Miscellaneous Terms and Actions; Tax Reporting and Withholding. (a) From and after the Distribution Date, for purposes of any SpinCo Awards received by any Parent Participant, Parent Director or Dual Director pursuant to Section 8.02 or 8.03, (i) such Parent Participant’s, Parent Director’s or Dual Director’s employment with or service to the Parent Group shall be treated as employment with and service to the SpinCo Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards and (ii) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such SpinCo Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the Parent Equity Plan (or, if applicable, in such Parent Participant’s individual employment or similar agreement with a member of the Parent Group). From and after the Distribution Date, for purposes of any Adjusted Parent Awards received by any SpinCo Participant , SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03, as applicable, (A) such SpinCo Participant’s, SpinCo Director’s or Dual Director’s employment with or service to the SpinCo Group shall be treated as employment with and service to the Parent Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such Adjusted Parent Awards and (B) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such Adjusted Parent Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the SpinCo Equity Plan (or, if applicable, in such SpinCo Participant’s individual employment or similar agreement with a member of the SpinCo Group). From and after the Distribution Date, for purposes of any SpinCo Awards received by any SpinCo Participant, SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03 hereof, such SpinCo Participant’s, SpinCo Director’s or Dual Director’s continued service with any member of the SpinCo Group (and, for the avoidance of doubt, in the case of any Dual Director, with any member of the Parent Group) on and following the Distribution Date shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards (and, in accordance with Section 8.06(c) below, the Distribution shall not be deemed a termination of employment or service for purposes of such SpinCo Awards). The foregoing provisions of this Section 8.06(a) shall apply to the applicable Adjusted Parent Awards and SpinCo Awards, in each case to the extent that such provisions do not result in adverse tax consequences under Section 409A of the Code. (b) From and after the Distribution Date, subject to compliance with any applicable requirements under Section 409A of the Code (if applicable), (x) any reference to a “change in control,” “change of control” or similar term applicable to any Adjusted Parent Award contained in any applicable award agreement, employment or services agreement or the Parent Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in such award agreement, employment or services agreement or the Parent Equity Plan (a “Parent Change in Control”) and (y) any reference to a “change in control,” “change of control” or similar term applicable to any SpinCo Award contained in any applicable award agreement, employment or services agreement or the SpinCo Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in the SpinCo Equity Plan (a “SpinCo Change in Control”). (c) For the avoidance of doubt, the Distribution shall not, in and of itself, be treated as either a Parent Change in Control or a SpinCo Change in Control. Neither the Separation, the Distribution nor any assignment, transfer or continuation of the employment of employees as contemplated by Article III shall, in any such case, be deemed a termination of employment or service of any SpinCo Participant, Parent Participant, SpinCo Director, Parent Director, Solta Director or Dual Director or otherwise constitute a Parent Change in Control or SpinCo Change in Control, in each such case for purposes of the Parent Equity Plan, the SpinCo Equity Plan or any Adjusted Parent Award or SpinCo Award, as applicable. Without limiting the generality of the foregoing, to the extent Parent determines it necessary or desirable, each Parent RSU, Parent PRSU or Parent Option, as the case may be, shall be amended to expressly clarify the same. (d) From and after the Distribution Time, all Adjusted Parent Awards, regardless of by whom held, shall be granted under and subject to the terms of the Parent Equity Plan and shall be settled by Parent, and all SpinCo Awards, regardless of by whom held, shall be granted under and subject to the terms of the SpinCo Equity Plan and shall be settled by the Company. (e) The Company shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a SpinCo Participant or SpinCo Director, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a Parent Participant or Parent Director; provided that (i) with respect to SpinCo Awards held by Parent Participants or Parent Directors (for which Parent is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of SpinCo), prior to the date any such settlement is due, the Company shall pay Parent in cash amounts required to settle any dividend equivalents accrued following the Distribution Time and (ii) with respect to any Adjusted Parent Awards held by SpinCo Participants or SpinCo Directors (for which SpinCo is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of