Saks Fifth Avenue 2008 Annual Report Download - page 210

9. Termination by the Company for Cause. The Company may at any time terminate the Executive’s employment hereunder for
Cause, effective upon notice given to the Executive. Upon such termination, all of the rights of the Executive hereunder shall cease,
except as described in Sections 4(a)(i)(A) and (C) hereof and in clauses (b) and (c) of Section 8 hereof, as applied to a termination for
Cause. Such termination shall terminate the Company’s obligations hereunder, but shall not terminate the Executive’s obligations
under Sections 12 or 13(h) of this Agreement.
10. Application of IRC Code Section 409A. Notwithstanding any other provision of this Agreement, if on the Employment
Termination Date (a) the Company is a publicly traded corporation and (b) the Company determines that the Executive is a “specified
employee,” as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), then to the extent any
amount payable under this Agreement (i) is payable as a result of the separation of the Executive’s service, (ii) constitutes the
payment of nonqualified deferred compensation within the meaning of Section 409A of the Code and (iii) under the terms of this
Agreement would be payable prior to the six-month anniversary of the Employment Termination Date, such payment shall be delayed
until the six-month anniversary of the Employment Termination Date. This Agreement shall be interpreted and construed in a manner
that avoids the imposition of excise taxes and other penalties under Section 409A of the Code (“409A Penalties”). In the event the
terms of this Agreement would subject the Executive to 409A Penalties, the Company and the Executive shall cooperate diligently to
amend the terms of this Agreement to avoid such 409A Penalties, to the extent possible. Notwithstanding the foregoing, under no
circumstance shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Executive
due to any failure to comply with Section 409A of the Code, except that the Company shall be responsible for such taxes, penalties,
interest, losses or expenses that result from a payment by the Company to the Executive in contravention of the Executive’s written
instructions to the Company, which payment constitutes an act of negligence by the Company. The Company shall pay the Executive
interest on any severance payment delayed in order to comply with Section 409A of the Code in accordance with the Company’s
policy for other senior executives of the Company.
11. Gross-Up Payment.
(a) Amount of Gross-Up Payment. Anything in this Agreement to the contrary notwithstanding, if any payment or
distribution by the Company or its affiliated companies to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional
payments required under this Section 11) (a “Payment”) becomes or would become subject to the excise tax imposed by
Section 4999 of the Code, or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise
tax, together with any such interest and penalties, are together referred to as the “Excise Tax”), then, subject to the next
sentences of this Section 11(a), the Company will make an additional payment to the Executive (a “Gross-Up Payment”) in an
amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such
taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments. The Executive will be entitled to a Gross-Up Payment in accordance with this Section 11(a) only if
the Executive’s “parachute payments” (as such term is defined in Section 280G of the Code) exceed three hundred thirty percent
(330%) of the Executive’s “base amount” (as determined under Section 280G(b) of the
9