Common use of Effect of Section 409A of the Code Clause in Contracts

Effect of Section 409A of the Code. Notwithstanding anything to the contrary in this Agreement, if, upon the advice of its counsel, the Company determines that any payments or benefits to be provided to Executive pursuant to this Section 6 are or may become subject to the additional tax under Section 409A(a)(1)(B) of the Code or any other taxes or penalties imposed under Section 409A of the Code (“409A Taxes”) as applicable at the time such payments and benefits are otherwise required under this Agreement, then such payments or benefits shall be delayed until the date that is six months after the date of Executive’s “separation from service” (as such term is defined under Section 409A of the Code) with the Company, or such shorter period that, in the opinion of such counsel, is sufficient to avoid the imposition of 409A Taxes (the “Payments Delay Period”). The Company and Executive agree to cooperate in good faith so that Executive will not be taxed under Section 409A of the Code.

Appears in 2 contracts

Sources: Executive Employment Agreement (Red Hat Inc), Executive Employment Agreement (Red Hat Inc)