Change in Control Definitions

[Guest RWMalone]

I understand the definition of Change in Control in 409A. And I understand the various Change in Control events described in 409A. Applying a definition within a plan document that is less restrictive would certainly be contrary to 409A. However, can the plan document establish a Change in Control definition that is more restrictive? For example, could a Change in Control definition be established that provides for the 409A definition PLUS a change in management? Would such a definition comply with 409A and allow for a distribution only at the time that both criteria are met?

[Steelerfan]

You can use any definition of CIC you want as a trigger to a right to payment, but only the 409A definition if you want to use it as a payment event.

But this only makes sense to me if the definition you use is more lenient. If it's more restrictive, wouldn't the 409A definition essentially be met?

[jpod]

Steelerfan: Is there something in the regs. that says you have an impermissible payment event if you have a double trigger (i.e., a 409A CC coupled with some other condition being satisfied, such as that mentioned by RWMalone)?

[Steelerfan]

I think you would have a problem if the second trigger isn't a 409A permissible event, and you're beyond the time for payment under the first trigger. To do something like that, I'd try to structure the second trigger as lifting an SRF and fit w/in the short term deferral exception.