Parent) prior to the date any such settlement is due, Parent shall pay SpinCo in cash amounts required to settle any dividend equivalents accrued following the Distribution Time. With respect to a Dual Director, the Company shall be responsible for the settlement of cash dividend equivalents on any SpinCo Awards, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards. (f) Unless otherwise required by applicable Law and notwithstanding anything in Section 9.02 of this Agreement to the contrary, (i) the applicable member of the SpinCo Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations in respect of SpinCo Participants relating to any Adjusted Parent Awards or SpinCo Awards and (ii) the applicable member of the Parent Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations in respect of Parent Participants relating to any Adjusted Parent Awards or SpinCo Awards. The parties shall facilitate performance by the other party of its obligations hereunder by promptly remitting amounts withheld in respect of any Adjusted Parent Awards or SpinCo Awards, as applicable, directly to the applicable Governmental Authority on such other party’s behalf or to the other Party for remittance to such Governmental Authority. The parties will cooperate and communicate with each other and with third-party providers to effectuate withholding and remittance of taxes, as well as required tax reporting, in a timely, efficient and appropriate manner. (g) The Company shall prepare and file with the SEC a registration statement on an appropriate form with respect to the Resulting Entity Common Shares subject to the Parent Awards converted into SpinCo Awards pursuant to this Article VIII and shall use its reasonable best efforts to have such registration statement declared effective as soon as practicable following the Distribution Date and to maintain the effectiveness of such registration statement covering such SpinCo Awards (and to maintain the current status of the prospectus contained therein) for so long as any such SpinCo Awards remain outstanding. (h) Prior to the Distribution Time, each party shall take all such steps as may be required to cause any dispositions of Parent Common Shares (including Parent Awards or any other derivative securities with respect to Parent Common Shares) or acquisitions of Resulting Entity Common Shares (including SpinCo Awards or any other derivative securities with respect to Resulting Entity Common Shares) resulting from the Distribution or the transactions contemplated by this Agreement or the Master Separation Agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Parent or who are or will become subject to such reporting requirements with respect to the Company to be exempt under Rule 16b-3 promulgated under the Exchange Act. With respect to those individuals, if any, who, subsequent to the Distribution Date, are or become subject to the reporting requirements under Section 16(a) of the Exchange Act, as applicable, the Company shall administer any Parent Award converted into a SpinCo Award pursuant to this Article VIII in a manner that complies with Rule 16b-3 promulgated under the Exchange Act to the extent such converted Parent Award complied with such rule prior to the Distribution Date. (i) From and after the Distribution Date, each of Parent and the Company shall cooperate in good faith to facilitate the orderly administration of the Adjusted Parent Awards and SpinCo Awards held by Parent Participants, SpinCo Participants, Parent Directors, SpinCo Directors, Solta Directors and Dual Directors, as applicable, including, without limitation, the sharing of information relating to such individuals’ employment or service status with the Parent Group (including the Solta Group) or the SpinCo Group, as applicable, as well as other information relating to the vesting and forfeiture of Adjusted Parent Awards or SpinCo Awards, tax withholding and reporting and compliance with applicable Law. (j) Notwithstanding anything to the contrary herein, all adjustments to Parent Awards contemplated by this Article VIII shall be made in accordance with the terms and conditions of the Parent Equity Plan and, to the extent applicable, in a manner consistent with the requirements of Section 409A of the Code and other applicable tax laws (including the ITA). (k) For the avoidance of doubt, (i) the adjustments described in Section 8.02 and Section 8.03 reflect the adjustments that shall be made to the Parent Awards that are outstanding as of immediately prior to the Distribution Date, as a result of, and after giving effect to, the consummation of all of the transactions, in the aggregate, that collectively constitute the Distribution, as detailed in the Plan of Arrangement and the Master Separation Agreement and (ii) for purposes of the treatment of outstanding equity incentive awards set forth in this Article VIII, an individual’s employment status with respect to Parent, SpinCo or Solta, as the case may be, including whether such individual is a current or former employee thereof, shall be determined by reference to such individual’s applicable employment status as of immediately prior to the Distribution.
