Termination Compensation and Benefits. 7.1. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's Base Salary (to the Executive or in accordance with Section 11.2 if the Executive's employment is terminated by his death) through the Date of Termination at the rate in effect at the time the Notice of Termination is given, together with all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination under the terms of any compensation or benefit plan, program or arrangement maintained by the Company during such period. 7.2. In the event the Executive's employment is terminated prior to the expiration of the Term of the Agreement by the Executive for Good Reason or by the Company for reasons other than Cause (other than the death or Disability of the Executive), the Executive shall receive (i) continuation of his Base Salary and the benefits provided for in Sections 5.2 and 5.3 of this Agreement for the remainder of the Term, (ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount equal to the actual fee for such service up to a total of $10,000 and (iii) a lump sum payment equal to (A) the value of the fringe benefits that would have been provided to the Executive through the remainder of the Term in accordance with the Company's policies as of the date one year prior to the Date of Termination and (B) any unreimbursed expenses payable pursuant to Section 5.5 of this Agreement. For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the amount of short-term compensation received by the Executive in the fiscal year ended immediately prior to the Date of Termination and the value of long-term incentive compensation shall be the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided under Section 5.3 shall consist of continued accrual of benefits for the remainder of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof. Notwithstanding the foregoing, to the extent the Company determines for any reason not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, benefits provided under this Section 7.2 shall not be provided to the Executive to the extent such benefits would be duplicative of benefits provided elsewhere in this Agreement. 7.3. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become due and the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof. Such post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance with, the Company or its subsidiaries' retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this Agreement except as set forth in Section 5.2(a) hereof), as applicable. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by the Company or its affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the Code or 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 "Excise Tax"), then the Executive shall be entitled to receive an additional payment ("Gross-Up Payment") in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by the Company's principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by the Company or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he 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 notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: (i) give the Company any 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, without limitation, 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 Company to participate in any proceeding relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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; provided, however, that if the Company directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and provided, further that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive 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. 7.5. The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; provided, however, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). 7.6. The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any such termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); provided, however, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by the Company pursuant to Section 7.4(c) hereof in connection with which the Company complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require.

Appears in 1 contract

Samples: Employment Agreement (Energy East Corp)

Termination Compensation and Benefits. 7.1. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's Base Salary (to the Executive or in accordance with Section 11.2 if the Executive's employment is terminated by ~~his~~ her death) through the Date of Termination at the rate in effect at the time the Notice of Termination is given, together with all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination under the terms of any compensation or benefit plan, program or arrangement maintained by Energy East or the Company during such period. 7.2. In the event the Executive's employment is terminated prior to the expiration of the Term of the Agreement by the Executive for Good Reason or by Energy East or the Company for reasons other than Cause (other than the death or Disability of the Executive), the Executive shall receive (i) continuation of ~~his~~ her Base Salary and the benefits provided for in Sections 5.2 and 5.3 of this Agreement for the remainder of the ~~Term~~Term , (ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount equal to the actual fee for such service up to a total of $10,000 and (iii) a lump sum payment equal to (A) the value of the fringe benefits that would have been provided to the Executive through the remainder of the Term in accordance with the Company's policies as of the date one year prior to the Date of Termination and (B) any unreimbursed expenses payable pursuant to Section 5.5 of this Agreement. For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the amount of short-term compensation received by the Executive in the fiscal year ended immediately prior to the Date of Termination and the value of long-term incentive compensation shall be the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided under Section 5.3 shall consist of continued accrual of benefits for the remainder of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment~~; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~. Notwithstanding the foregoing, to the extent the Company and/or Energy East determines ~~for any reason~~ not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, benefits provided under this Section 7.2 shall not be provided to the Executive to the extent such benefits would be duplicative of benefits provided elsewhere in this Agreement. 7.3. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become ~~due and the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~due. Such post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance with, Energy East's or the ~~Company or its subsidiaries'~~ Company's retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this ~~Agreement except as set forth in Section 5.2(a) hereof~~Agreement), as applicable. . 7.4. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by Energy East, the Company or ~~its~~ their affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the Code or 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 "Excise Tax"), then the Executive shall be entitled to receive an additional payment ("Gross-Up Payment") in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by ~~the Company~~Energy East's principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by ~~the Company~~ Energy East or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon Energy East, the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that ~~the Company~~ Energy East exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify ~~the Company~~ Energy East in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise ~~the Company~~ Energy East of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he she gives such notice to ~~the Company~~ Energy East (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If ~~the Company~~ Energy East notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: : (i) give ~~the Company~~ Energy East any information reasonably requested by ~~the Company~~ Energy East relating to such claim; ; (ii) take such action in connection with contesting such claim as ~~the Company~~ Energy East shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by ~~the Company;~~ Energy East; (iii) cooperate with ~~the Company~~ Energy East in good faith in order to effectively contest such claim; ~~and~~ and (iv) permit ~~the Company~~ Energy East to participate in any proceeding relating to such claim; provided, however, that ~~the Company~~ Energy East shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), ~~the Company~~ Energy East shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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~~ Energy East shall determine; provided, however, that if ~~the Company~~ Energy East directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and provided, further that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, ~~the Company~~Energy East's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to Energy East's and the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and ~~the Company~~ Energy East does not notify the Executive 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. . 7.5. The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; provided, however, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). 7.6. The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any such termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); provided, however, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by the Company pursuant to Section 7.4(c) hereof in connection with which the Company complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require.

