Change in Control as SROF

[Guest JMN]

The regs include an IPO as an example of a condition related to a purpose of the compensation, i.e., as relating to the employer's business activities or organizational goals. An IPO is a type of CIC, so can a CIC also constitute a SROF? Ignore fact that CIC is a valid payment event.

[jpod]

An IPO may not be a 409A CIC, but it doesn't matter. An IPO condition can create a SRF. So too can a CIC condition that is not a 409A CIC.

[Guest JMN]

An IPO may not be a 409A CIC, but it doesn't matter. An IPO condition can create a SRF. So too can a CIC condition that is not a 409A CIC.

Thanks. My situation involves a 409A-compliant CIC defintion, which I am trying to decide whether could be viewed as creating an SROF. That would give some flexibility regarding the amount of the payment (i.e., include a discretionary range - crazy, I know, but that's what is agreed to). The easiest solution would be to go with the minimum amount and then the employer could always decide to give more later.