280G definition

280G. If any Person who is a “disqualified individual” (within the meaning of Section 280G of the Code and the Department of Treasury regulations promulgated thereunder) with respect to the Company would reasonably be expected to receive any payment(s) or benefit(s) that could constitute parachute payments under Section 280G of the Code in connection with the Transactions as determined without taking into account any Contracts or arrangements (including any equity or equity-based Contracts or arrangements) entered into between Parent or one of its Affiliates and an employee or other service provider of the Company unless any such Contracts or arrangements were disclosed to the Company at least five (5) Business Days prior to the Closing Date, then: (a) the Company will use commercially reasonable efforts to obtain and deliver to Parent each of the waivers received from such “disqualified individual(s)” regarding the parachute payments (the “Parachute Payment Waivers”) as soon as practicable after the date hereof (but in no event later than the day immediately prior to the Closing Date); and (b) as soon as practicable following the delivery of the Parachute Payment Waivers (if any) to Parent (but in any event prior to the Closing), the Company will prepare and distribute to its shareholders a disclosure statement describing the potential parachute payments and benefits that may be received by such disqualified individual(s) and will submit such statements to its shareholders for approval, in each case, in accordance with the requirements of Section 280G(b)(5)(B) of the Code and the Department of Treasury regulations promulgated thereunder, such that, if approved by the shareholders, such payments and benefits will not be deemed to be “parachute payments” under Section 280G of the Code (the foregoing actions, a “Section 280G Vote”). Prior to the Closing, if a Section 280G Vote is required, the Company will deliver to Parent evidence (i) that the requisite shareholder approval was obtained with respect to any payments and/or benefits that were subject to the shareholder vote (the “Section 280G Approval”) or (ii) that the Section 280G Approval was not obtained and as a consequence, pursuant to the Parachute Payment Waiver, such “parachute payments” will not be made or provided. Notwithstanding the foregoing provisions of this Section 4.16, the Company will have no obligation to compel any Person to execute a Parachute Payment Waiver and in no event will the Company ...

Examples of 280G in a sentence

• The present value of payments to or for the benefit of Executive in the nature of compensation, receipt of which is contingent on a Change in Control, and to which Code Section 280G applies (in the aggregate “Total Payments”) shall not exceed an amount equal to one dollar ($1.00) less than the maximum amount that the Company may pay without loss of deduction under Code Section 280G(a).

• Neither the execution and delivery of this Agreement nor the consummation of the Transaction (either alone or in combination with another event) result in any payment that could individually or in combination with any other such payment constitute an “excess parachute payment” to a “disqualified individual” as those terms are defined in Section 280G of the Code, without regard to whether such payment is reasonable compensation for personal services performed or to be performed in the future.

• If the amount calculated under (a) is less than (b), then the payments pursuant to this Agreement and any other arrangement or agreement pursuant to which 280G Payments are made to Employee will be reduced to the extent necessary to avoid the imposition of the excise tax to any portion of the 280G Payments.

• With respect to any payments and/or benefits that may constitute “parachute payments” under Section 280G of the Code with respect to any Company Employee, the Company will submit such parachute payments to the Company Shareholders for approval, with the understanding that the solicitation materials for such approval will not be included as part of the Information Statement but instead be distributed as a separate solicitation package to the Company Shareholders.

• If the National Tax Counsel so requests in connection with the opinion required by this Section 9(b), the Executive and the Company shall obtain, at the Company’s expense, and the National Tax Counsel may rely on, the advice of a firm of recognized executive compensation consultants as to the reasonableness of any item of compensation to be received by the Executive solely with respect to its status under Section 280G of the Code and the regulations thereunder.

• For purposes of this Section 27.4, “Net Benefit” shall mean the present value (using appropriate discount rates pursuant to Section 280G of the Code) of the 280G Payments net of all federal, state, local, or foreign income, employment and excise taxes.

• Except as set forth on Schedule 3.14(j) of the Company Disclosure Schedule, the Company has made available to Buyer true, correct and complete copies of Section 280G calculations prepared (whether or not final) with respect to any disqualified individual in connection with the transactions contemplated hereby.