Limitations on Payments Related to Change in Control Clause Samples
The "Limitations on Payments Related to Change in Control" clause restricts the amount or type of compensation or benefits that can be paid to employees or executives if the company undergoes a change in control, such as a merger or acquisition. Typically, this clause sets caps on severance payments, bonuses, or accelerated vesting of equity awards to prevent excessive payouts that could be triggered by such corporate events. Its core practical function is to protect the company from incurring significant financial liabilities and to ensure compliance with tax regulations or shareholder interests during major organizational changes.
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(1) the total of the payments and benefits described in Section 9(d)(3) will be less than the amount that would cause them to be a “parachute payment” within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code;
(2) the payment and benefits described in Section 9(d)(3) will be reduced by any compensation (in the form of cash or other benefits) received by Executive from the Company or its successor after the Change in Control and/or after Executive’s termination of employment; and
(3) Executive’s right to receive the payments and benefits described in Section 9(d)(3) terminates (i) immediately if before the Change in Control transaction closes, Executive terminates his employment without Good Reason, or the Company terminates Executive’s employment for Cause, or (ii) two years after a Change of Control occurs.
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this agreement:
a. The payment described in Section 5(f)(ii) shall be less than the amount that would cause it to be a "parachute payment" within the meaning of Section 280G (b)(2)(A) of the Internal Revenue Code; and
b. The executive's right to receive the payment described in Section 5(f)(ii) terminates (a) immediately if before the Change in Control transaction closes, the Executive terminates his employment without good reason or the Company terminates the Executive's employment for cause, or (b) two years after a Change in Control occurs.
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(1) the total of the payments described in Section 10(d)(3) will be less than the amount that would cause them to be a “parachute payment” within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code;
(2) the payment described in Section 10(d)(3) will be reduced by any compensation (in the form of cash or other benefits) received by Executive from the Company or its successor after the Change in Control and/or after Executive’s termination of employment; and
(3) Executive’s right to receive the payments described in Section 10(d)(3) terminates (i) immediately if before the Change in Control transaction closes, Executive terminates his employment without Good Reason, or the Company terminates Executive’s employment for Cause, or (ii) two years after a Change of Control occurs.
(4) Notwithstanding anything to the contrary in this or any other agreement or plan, including Section 10(e)(1) of this Agreement, to the extent that any payment or distribution of any type to or for the benefit of the Executive by the Company (or by any affiliate of the Company, any person or entity who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets (within the meaning of Section 280G of the Internal Revenue Code, and the regulations thereunder), or any affiliate of such person or entity, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (the “Total Payments”), is or will be subject to the excise tax imposed under Section 4999 of the Internal Revenue Code (the “Excise Tax”), then the Total Payments shall be reduced (but not below zero) only if and to the extent that a reduction in the Total Payments would result in the Executive retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received the entire amount of such Total Payments. Unless the Executive shall have given prior written notice specifying a different order to the Company to effectuate the foregoing, the Company shall reduce or eliminate the Total Payments, by first reducing or eliminating the portion of the Total Payments which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from th...
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(1) If the total of the payments and benefits described in Section 10(b) will be an amount that would cause them to be a “parachute payment” within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code (a “Parachute Payment Amount”), then such payment(s) shall be reduced so that the total amount thereof is $1 less than the Parachute Payment Amount; and
(2) Executive’s right to receive the payments and benefits described in Section 10(b) terminates immediately if before the Change in Control transaction closes, Executive terminates his employment without Good Reason or the Bank or the Corporation terminates Executive’s employment for Cause.
Limitations on Payments Related to Change in Control. Notwithstanding the foregoing, the payment described in paragraph 5(f)(ii) shall be automatically reduced to an amount that is less than the amount that would cause it to be a "parachute payment" within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code.
Limitations on Payments Related to Change in Control. Notwithstanding any other provision of this Agreement:
(1) the Change in Control Payment will be less than the amount that would cause it to be a "parachute payment" within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code");
(2) the Change in Control Payment will be reduced by any salary that Executive receives from the Bank or its successor after the Change in Control; and
(3) Executive's right to receive the Change in Control Payment terminates (i) immediately, if before the Change in Control transaction closes, Executive terminates his employment without Good Reason or the Bank terminates Executive's employment for Cause, or (ii) one year after a Change in Control occurs.
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(i) Any payments that would otherwise be made pursuant to Section 10(d)(d)(iii) will be reduced by any base salary, cash bonus (including STIP pursuant to Section 6), or Severance Payments (as defined in Section 10(b)) received by Executive from the Company or its successor after the first to occur of a Change in Control or Executive's termination of employment.
(ii) Executive's right to receive the payments described in Section 10(d)(iii) terminates (A) immediately if before the Change in Control transaction closes, Executive terminates his employment without Good Reason, or the Company and the Bank terminate Executive's employment for Cause, or (B) two (2) years after a Change of Control occurs.
(iii) Notwithstanding anything to the contrary in this Agreement or any other agreement or plan, to the extent that any payment or distribution of any type to or for the benefit of Executive by the Company (or by any affiliate of the Company, any person or entity who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company's assets within the meaning of Section 280G of the Internal Revenue Code, and the regulations thereunder, or any affiliate of such person or entity), whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (the "Total Payments"), is or will be subject to the excise tax imposed under Section 4999 of the Internal Revenue Code (the "Excise Tax"), then the Total Payments shall be reduced (but not below zero) only if and to the extent that a reduction in the Total Payments would result in Executive retaining a larger amount, on an after-tax basis (taking into account federal, state, and local income taxes and the Excise Tax), than if Executive received the entire amount of such Total Payments. Unless Executive shall have given prior written notice specifying a different order to the Company to effectuate the foregoing, the Company shall reduce or eliminate the Total Payments by first reducing or eliminating the portion of the Total Payments that are cash payments, and then by reducing or eliminating the portion of the Total Payments that are not payable in cash, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as defined below); provided, however, that in all events, such reductions shall be ...
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(1) If the total of the payments and benefits described in Section 10.b will be an amount that would cause them to be a “parachute payment” within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code (a “Parachute Payment Amount”), then such payment(s) shall be reduced so that the total amount thereof is $1 less than the Parachute Payment Amount (provided that in the event of such a reduction, the Bank’s accountants shall determine which benefits shall be reduced, and in no event shall the foregoing be interpreted or administered so as to result in an acceleration of payment or further deferral of payment of any amounts in violation of Section 409A); and
(2) Executive’s right to receive the payments and benefits described in Section 10.b terminates immediately if before the Change in Control transaction closes, Executive terminates his employment without Good Reason or the Bank or the Corporation terminates Executive’s employment for Cause.
Limitations on Payments Related to Change in Control. Notwithstanding any other provision of this Agreement:
Limitations on Payments Related to Change in Control. The following apply notwithstanding any other provision of this Agreement:
(1) the total of the payments and benefits described in Section 9.(d)(3) will be less than the amount that would cause it to be a "parachute payment" within the meaning of Section 280G(b)(2)(A) of the Internal Revenue Code;
(2) the payments and benefits described in Section 9.(d)(3) will be reduced by any compensation (in the form of cash or other benefits) received by Symmes from the Bank or its successor after the Change in Control; and
(3) Symmes' right to receive the payments and benefits described in Section 9.(d)(3) terminates (i) immediately, if before the Change in Control transaction closes, Symmes terminates his employment without Good Reason or the Bank terminates Symmes' employment for Cause, or (ii) one year after a Change in Control occurs.