Appears in 2 contracts
Samples: Employee Matters Agreement (Bausch Health Companies Inc.), Employee Matters Agreement (Bausch & Lomb Corp)
Miscellaneous Terms and Actions; Tax Reporting and Withholding. (a) From and after the Distribution Date, for purposes of any SpinCo Awards received by any Parent Participant, Parent Director or Dual Director pursuant to Section 8.02 or 8.03, (i) such Parent Participant’s, Parent Director’s or Dual Director’s employment with or service to the Parent Group shall be treated as employment with and service to the SpinCo Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards and (ii) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such SpinCo Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the Parent Equity Plan (or, if applicable, in such Parent Participant’s individual employment or similar agreement with a member of the Parent Group). From and after the Distribution Date, for purposes of any Adjusted Parent Awards received by any SpinCo Participant Participant, SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03, as applicable, (A) such SpinCo Participant’s, SpinCo Director’s or Dual Director’s employment with or service to the SpinCo Group shall be treated as employment with and service to the Parent Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such Adjusted Parent Awards and (B) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such Adjusted Parent Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the SpinCo Equity Plan (or, if applicable, in such SpinCo Participant’s individual employment or similar agreement with a member of the SpinCo Group). From and after the Distribution Date, for purposes of any SpinCo Awards received by any SpinCo Participant, SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03 hereof, such SpinCo Participant’s, SpinCo Director’s or Dual Director’s continued service with any member of the SpinCo Group (and, for the avoidance of doubt, in the case of any Dual Director, with any member of the Parent Group) on and following the Distribution Date shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards (and, in accordance with Section 8.06(c) below, the Distribution shall not be deemed a termination of employment or service for purposes of such SpinCo Awards). The foregoing provisions of this Section 8.06(a) shall apply to the applicable Adjusted Parent Awards and SpinCo Awards, in each case to the extent that such provisions do not result in adverse tax consequences under Section 409A of the Code.
(b) From and after the Distribution Date, subject to compliance with any applicable requirements under Section 409A of the Code (if applicable), (x) any reference to a “change in control,” “change of control” or similar term applicable to any Adjusted Parent Award contained in any applicable award agreement, employment or services agreement or the Parent Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in such award agreement, employment or services agreement or the Parent Equity Plan (a “Parent Change in Control”) and (y) any reference to a “change in control,” “change of control” or similar term applicable to any SpinCo Award contained in any applicable award agreement, employment or services agreement or the SpinCo Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in the SpinCo Equity Plan (a “SpinCo Change in Control”).
(c) For the avoidance of doubt, the Distribution shall not, in and of itself, be treated as either a Parent Change in Control or a SpinCo Change in Control. Neither the Separation, the Distribution nor any assignment, transfer or continuation of the employment of employees as contemplated by Article III shall, in any such case, be deemed a termination of employment or service of any SpinCo Participant, Parent Participant, SpinCo Director, Parent Director, Solta Director or Dual Director or otherwise constitute a Parent Change in Control or SpinCo Change in Control, in each such case for purposes of the Parent Equity Plan, Plan or the SpinCo Equity Plan or for any Adjusted Parent Award or SpinCo Award, as applicable. Without limiting the generality of the foregoing, to the extent Parent determines it necessary or desirable, each Parent RSU, Parent PRSU or Parent Option, as the case may be, shall be amended to expressly clarify the same.
(d) From and after the Distribution Time, all Adjusted Parent Awards, regardless of by whom held, shall be granted under and subject to the terms of the Parent Equity Plan and shall be settled by Parent, and all SpinCo Awards, regardless of by whom held, shall be granted under and subject to the terms of the SpinCo Equity Plan and shall be settled by the Company.
(e) The Company shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a SpinCo Participant or SpinCo Director, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a Parent Participant or Parent Director; provided that (i) with respect to SpinCo Awards held by Parent Participants or Parent Directors (for which Parent is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of SpinCo), prior to the date any such settlement is due, the Company shall pay Parent in cash amounts required to settle any dividend equivalents accrued following the Distribution Time and (ii) with respect to any Adjusted Parent Awards held by SpinCo Participants or SpinCo Directors (for which SpinCo is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of Parent) prior to the date any such settlement is due, Parent shall pay SpinCo in cash amounts required to settle any dividend equivalents accrued following the Distribution Time. With respect to a Dual Director, the Company shall be responsible for the settlement of cash dividend equivalents on any SpinCo Awards, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards.
(f) Unless otherwise required by applicable Law and notwithstanding anything in Section 9.02 of this Agreement to the contrary, (i) the applicable member of the SpinCo Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations in respect of SpinCo Participants relating to any Adjusted Parent Awards or SpinCo Awards and (ii) the applicable member of the Parent Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations in respect of Parent Participants relating to any Adjusted Parent Awards or SpinCo Awards. The parties shall facilitate performance by the other party of its obligations hereunder by promptly remitting amounts withheld in respect of any Adjusted Parent Awards or SpinCo Awards, as applicable, directly to the applicable Governmental Authority on such other party’s behalf or to the other Party for remittance to such Governmental Authority. The parties will cooperate and communicate with each other and with third-party providers to effectuate withholding and remittance of taxes, as well as required tax reporting, in a timely, efficient and appropriate manner.
