Common use of Cash Incentives Clause in Contracts

Cash Incentives. With respect to the fiscal year in which the Distribution occurs, (x) the applicable Spinco Entity shall maintain a bonus plan for the benefit of Spinco Group Employees with substantially the same terms and conditions (including performance goals and bonus targets, as equitably adjusted by Spinco following the Distribution to the extent necessary or appropriate to provide a substantially similar incentive opportunity) as the annual bonus plan applicable to such Spinco Group Employees immediately prior to the Distribution, (y) as soon as reasonably practicable following the end of such fiscal year, the applicable Spinco Entity will pay bonuses payable to each Spinco Group Employee based on the Performance Calculation, and (z) to the extent that such annual bonuses are not reflect in the Spinco Working Capital Adjustment (as the term is defined in the Distribution Agreement), Harbor shall reimburse Spinco for the prorated portion of the total of such bonus payments based on the applicable Spinco Group Employees’ service from the start of such fiscal year until immediately prior to the Distribution Date promptly but in no event later than thirty (30) days after the presentation of a statement setting forth the amount of reimbursement to which Spinco is entitled; provided, however, that, for the avoidance of doubt, no such reimbursement shall be payable with respect to any discretionary bonus payments made by any Spinco Entity to any Spinco Group Employee. Except as provided in the immediately preceding sentence, from and after the Distribution, Spinco shall be solely responsible for funding, paying, and discharging all obligations and Liabilities relating to the cash incentive awards that any Spinco Group Employee is eligible to receive under any commission plan in which the Spinco Group Employees participate, whether such obligation or Liability arises, accrues, is incurred or is reported prior to, on, or after the Distribution, and no Harbor Entity shall have any obligations or Liabilities with respect thereto.

Cash Incentives. With As of the Closing or, if later, the Continuing Employee’s Transition Date, the Acquired Companies shall assume all obligations of Parent and any of its Affiliates to each Continuing Employee pursuant to any cash incentive plan or program set forth on Section 3.21(a) of the Parent Disclosure Schedule, including, without limitation, any seasonal incentive, store incentive or sales- or commission-based programs with respect to the fiscal year in which the Distribution occurs, (x) the applicable Spinco Entity shall maintain a bonus plan for the benefit of Spinco Group Employees Continuing Employee’s service with substantially the same terms and conditions Parent or its Affiliates (including performance goals and bonus targets, as equitably adjusted by Spinco following the Distribution to the extent necessary or appropriate to provide a substantially similar incentive opportunity) as the annual bonus plan applicable to such Spinco Group Employees immediately prior to the Distribution, (y) as soon as reasonably practicable following the end of such fiscal year, the applicable Spinco Entity will pay bonuses payable to each Spinco Group Employee based on the Performance Calculation, and (z) to the extent that such annual bonuses are not reflect in the Spinco Working Capital Adjustment (as the term is defined in the Distribution AgreementAcquired Companies), Harbor shall reimburse Spinco for the prorated portion of the total of such bonus payments based on the applicable Spinco Group Employees’ service from the start of such fiscal year until immediately prior to the Distribution Date promptly but in no event later than thirty (30) days after the presentation of a statement setting forth the amount of reimbursement to which Spinco is entitled; provided, however, that, for the avoidance of doubt, no such reimbursement shall be payable including with respect to any discretionary bonus payments made by performance period or cycle continuing as of the Closing or, if later, the Continuing Employee’s Transition Date (collectively, the “Cash Incentives”). Each Continuing Employee participating in any Spinco Entity Cash Incentive with respect to any Spinco Group performance period continuing as of the Closing or, if later, the Continuing Employee’s Transition Date, shall remain eligible to receive the appropriate cash bonus with respect to such performance period in accordance with the terms of the Cash Incentive; provided, that Parent may at its discretion modify and adjust such Cash Incentive to reduce or prorate the amount payable under such Cash Incentive or, after good faith consultation with the Acquired Companies, adjust the applicable performance conditions in light of the transactions contemplated by the Agreement. Except Any Cash Incentive payable to a Continuing Employee will be paid by the Acquired Companies on behalf of Parent in accordance with the terms of such Cash Incentive (as provided so modified or adjusted in the immediately preceding sentence, from accordance with this Section 7.09 and after the Distribution, Spinco shall be solely responsible for funding, paying, and discharging all obligations and Liabilities including terms relating to the cash incentive awards that timing of payment), which such obligations and amounts shall constitute Assumed Liabilities. To the extent any Spinco Group Employee is eligible Cash Incentive relating to receive under any commission plan performance period or cycle continuing as of the Closing or, if later, the Continuing Employee’s Transition Date requires the determination of performance against any qualitative component or individual performance goal, the achievement of such component or performance shall be determined by Parent in which its sole discretion after good faith consultation with the Spinco Group Employees participate, whether Acquired Companies and such obligation or Liability arises, accrues, is incurred or is reported prior to, on, or after determination shall be applied by in the Distribution, calculation and no Harbor Entity shall have any obligations or Liabilities with respect theretopayment of the relevant Cash Incentive.