Common use of Payments Upon Change of Control Clause in Contracts

Payments Upon Change of Control. (a) Within 30 days following a Change of Control, a cash payment shall be made to the Executive in an amount equal to 299% of the "base amount" as that term is defined in Code Section 280G. The determination of the base amount shall be made by the Company's independent auditors. For this purpose, the "base amount" shall be calculated with respect to the 3 taxable year period ending before the date on which the Change of Control as defined herein occurs, regardless of whether such Change of Control is an event described in Code Section 280G (b)(2)(A). (b) If the Company reasonably anticipates that payment under paragraph (a) above would result in disallowance of any portion of the Company's deduction therefor under Section 162(m) of the Code, the payment called for under paragraph (a) shall be limited to the amount which is deductible, with the balance to be paid as soon as deductible by the Company; provided, however that such payment shall be made on the earliest date on which the Company reasonably anticipates or should reasonably anticipate that the deduction for the payment of the amount will not be barred by application of Code Section 162(m). Any amounts which are so deferred shall earn interest until paid at an annual rate equal to the prime rate. For interest accruing during any calendar year the "prime rate" shall be the rate reported as the prime rate in the Wall Street Journal on the first business day of that year.