Appears in 1 contract

Samples: Employment Agreement (Central Maine Power Co)

Termination Compensation and Benefits. 7.1. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's Base Salary (to the Executive or in accordance with Section 11.2 if the Executive's employment is terminated by his death) through the Date of Termination at the rate in effect at immediately prior to the time the Notice of Termination is given, together with all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination or thereafter under the terms of any compensation or benefit plan, program or arrangement maintained by Parent, XENERGY or the Company during such period, and any unreimbursed expenses payable pursuant to Section 5.5 of the Agreement that were incurred before the Date of Termination. 7.2. In the event the Executive's employment is terminated prior to the expiration of the Term of the Agreement by the Executive for Good Reason or by Parent or the Company for reasons other than Cause (other than the death or Disability of the Executive), the Executive shall ~~receive~~ receive, in addition to amounts payable under Section 7.1 and 7.3, (i) ~~continuation~~ a lump sum cash payment to be made within five (5) days of ~~his~~ the Date of Termination equal to three times the sum of the Base Salary and incentive compensation (as described below), (ii) continuation of the benefits provided for in ~~Sections~~ Section 5.2 ~~and 5.3~~ of this Agreement for the remainder of the Term, ~~(ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount equal to the actual fee for such service up to a total of $10,000~~ and (iii) ~~a lump sum payment equal to~~ the Special Retirement Benefit (~~A) the value of the fringe benefits that would have been provided~~ to the ~~Executive through the remainder of the Term~~ extent provided for in ~~accordance with the Company's policies as of the date one year prior to the Date of Termination and (B) any unreimbursed expenses payable pursuant to~~ Section ~~5.5 of this Agreement~~5.8 hereof). For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the higher of (i) the amount of short-term compensation ~~received by~~ payable to the Executive in with respect to the fiscal year ended immediately prior to the Date of Termination and (ii) the average of the amounts of short-term compensation payable to the Executive with respect to each of the three most recently completed fiscal years ended immediately prior to the Date of Termination, and the value of long-term incentive compensation shall be the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided under Section 5.3 shall consist of continued accrual of benefits for the remainder of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof. Notwithstanding the foregoing, to the extent the Company determines for any reason not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, benefits provided under this Section 7.2 shall not be provided to the Executive to the extent such benefits would be duplicative of benefits provided elsewhere in this Agreement. 7.3. If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay (i) the Executive's normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become ~~due~~ due, and (ii) the ~~Supplemental~~ Special Retirement ~~Benefit, if any, shall continue~~ Benefit as and to the extent provided for in Section ~~5.2(b) hereof~~5.8. Such normal post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance with, Parent's or the ~~Company or its subsidiaries'~~ Company's retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this ~~Agreement except as set forth in Section 5.2(a) hereof~~Agreement), as applicable. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by Parent, the Company or ~~its~~ their affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the ~~Code~~ Code, or 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 "Excise Tax"), then the Executive shall be entitled to receive an additional payment ("Gross-Up Payment") in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the ~~Gross-~~Gross- Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by ~~the Company's~~ Parent s principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by ~~the Company~~ Parent or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting ~~Firm's~~ Firm s determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon Parent, the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that ~~the Company~~ Parent exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify ~~the Company~~ Parent in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise ~~the Company~~ Parent of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he gives such notice to ~~the Company~~ Parent (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If ~~the Company~~ Parent notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: (i) give ~~the Company~~ Parent any information reasonably requested by ~~the Company~~ Parent relating to such claim; (ii) take such action in connection with contesting such claim as ~~the Company~~ Parent shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by ~~the Company~~Parent; (iii) cooperate with ~~the Company~~ Parent in good faith in order to effectively contest such claim; and (iv) permit ~~the Company~~ Parent to participate in any proceeding relating to such claim; ~~provided~~PROVIDED, ~~however~~HOWEVER, that ~~the Company~~ Parent shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), ~~the Company~~ Parent shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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~~ Parent shall determine; ~~provided~~PROVIDED, ~~however~~HOWEVER, that if ~~the Company~~ Parent directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and ~~provided~~PROVIDED, ~~further~~ FURTHER that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, ~~the Company's~~ Parent s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to Parent's and the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and ~~the Company~~ Parent does not notify the Executive 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. 7.5. The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; ~~provided~~PROVIDED, ~~however~~HOWEVER, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). 7.6. The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any ~~such~~ termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); ~~provided~~PROVIDED, ~~however~~HOWEVER, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by ~~the Company~~ Parent pursuant to Section 7.4(c) hereof in connection with which ~~the Company~~ Parent complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as ~~the Company~~ Parent reasonably may require.

