Common use of Certain Additional Payments by the Employer Clause in Contracts

Certain Additional Payments by the Employer. a. Anything in this Agreement to the contrary notwithstanding, if it shall be determined that any payment, benefit or distribution to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement (including without limitation pursuant to Section 4 above), pursuant to the Company’s or its affiliates’ benefit plans or programs, pursuant to the benefit plans of Employer or its affiliates, pursuant to or as a result of the Merger Agreement or the Merger, or otherwise (a “Payment”) would, either alone or when taken together with any other payments, benefits or distributions to or for the benefit of Executive, be (i) subject to the excise tax imposed by Section 4999 of the Code (“4999 Excise Tax”), then in such instance Executive shall be entitled to receive from Employer an additional payment (a “Gross-Up Payment”) in an amount such that after payment by Executive of all taxes, including, 4999 Excise Tax imposed upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment equal to the aggregate amount of the 4999 Excise Tax imposed upon the Payment. To compute the Gross-Up Payment, the highest applicable federal marginal income tax rate and the highest applicable state marginal income tax rate (after reduction for the federal income tax benefit received from the state income tax rate) shall be used. b. Executive shall notify Employer in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by Employer of a Gross-Up Payment. Such notification shall be given as soon as practicable but no later than fifteen (15) business days after Executive is informed in writing of such claim and shall apprise Employer of the nature of such claim and the date on which such claim is requested to be paid. Executive shall not pay such claim prior to the expiration of the thirty (30) day period following the date on which it gives such notice to Employer (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If Employer notifies Executive in writing prior to the expiration of such 30-day period that it desires to contest such claim, Executive shall, at Employer’s sole cost and expense: (i) give Employer any information reasonably requested by Employer relating to such claim, (ii) take such action in connection with contesting such claim as Employer 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 Employer, (iii) cooperate with Employer in good faith effectively to contest such claim, and (iv) permit Employer to participate in any proceedings relating to such claim; provided, however, that Employer shall bear and pay directly all costs and expenses (including attorneys’ fees and additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any 4999 Excise Tax, (including interest and penalties with respect thereto) imposed as a result of such representation and for payment of any and all costs and expenses. Employer’s involvement in any contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder, and 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.