that the Excise Tax is subsequently determined to be less than the amount taken into account hereunder at the time of termination of the Executive's employment, the Executive must give shall repay to the Company written notice of any determination by at the Executive, or any claim by any taxing authority, time that he owes Additional Tax as the result of the inclusion of the Included Amount as soon as practicable but no later than ten (10) business days after the Executive makes such determination or is informed of such claim, The notice must, to the extent Executive has or may reasonably obtain such information, apprise the Company of the amount of such Additional reduction in Excise Tax is finally determined the portion of the Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and federal and state and local income tax imposed on the date on which it is required to be paid. If the Company gives Gross-Up Payment being repaid by the Executive written notice at least thirty (30if such repayment results in a reduction in Excise Tax and/or a federal and state and local income tax deduction) days prior to the due date for payment of such Additional Tax, or within ten (10) business days of having received the foregoing notice from the Executive (whichever is later), that it disagrees with or wishes to contest the inclusion of the Included Amount and/or plus interest on the amount of such repayment at the Additional Tax, the Company and the Executive shall consult with each other and their respective tax advisors regarding the amount and payment of any Additional Tax, and Executive will take all reasonable steps requested by the Company to contest the inclusion of the Included Amount and/or the amount of the Additional Tax resulting from such inclusion, rate provided that in the event there is a contest with any taxing authority regarding the inclusion and/or the amount of the Additional Tax, the Company shall bear and pay directly all costs and expenses (including additional interest, penalties and legal fees) incurred in connection with any such contest, and shall indemnify and hold the Executive harmless, on an after-tax basis, to the extent not otherwise paid hereunder, on the Additional Tax (including any interest and penalties with respect thereto) and the Company’s payment of the Executive’s costs and expenses hereunder.section