(g) The Company shall prepare and file with the SEC a registration statement on an appropriate form with respect to the Resulting Entity Common Shares subject to the Parent Awards converted into SpinCo Awards pursuant to this Article VIII and shall use its reasonable best efforts to have such registration statement declared effective as soon as practicable following the Distribution Date and to maintain the effectiveness of such registration statement covering such SpinCo Awards (and to maintain the current status of the prospectus contained therein) for so long as any such SpinCo Awards remain outstanding.
(h) Prior to the Distribution Time, each party shall take all such steps as may be required to cause any dispositions of Parent Common Shares (including Parent Awards or any other derivative securities with respect to Parent Common Shares) or acquisitions of Resulting Entity Common Shares (including SpinCo Awards or any other derivative securities with respect to Resulting Entity Common Shares) resulting from the Distribution or the transactions contemplated by this Agreement or the Master Separation Agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Parent or who are or will become subject to such reporting requirements with respect to the Company to be exempt under Rule 16b-3 promulgated under the Exchange Act. With respect to those individuals, if any, who, subsequent to the Distribution Date, are or become subject to the reporting requirements under Section 16(a) of the Exchange Act, as applicable, the Company shall administer any Parent Award converted into a SpinCo Award pursuant to this Article VIII in a manner that complies with Rule 16b-3 promulgated under the Exchange Act to the extent such converted Parent Award complied with such rule prior to the Distribution Date.
(i) From and after the Distribution Date, each of Parent and the Company shall cooperate in good faith to facilitate the orderly administration of the Adjusted Parent Awards and SpinCo Awards held by Parent Participants, SpinCo Participants, Parent Directors, SpinCo Directors, Solta Directors and Dual Directors, as applicable, including, without limitation, the sharing of information relating to such individuals’ employment or service status with the Parent Group (including the Solta Group) or the SpinCo Group, as applicable, as well as other information relating to the vesting and forfeiture of Adjusted Parent Awards or SpinCo Awards, tax withholding and reporting and compliance with applicable Law.
(j) Notwithstanding anything to the contrary herein, all adjustments to Parent Awards contemplated by this Article VIII shall be made in accordance with the terms and conditions of the Parent Equity Plan and, to the extent applicable, in a manner consistent with the requirements of Section 409A of the Code and other applicable tax laws (including the ITA).
(k) For the avoidance of doubt, (i) the adjustments described in Section 8.02 and Section 8.03 reflect the adjustments that shall be made to the Parent Awards that are outstanding as of immediately prior to the Distribution Date, as a result of, and after giving effect to, the consummation of all of the transactions, in the aggregate, that collectively constitute the Distribution, as detailed in the Plan of Arrangement and the Master Separation Agreement and (ii) for purposes of the treatment of outstanding equity incentive awards set forth in this Article VIII, an individual’s employment status with respect to Parent, SpinCo or Solta, as the case may be, including whether such individual is a current or former employee thereof, shall be determined by reference to such individual’s applicable employment status as of immediately prior to the Distribution.
Appears in 1 contract
Miscellaneous Terms and Actions; Tax Reporting and Withholding. (a) From and after the Distribution Date, for purposes of any SpinCo Awards received by any Parent Participant, Parent Director or Dual Director pursuant to Section 8.02 or 8.03, (i) such Parent Participant’s, Parent Director’s or Dual Director’s employment with or service to the Parent Group shall be treated as employment with and service to the SpinCo Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards and (ii) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such SpinCo Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the Parent Equity Plan (or, if applicable, in such Parent Participant’s individual employment or similar agreement with a member of the Parent Group). From and after the Distribution Date, for purposes of any Adjusted Parent Awards received by any SpinCo Participant Participant, SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03, as applicable, (A) such SpinCo Participant’s, SpinCo Director’s or Dual Director’s employment with or service to the SpinCo Group shall be treated as employment with and service to the Parent Group (including with respect to any deferral elections) and shall count towards satisfying any applicable service-based vesting requirements applicable to any such Adjusted Parent Awards and (B) any reference to “cause”, “good reason”, “disability”, “willful” or other similar terms applicable to such Adjusted Parent Awards shall be deemed to refer to the definitions of “cause”, “good reason”, “disability”, “willful” or other similar terms set forth in the SpinCo Equity Plan (or, if applicable, in such SpinCo Participant’s individual employment or similar agreement with a member of the SpinCo Group). From and after the Distribution Date, for purposes of any SpinCo Awards received by any SpinCo Participant, SpinCo Director or Dual Director pursuant to Section 8.02 or 8.03 hereof, such SpinCo Participant’s, SpinCo Director’s or Dual Director’s continued service with any member of the SpinCo Group (and, for the avoidance of doubt, in the case of any Dual Director, with any member of the Parent Group) on and following the Distribution Date shall count towards satisfying any applicable service-based vesting requirements applicable to any such SpinCo Awards (and, in accordance with Section 8.06(c) below, the Distribution shall not be deemed a termination of employment or service for purposes of such SpinCo Awards). The foregoing provisions of this Section 8.06(a) shall apply to the applicable Adjusted Parent Awards and SpinCo Awards, in each case to the extent that such provisions do not result in adverse tax consequences under Section 409A of the Code.
