Common use of Cash Incentive Compensation Clause in Contracts

Cash Incentive Compensation. Notwithstanding anything herein to the contrary, if the Transfer Date under the Secondment Agreement occurs other than on December 31 of any year during the Period of Secondment, with respect to all Seconded Employees, the Services Reimbursement shall include the amounts, if any, of all cash bonus and other cash incentive compensation payments that would be payable to the Seconded Employees through the Transfer Date under the terms and conditions of the applicable Benefit Plans (except that Chesapeake Management may, in its discretion, consider continued employment by Chesapeake Management through the Transfer Date as satisfying any requirement under any such Benefit Plan of continued employment through year end or date of payment) and such amounts shall be determined on a pro-rated basis for the year that includes the Transfer Date based on the number of days that the Seconded Employee was actually seconded to the General Partner hereunder during the year in which the Transfer Date occurred. Notwithstanding the foregoing, the provisions of this Section 4.3 shall not apply to MICP Payments, and 100% of the MICP Payments attributable to awards made to a Seconded Employee during his or her Period of Secondment (regardless of whether such award is actually paid during or after the termination of the Seconded Employee’s Period of Secondment) shall be included in the Services Reimbursement and the Seconded Employee Expenses to the extent that such MICP Payments are actually paid by a Chesapeake Entity and to the extent provided in Section 4.2; provided, however, that with respect to a Seconded Employee whose Secondment is terminated but who remains employed by a Chesapeake Entity following such termination of Secondment, the amount of the MICP Payments includable in the Services Reimbursement shall not exceed the amount of such MICP Payments that were actually paid and to the extent provided in Section 4.2 but multiplied by a fraction the numerator of which equals the number of days in such Seconded Employee’s Period of Secondment and the denominator of which equals the number of days in such Seconded Employee’s Period of Secondment plus the number of days of his or her post-Secondment employment with a Chesapeake Entity through the applicable payment date under the MICP.

Cash Incentive Compensation. Notwithstanding anything herein Following the Closing, Purchaser shall, or shall cause its applicable Subsidiaries to pay awards under Seller Parent cash-based annual incentive plan (the “Seller Cash Incentive Plan”) in which Transferred Employees participate for the performance period in which the Closing occurs, prorated for the period elapsed as of immediately prior to the contraryClosing Date, if the Transfer Date under the Secondment Agreement occurs other than on December 31 of any year during the Period of Secondment, or with respect to all Seconded Employeesany Delayed Transfer Employee, the Services Reimbursement shall include date on which such Delayed Transferred Employee transfers employment (based upon actual performance as determined in good faith in the amountsordinary course of business consistent with past practice by Seller Parent or its applicable Affiliate), if any, of all cash bonus and other cash incentive compensation payments that would be payable to each Transferred Employee who is eligible to receive such an award pursuant to the Seconded Employees through the Transfer Date under the terms and conditions of the applicable Benefit Plans (except that Chesapeake Management maySeller Cash Incentive Plan, in its discretion, consider continued employment by Chesapeake Management through the Transfer Date as satisfying any requirement under any such Benefit Plan of continued employment through year end or date of payment) and such amounts which awards shall be determined on a pro-rated basis for the year that includes the Transfer Date based on the number of days that the Seconded Employee was actually seconded to the General Partner hereunder during the year in which the Transfer Date occurred. Notwithstanding the foregoing, the provisions of this Section 4.3 shall not apply to MICP Payments, paid at such time and 100% of the MICP Payments attributable to awards made to a Seconded Employee during his or her Period of Secondment (regardless of whether such award is actually paid during or after the termination of the Seconded Employee’s Period of Secondment) shall be included in the Services Reimbursement and the Seconded Employee Expenses to the extent that the Transferred Employees would have otherwise become entitled to such MICP Payments are actually paid by a Chesapeake Entity and to bonuses under the extent provided in Section 4.2Seller Cash Incentive Plan (such prorated bonus, the “Seller Closing Bonus”); provided, however, that if Purchaser’s or its applicable Subsidiary’s payment of the Seller Closing Bonus is prohibited under applicable Law, Purchaser and Seller Parent will agree to an alternative arrangement with respect to a Seconded Employee whose Secondment is terminated any such Seller Closing Bonus acting in good faith (which alternative arrangement shall preserve the division of Liabilities between Seller Parent and its Affiliates, on the one hand, and Purchaser and its Affiliates, on the other hand, generally contemplated by this Section 6.6(c)(v)). The aggregate amount of the Seller Closing Bonuses and any related employer-side Taxes (but who remains employed by a Chesapeake Entity following such termination of Secondment, less the amount of the MICP Payments includable Tax deduction that Seller Parent or its Affiliates would have realized had they paid the Seller Closing Bonuses) shall be reflected as a Liability in Business Working Capital. Without limiting the generality of Section 6.6(c)(i), effective as of the Closing, Purchaser shall cause the Transferred Employees to participate in the Services Reimbursement cash-based incentive plans of Purchaser and its Affiliates for the remainder of the performance period in which the Closing occurs, which plans shall provide (A) incentive compensation opportunities that are no less favorable than those provided to such Transferred Employees immediately prior to the Closing (provided that such opportunities may be prorated for the period from and including the Closing Date until the end of the applicable performance period and may be based on reasonable performance criteria established by Purchaser in the ordinary course of business) and (B) for payment of awards for the performance period in which the Closing occurs at the time prescribed by the Seller Cash Incentive Plan as in effect immediately prior to the Closing and in accordance with the historical past practices of Seller and its Affiliates, it being understood that this clause (B) shall not exceed require Purchaser to pay such awards automatically upon the amount of such MICP Payments that were actually paid and to the extent provided in Section 4.2 but multiplied by a fraction the numerator of which equals the number of days in such Seconded Employee’s Period of Secondment and the denominator of which equals the number of days in such Seconded Employee’s Period of Secondment plus the number of days of his or her post-Secondment employment with a Chesapeake Entity through the applicable payment date under the MICPClosing.