Appears in 1 contract

Samples: Merger Agreement (CTG Resources Inc)

Termination Compensation and Benefits. 7.1. If the Executive's ’s employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's ’s Base Salary (to the Executive or in accordance with Section 11.2 if the Executive's ’s employment is terminated by ~~his~~ her death) through the Date of Termination at the rate in effect at the time the Notice of Termination is given, together with all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination under the terms of any compensation or benefit plan, program or arrangement maintained by Energy East or the Company during such period. 7.2. In the event the Executive's ’s employment is terminated prior to the expiration of the Term of the Agreement by the Executive for Good Reason or by Energy East or the Company for reasons other than Cause (other than the death or Disability of the Executive), the Executive shall receive (i) continuation of ~~his~~ her Base Salary and the benefits provided for in Sections 5.2 and 5.3 of this Agreement for the remainder of the ~~Term~~Term , (ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount equal to the actual fee for such service up to a total of $10,000 and (iii) a lump sum payment equal to (A) the value of the fringe benefits that would have been provided to the Executive through the remainder of the Term in accordance with the Company's ’s policies as of the date one year prior to the Date of Termination and (B) any unreimbursed expenses payable pursuant to Section 5.5 of this Agreement. For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the amount of short-term compensation received by the Executive in the fiscal year ended immediately prior to the Date of Termination and the value of long-term incentive compensation shall be the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided under Section 5.3 shall consist of continued accrual of benefits for the remainder of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment~~; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~. Notwithstanding the foregoing, to the extent the Company and/or Energy East determines ~~for any reason~~ not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, benefits provided under this Section 7.2 shall not be provided to the Executive to the extent such benefits would be duplicative of benefits provided elsewhere in this Agreement. 7.3. If the Executive's ’s employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's ’s normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become ~~due and the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~due. Such post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance with, Energy East’s or the ~~Company or its subsidiaries'~~ Company’s retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this ~~Agreement except as set forth in Section 5.2(a) hereof~~Agreement), as applicable. 7.4. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by Energy East, the Company or ~~its~~ their affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "“Payment"”), would be subject to the excise tax imposed by Section 4999 of the Code or 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 "“Excise Tax"”), then the Executive shall be entitled to receive an additional payment ("“Gross-Up Payment"”) in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by the Company's principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by the Company or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he 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 notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: (i) give the Company any 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, without limitation, 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 Company to participate in any proceeding relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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; provided, however, that if the Company directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and provided, further that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive 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. 7.5. The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; provided, however, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). 7.6. The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any such termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); provided, however, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by the Company pursuant to Section 7.4(c) hereof in connection with which the Company complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require.