(b) From and after the Distribution Date, subject to compliance with any applicable requirements under Section 409A of the Code (if applicable), (x) any reference to a “change in control,” “change of control” or similar term applicable to any Adjusted Parent Award contained in any applicable award agreement, employment or services agreement or the Parent Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in such award agreement, employment or services agreement or the Parent Equity Plan (a “Parent Change in Control”) and (y) any reference to a “change in control,” “change of control” or similar term applicable to any SpinCo Award contained in any applicable award agreement, employment or services agreement or the SpinCo Equity Plan shall be deemed to refer to a “change in control,” “change of control” or similar term as defined in the SpinCo Equity Plan (a “SpinCo Change in Control”).
(c) For the avoidance of doubt, the Distribution shall not, in and of itself, be treated as either a Parent Change in Control or a SpinCo Change in Control. Neither the Separation, the Distribution nor any assignment, transfer or continuation of the employment of employees as contemplated by Article III shall, in any such case, be deemed a termination of employment or service of any SpinCo Participant, Parent Participant, SpinCo Director, Parent Director, Solta Director or Dual Director or otherwise constitute a Parent Change in Control or SpinCo Change in Control, in each such case for purposes of the Parent Equity Plan, Plan or the SpinCo Equity Plan or for any Adjusted Parent Award or SpinCo Award, as applicable. Without limiting the generality of the foregoing, to the extent Parent determines it necessary or desirable, each Parent RSU, Parent PRSU or Parent Option, as the case may be, shall be amended to expressly clarify the same.
(d) From and after the Distribution Time, all Adjusted Parent Awards, regardless of by whom held, shall be granted under and subject to the terms of the Parent Equity Plan and shall be settled by Parent, and all SpinCo Awards, regardless of by whom held, shall be granted under and subject to the terms of the SpinCo Equity Plan and shall be settled by the Company.
(e) The Company shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a SpinCo Participant or SpinCo Director, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards or SpinCo Awards held by a Parent Participant or Parent Director; provided that (i) with respect to SpinCo Awards held by Parent Participants or Parent Directors (for which Parent is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of SpinCo), prior to the date any such settlement is due, the Company shall pay Parent in cash amounts required to settle any dividend equivalents accrued following the Distribution Time and (ii) with respect to any Adjusted Parent Awards held by SpinCo Participants or SpinCo Directors (for which SpinCo is obligated to settle the applicable cash dividend equivalents in accordance with this Section 8.06(e) on behalf of Parent) prior to the date any such settlement is due, Parent shall pay SpinCo in cash amounts required to settle any dividend equivalents accrued following the Distribution Time. With respect to a Dual Director, the Company shall be responsible for the settlement of cash dividend equivalents on any SpinCo Awards, and Parent shall be responsible for the settlement of cash dividend equivalents on any Adjusted Parent Awards.
