Impermissible Deferral

[ERISA25]

The arrangement is an exempt separation pay plan where the individual can leave with good reason within 1 year following change in control. The CIC has occurred and good reason exists, but new company would like for individual to stay on. Are there any issues with creating a new arrangement under which individual will be paid the same amount under a 409A-compliant separation from service plan?

The arrangement is exempt so not subject to the substitution rules, but I am concerned that the new arrangement may be viewed as an impermissible deferral election for the separation pay payment under the old arrangement.

What about allowing the existing arrangement to continue and then lapse with the new arrangemetn kicking-im immediately thereafter?

Thoughts?