OF THE CODE; PROVIDED, HOWEVER, THAT SUCH DEFERRAL SHALL ONLY BE
EFFECTED TO THE EXTENT REQUIRED TO AVOID ADVERSE TAX TREATMENT TO EXECUTIVE
UNDER SECTION 409A, INCLUDING (WITHOUT LIMITATION) THE ADDITIONAL 20% TAX FOR
WHICH EXECUTIVE WOULD OTHERWISE BE LIABLE UNDER SECTION 409A(A)(1)(B)
OR ANY
STATE LAW EQUIVALENT OF SECTION 409A IN THE ABSENCE OF SUCH DEFERRAL.
DURING
ANY PERIOD IN WHICH AN AGREEMENT PAYMENT TO EXECUTIVE IS DEFERRED PURSUANT TO
THE FOREGOING, EXECUTIVE SHALL BE ENTITLED TO INTEREST ON THE DEFERRED AGREEMENT
PAYMENT AT A PER ANNUM RATE EQUAL TO THE HIGHEST RATE OF INTEREST APPLICABLE TO
SIX-MONTH NON-CALLABLE CERTIFICATES OF DEPOSIT WITH DAILY COMPOUNDING OFFERED BY
CITIBANK N.A., WELLS FARGO BANK,
10
N.A. OR BANK OF AMERICA ON THE DATE OF SUCH SEPARATION FROM SERVICE.
UPON THE
EXPIRATION OF THE APPLICABLE DELAY PERIOD, ANY AGREEMENT PAYMENT THAT WOULD HAVE
OTHERWISE BEEN MADE DURING THAT PERIOD (WHETHER IN A SINGLE SUM OR IN
INSTALLMENTS) IN THE ABSENCE OF THIS SECTION 5.6 SHALL BE PAID TO EXECUTIVE OR
EXECUTIVE'S BENEFICIARY IN ONE LUMP SUM, INCLUDING ALL ACCRUED INTEREST, AND ALL
REMAINING AGREEMENT PAYMENTS, IF ANY, WILL BE PAYABLE IN ACCORDANCE WITH THE
PAYMENT SCHEDULE APPLICABLE TO EACH PAYMENT OR BENEFIT.
EACH PAYMENT AND BENEFIT PAYABLE UNDER THE AGREEMENT IS INTENDED TO CONSTITUTE A
SEPARATE PAYMENT FOR PURPOSES OF SECTION 1.409A-2(B)(2) OF THE TREASURY
REGULATIONS. THE FOREGOING PROVISIONS ARE INTENDED TO COMPLY WITH THE
REQUIREMENTS OF SECTION 409A SO THAT NONE OF THE SEVERANCE PAYMENTS AND BENEFITS
TO BE PROVIDED HEREUNDER WILL BE SUBJECT TO THE ADDITIONAL TAX IMPOSED UNDER
SECTION 409A, AND ANY AMBIGUITIES HEREIN WILL BE INTERPRETED TO SO COMPLY.
THE
COMPANY AND EXECUTIVE AGREE TO WORK TOGETHER IN GOOD FAITH TO CONSIDER
AMENDMENTS TO THIS AGREEMENT AND TO TAKE SUCH REASONABLE ACTIONS WHICH ARE
NECESSARY, APPROPRIATE OR DESIRABLE TO AVOID IMPOSITION OF ANY ADDITIONAL TAX OR
INCOME RECOGNITION PRIOR TO ACTUAL PAYMENT TO EXECUTIVE UNDER SECTION 409A.
5.7
GOLDEN PARACHUTE PAYMENTS.
(A)
IN THE EVENT THAT ANY PAYMENT RECEIVED OR TO BE RECEIVED BY
EXECUTIVE PURSUANT TO THIS AGREEMENT OR OTHERWISE ("PAYMENT") WOULD BE SUBJECT
TO THE EXCISE TAX IMPOSED BY SECTION 4999 OF THE CODE, OR ANY COMPARABLE
FEDERAL, STATE, LOCAL OR FOREIGN EXCISE TAX (SUCH EXCISE TAX, TOGETHER WITH ANY
INTEREST AND PENALTIES, IS HEREINAFTER COLLECTIVELY REFERRED TO AS THE "EXCISE
TAX"), THEN EXECUTIVE SHALL BE ENTITLED TO RECEIVE AN ADDITIONAL PAYMENT FROM
THE COMPANY ("GROSS-UP PAYMENT") IN SUCH AN AMOUNT THAT AFTER THE PAYMENT OF ALL
TAXES (INCLUDING, WITHOUT LIMITATION, ANY INTEREST AND PENALTIES ON SUCH TAXES
AND THE EXCISE TAX) ON THE PAYMENT AND ON THE GROSS-UP PAYMENT, EXECUTIVE SHALL
RETAIN AN AMOUNT EQUAL TO (A) THE PAYMENT MINUS (B) ALL APPLICABLE TAXES ON THE
PAYMENT OTHER THAN THE EXCISE TAX.
THE INTENT OF THE PARTIES IS THAT THE
COMPANY SHALL BE SOLELY RESPONSIBLE FOR, AND SHALL PAY, ANY EXCISE TAX ON THE
PAYMENT AND GROSS-UP PAYMENT AND ANY INCOME, EMPLOYMENT AND OTHER TAXES
(INCLUDING, WITHOUT LIMITATION, PENALTIES AND INTEREST) IMPOSED ON THE