Cash Incentive Compensation. Notwithstanding anything herein Following the Closing, Purchaser shall, or shall cause its applicable Subsidiaries to pay awards under Seller Parent cash-based annual incentive plan (the “Seller Cash Incentive Plan”) in which Transferred Employees participate for the performance period in which the Closing occurs, prorated for the period elapsed as of immediately prior to the contraryClosing Date, if the Transfer Date under the Secondment Agreement occurs other than on December 31 of any year during the Period of Secondment, or with respect to all Seconded Employeesany Delayed Transfer Employee, the Services Reimbursement shall include date on which such Delayed Transferred Employee transfers employment (based upon actual performance as determined in good faith in the amountsordinary course of business consistent with past practice by Seller Parent or its applicable Affiliate), if any, of all cash bonus and other cash incentive compensation payments that would be payable to each Transferred Employee who is eligible to receive such an award pursuant to the Seconded Employees through the Transfer Date under the terms and conditions of the applicable Benefit Plans (except that Chesapeake Management maySeller Cash Incentive Plan, in its discretion, consider continued employment by Chesapeake Management through the Transfer Date as satisfying any requirement under any such Benefit Plan of continued employment through year end or date of payment) and such amounts which awards shall be determined on a pro-rated basis for the year that includes the Transfer Date based on the number of days that the Seconded Employee was actually seconded to the General Partner hereunder during the year in which the Transfer Date occurred. Notwithstanding the foregoing, the provisions of this Section 4.3 shall not apply to MICP Payments, paid at such time and 100% of the MICP Payments attributable to awards made to a Seconded Employee during his or her Period of Secondment (regardless of whether such award is actually paid during or after the termination of the Seconded Employee’s Period of Secondment) shall be included in the Services Reimbursement and the Seconded Employee Expenses to the extent that the Transferred Employees would have otherwise become entitled to such MICP Payments are actually paid by a Chesapeake Entity and to bonuses under the extent provided in Section 4.2Seller Cash Incentive Plan (such prorated bonus, the “Seller Closing Bonus”); 143 provided, however, that if Purchaser’s or its applicable Subsidiary’s payment of the Seller Closing Bonus is prohibited under applicable Law, Purchaser and Seller Parent will agree to an alternative arrangement with respect to a Seconded Employee whose Secondment is terminated any such Seller Closing Bonus acting in good faith (which alternative arrangement shall preserve the division of Liabilities between Seller Parent and its Affiliates, on the one hand, and Purchaser and its Affiliates, on the other hand, generally contemplated by this Section 6.6(c)(v)). The aggregate amount of the Seller Closing Bonuses and any related employer-side Taxes (but who remains employed by a Chesapeake Entity following such termination of Secondment, less the amount of the MICP Payments includable Tax deduction that Seller Parent or its Affiliates would have realized had they paid the Seller Closing Bonuses) shall be reflected as a Liability in Business Working Capital. Without limiting the generality of Section 6.6(c)(i), effective as of the Closing, Purchaser shall cause the Transferred Employees to participate in the Services Reimbursement cash-based incentive plans of Purchaser and its Affiliates for the remainder of the performance period in which the Closing occurs, which plans shall provide (A) incentive compensation opportunities that are no less favorable than those provided to such Transferred Employees immediately prior to the Closing (provided that such opportunities may be prorated for the period from and including the Closing Date until the end of the applicable performance period and may be based on reasonable performance criteria established by Purchaser in the ordinary course of business) and (B) for payment of awards for the performance period in which the Closing occurs at the time prescribed by the Seller Cash Incentive Plan as in effect immediately prior to the Closing and in accordance with the historical past practices of Seller and its Affiliates, it being understood that this clause (B) shall not exceed require Purchaser to pay such awards automatically upon the amount of such MICP Payments that were actually paid and to the extent provided in Section 4.2 but multiplied by a fraction the numerator of which equals the number of days in such Seconded Employee’s Period of Secondment and the denominator of which equals the number of days in such Seconded Employee’s Period of Secondment plus the number of days of his or her post-Secondment employment with a Chesapeake Entity through the applicable payment date under the MICPClosing.