Appears in 1 contract

Samples: Employment Agreement (Avangrid, Inc.)

Termination Compensation and Benefits. ~~7.1.~~ 7.1 If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's Base Salary (to the Executive or in accordance with Section 11.2 if the Executive's employment is terminated by his death) through the Date of Termination at the rate in effect at the time the Notice of Termination is given, together with all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination under the terms of any compensation or benefit plan, program or arrangement maintained by Energy East or the Company during such period. ~~7.2.~~ 7.2 In the event the Executive's employment is terminated prior to the expiration of the Term of the Agreement by the Executive for Good Reason or by Energy East or the Company for reasons other than Cause (other than the death or Disability of the Executive), the Executive shall receive (i) continuation of his Base Salary and the benefits provided for in Sections 5.2 and 5.3 of this Agreement for the remainder of the Term, (ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount equal to the actual fee for such service up to a total of $10,000 and (iii) a lump sum payment equal to (A) the value of the fringe benefits that would have been provided to the Executive through the remainder of the Term in accordance with the Company's policies as of the date one year prior to the Date of Termination and (B) any unreimbursed expenses payable pursuant to Section 5.5 of this Agreement. For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the amount of short-term compensation received by the Executive in the fiscal year ended immediately prior to the Date of Termination and the value of long-term incentive compensation shall be the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided under Section 5.3 shall consist of continued accrual of benefits for the remainder of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment~~; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~. Notwithstanding the foregoing, to the extent the Company and/or Energy East determines ~~for any reason~~ not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, benefits provided under this Section 7.2 shall not be provided to the Executive to the extent such benefits would be duplicative of benefits provided elsewhere in this Agreement. ~~7.3.~~ 7.3 If the Executive's employment shall be terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become ~~due and the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~due. Such post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance with, Energy East's or the ~~Company or its subsidiaries'~~ Company's retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this ~~Agreement except as set forth in Section 5.2(a) hereof~~Agreement), as applicable. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by Energy East, the Company or ~~its~~ their affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the Code or 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 "Excise Tax"), then the Executive shall be entitled to receive an additional payment ("Gross-Up Payment") in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by ~~the Company~~Energy East's principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by ~~the Company~~ Energy East or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon Energy East, the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that ~~the Company~~ Energy East exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify ~~the Company~~ Energy East in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise ~~the Company~~ Energy East of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he gives such notice to ~~the Company~~ Energy East (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If ~~the Company~~ Energy East notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: (i) give ~~the Company~~ Energy East any information reasonably requested by ~~the Company~~ Energy East relating to such claim; (ii) take such action in connection with contesting such claim as ~~the Company~~ Energy East shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by ~~the Company~~Energy East; (iii) cooperate with ~~the Company~~ Energy East in good faith in order to effectively contest such claim; and (iv) permit ~~the Company~~ Energy East to participate in any proceeding relating to such claim; provided, however, that ~~the Company~~ Energy East shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), ~~the Company~~ Energy East shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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~~ Energy East shall determine; provided, however, that if ~~the Company~~ Energy East directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and provided, further that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, ~~the Company~~Energy East's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to Energy East's and the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and ~~the Company~~ Energy East does not notify the Executive 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. ~~7.5.~~ 7.5 The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; provided, however, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). ~~7.6.~~ 7.6 The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any such termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); provided, however, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by ~~the Company~~ Energy East pursuant to Section 7.4(c) hereof in connection with which ~~the Company~~ Energy East complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as ~~the Company~~ Energy East reasonably may require.

Appears in 1 contract

Samples: Employment Agreement (Rochester Gas & Electric Corp)

Termination Compensation and Benefits. ~~7.1.~~ 7.1 If the Executive's ’s employment ~~shall be~~ is terminated for any reason during the Term of this Agreement, the Company shall pay ~~the Executive's Base Salary (~~to the Executive (or in accordance with Section 11.2 if in the event of the Executive~~'s employment is terminated by his~~ ’s death), (i) the Executive’s Base Salary through the Date of Termination at the rate in effect at immediately prior to the time the Notice of Termination is given, ~~together with~~ (ii) all compensation and benefits (other than severance compensation and benefits) payable to the Executive through the Date of Termination or thereafter under the terms of any compensation or benefit plan, program or arrangement maintained by the Company during such period, including any short-term or long-term incentive compensation to which the Executive is entitled, by virtue of previous awards, in accordance with the terms of the plans in which Executive participates, and (iii) any unreimbursed expenses payable pursuant to Section 5.7 of the Agreement that were incurred before the Date of Termination. ~~7.2.~~ 7.2 In the event the Executive's ’s employment is terminated ~~prior to the expiration of the Term of the Agreement~~ by the Executive for Good Reason or by the Company for ~~reasons~~ any reason other than ~~Cause (other than the~~ Cause, death ~~or Disability~~ of the ~~Executive)~~Executive or Disability, the ~~Executive~~ Company shall ~~receive~~ (i) ~~continuation~~ pay the Executive, in addition to amounts payable under Section 7.1 and 7.4, a lump sum cash payment to be made within thirty (30) days after the Date of his Base Salary and the benefits provided for in Sections 5.2 and 5.3 of this Agreement for the remainder of the Term, (ii) payment of a fee to an independent outplacement firm selected by the Executive for outplacement services in an amount Termination equal to the ~~actual fee for such service up to a total~~ product of ~~$10,000 and (iii) a lump sum payment equal to~~ (A) the ~~value~~ sum of (w) the higher of the ~~fringe benefits that would have been provided~~ Base Salary in effect immediately prior to the ~~Executive through the remainder~~ occurrence of the ~~Term~~ event or circumstance upon which the Notice of Termination is based or the Base Salary in ~~accordance with~~ effect immediately prior to the ~~Company's policies as~~ date of the ~~date one~~ Notice of Termination plus (x) the higher of the annual cash incentive award that may be earned by the Executive if target performance levels are achieved in the year ~~prior to~~ in which the Date of Termination ~~and~~ occurs or the highest annual incentive award that was actually paid by the Company to the Executive for any year in the three preceding years, times (B) ~~any unreimbursed expenses payable pursuant~~ the greater of (y) one or (z) a fraction the numerator of which is the number of months (rounded up to ~~Section 5.5~~ the nearest whole month) remaining in the Term of this Agreement. For purposes of determining equivalent value of incentive compensation, the value of short-term incentive compensation shall be the amount of short-term compensation received by the Executive in the fiscal year ended immediately prior to Agreement from the Date of Termination and the ~~value~~ denominator of ~~long-term incentive compensation shall be~~ which is 12; and (ii) continue the value of long-term incentive compensation awards outstanding on the Date of Termination for performance periods ending after the Date of Termination, such value being determined based upon the projected target value of the applicable long-term incentive compensation award as determined by the Company in connection with the grant thereof. Continuation of the pension benefits provided ~~under~~ for in Section ~~5.3 shall consist~~ 5.2 of ~~continued accrual of benefits~~ this Agreement for the ~~remainder~~ remaining Term of the Term under any employee pension benefit plans (as that term is defined in Section 3(2) of ERISA), and any plan, program or arrangement providing supplemental retirement income payments, in which the Executive was participating at the time of termination of employment; provided that, the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof. Notwithstanding the foregoing, to the extent the Company determines for any reason not to continue the retirement and welfare benefits provided under Sections 5.2 and 5.3, respectively, pursuant to the respective plan, program or arrangement, the Executive shall receive equivalent benefits outside such plan, program or arrangement at no additional cost (including, without limitation, tax costs) to the Executive. Notwithstanding any other provision in this Agreement, ~~benefits~~ provided ~~under this Section 7.2 shall not be provided to the Executive to the extent~~ that such benefits ~~would~~ shall be ~~duplicative~~ discontinued if comparable benefits are obtained from a subsequent employer during the remaining Term of ~~benefits provided elsewhere in~~ this Agreement. ~~7.3.~~ 7.3 In the event that the Executive’s employment is terminated by the Executive for any reason other than death, Disability or Good Reason or is terminated by the Company for Cause, the Company shall pay the Executive any amounts due pursuant to Section 7.1 and 7.4 hereof. 7.4 If the Executive's ’s employment ~~shall be~~ is terminated for any reason during the Term of this Agreement, the Company shall pay the Executive's ’s normal post-termination compensation and benefits (other than severance compensation and benefits) to the Executive as such payments become ~~due and the Supplemental Retirement Benefit, if any, shall continue as provided in Section 5.2(b) hereof~~due. Such normal post-termination compensation and benefits (other than severance compensation and benefits) shall be determined under, and paid in accordance ~~with,~~ with the ~~Company or its subsidiaries'~~ Company’s retirement, insurance and other compensation or benefit plans, programs and arrangements (other than this ~~Agreement except as set forth in Section 5.2(a) hereof~~Agreement), as applicable. 7.5 (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, benefit, or distribution by the Company or its affiliates to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "“Payment"”), would be subject to the excise tax imposed by Section 4999 of the ~~Code~~ Code, or 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 "“Excise Tax"”), then the Executive shall be entitled to receive an additional payment ("“Gross-Up Payment"”) in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Section 7.4(c) hereof, all determinations required to be made under this Section 7.4, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be used in arriving at such determinations, shall be made by the Company's principal outside accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Board and the Executive within fifteen (15) business days of the Date of Termination and/or such earlier date(s) as may be requested by the Company or the Executive (each such date and the Date of Termination shall be referred to as a "Determination Date" for purposes of this Section 7.4(b) and Section 7.5 hereof). All fees and expenses of the Accounting Firm shall be borne solely by the Company. The initial Gross-Up Payment, if any, as determined pursuant to this Section 7.4(b), shall be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm under this Section 7.4(b) shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment") consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 7.4(c) and the Executive thereafter is required to make a payment of any 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 the benefit of the Executive. (c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of an Underpayment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which he 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 notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: (i) give the Company any 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, without limitation, 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 Company to participate in any proceeding relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including 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 Section 7.4(c), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo 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 the Executive to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the Executive 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; provided, however, that if the Company directs the Executive to pay such claim and xxx for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive 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 advance or with respect to any imputed income with respect to such advance; and provided, further that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive 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. (d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, the Executive becomes entitled to receive any refund with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Section 7.4(c) hereof) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 7.4(c) hereof, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive 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. 7.5. The payments provided for in Section 7.4 hereof (other than Section 7.4(c) and (d)) shall be made not later than the fifth (5th) day following each Determination Date; provided, however, that if the amounts of such payments 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 Executive, of the minimum amount of such payments to which the Executive is clearly entitled 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 but in no event later than the thirtieth (30th) day after each Determination Date. 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 Executive, payable on the fifth (5th) business day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). 7.6. The Company also shall pay to the Executive all reasonable legal fees and expenses incurred by the Executive as a result of a termination which entitles the Executive to the Severance Payments (including all such fees and expenses, if any, incurred in disputing any such termination or in seeking in good faith to obtain or enforce any benefit or right provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder); provided, however, the Company shall not be required to pay to the Executive legal fees and expenses to the extent such legal fees and expenses were incurred in connection with a contest controlled by the Company pursuant to Section 7.4(c) hereof in connection with which the Company complied with its obligations under said Section 7.4(d). Such payments shall be made within five (5) business days after delivery of the Executive's written request for payment accompanied with such evidence of fees and expenses incurred as the Company reasonably may require.

Appears in 1 contract

Samples: Employment Agreement (Armstrong World Industries Inc)

Common use of Termination Compensation and Benefits Clause in Contracts