(f) Unless otherwise required by applicable Law and notwithstanding anything in Section 9.02 of this Agreement to the contrary, (i) the applicable member of the SpinCo Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations (including the amount of any employer portion of any applicable payroll, employment or similar taxes) (collectively, the “Tax-Related Obligations”) in respect of SpinCo Participants relating to any Adjusted Parent Awards or SpinCo Awards and (ii) the applicable member of the Parent Group shall be responsible for all applicable income, payroll, employment and other similar tax withholding, remittance and reporting obligations Tax-Related Obligations in respect of Parent Participants relating to any Adjusted Parent Awards or SpinCo Awards. The parties Notwithstanding any prior practice between the Groups or anything to the contrary herein, as of the effective date of the amendment, no member of the Parent Group or the SpinCo Group shall facilitate performance by be required to reimburse the other party Group for any Tax-Related Obligations incurred by such other Group pursuant to this Section 8.06(f), regardless of its obligations hereunder by promptly remitting amounts withheld in respect of whether such Tax-Related Obligations relate to any Adjusted Parent Awards or SpinCo Awards, as applicable, directly to the applicable Governmental Authority on such other party’s behalf or to the other Party for remittance to such Governmental Authority. The parties will cooperate and communicate with each other and with third-party providers to effectuate withholding and remittance of taxes, as well as required tax reporting, in a timely, efficient and appropriate manner. Notwithstanding anything set forth herein, Parent shall, prior to the Distribution, take any and all actions necessary and appropriate to amend each outstanding award agreement relating to a Parent RSU, Parent Deferred RSU and Parent PRSU (regardless of whether held by a Parent Participant, SpinCo Participant or any other person) to provide that (i) the resulting Adjusted Parent Awards held by SpinCo Participants following the conversion pursuant to Section 8.02(a) will be subject to “sell-to-cover” with respect to any Tax-Related Obligations in respect thereof and (ii) the resulting SpinCo Awards following the conversion pursuant to Section 8.02(a) held by Parent Participants and any other person will be subject to “sell-to-cover” with respect to any Tax-Related Obligations in respect thereof (together, the “Sell-to-Cover Amendments”). The parties will cooperate and communicate in order to facilitate the “sell-to-cover” procedures with the applicable brokerage.
(g) The Company shall prepare and file with the SEC a registration statement on an appropriate form with respect to the Resulting Entity Common Shares subject to the Parent Awards converted into SpinCo Awards pursuant to this Article VIII and shall use its reasonable best efforts to have such registration statement declared effective as soon as practicable following the Distribution Date and to maintain the effectiveness of such registration statement covering such SpinCo Awards (and to maintain the current status of the prospectus contained therein) for so long as any such SpinCo Awards remain outstanding.
(h) Prior to the Distribution Time, each party shall take all such steps as may be required to cause any dispositions of Parent Common Shares (including Parent Awards or any other derivative securities with respect to Parent Common Shares) or acquisitions of Resulting Entity Common Shares (including SpinCo Awards or any other derivative securities with respect to Resulting Entity Common Shares) resulting from the Distribution or the transactions contemplated by this Agreement or the Master Separation Agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Parent or who are or will become subject to such reporting requirements with respect to the Company to be exempt under Rule 16b-3 promulgated under the Exchange Act. With respect to those individuals, if any, who, subsequent to the Distribution Date, are or become subject to the reporting requirements under Section 16(a) of the Exchange Act, as applicable, the Company shall administer any Parent Award converted into a SpinCo Award pursuant to this Article VIII in a manner that complies with Rule 16b-3 promulgated under the Exchange Act to the extent such converted Parent Award complied with such rule prior to the Distribution Date.
(i) From and after the Distribution Date, each of Parent and the Company shall cooperate in good faith to facilitate the orderly administration of the Adjusted Parent Awards and SpinCo Awards held by Parent Participants, SpinCo Participants, Parent Directors, SpinCo Directors, Solta Directors and Dual Directors, as applicable, including, without limitation, the sharing of information relating to such individuals’ employment or service status with the Parent Group (including the Solta Group) or the SpinCo Group, as applicable, as well as other information relating to the vesting and forfeiture of Adjusted Parent Awards or SpinCo Awards, tax withholding and reporting and compliance with applicable Law.
(j) Notwithstanding anything to the contrary herein, all adjustments to Parent Awards contemplated by this Article VIII shall be made in accordance with the terms and conditions of the Parent Equity Plan and, to the extent applicable, in a manner consistent with the requirements of Section 409A of the Code and other applicable tax laws (including the ITA).
(k) For the avoidance of doubt, (i) the adjustments described in Section 8.02 and Section 8.03 reflect the adjustments that shall be made to the Parent Awards that are outstanding as of immediately prior to the Distribution Date, as a result of, and after giving effect to, the consummation of all of the transactions, in the aggregate, that collectively constitute the Distribution, as detailed in the Plan of Arrangement and the Master Separation Agreement and (ii) for purposes of the treatment of outstanding equity incentive awards set forth in this Article VIII, an individual’s employment status with respect to Parent, the Parent Group or the SpinCo or SoltaGroup, as the case may be, including whether such individual is a current or former employee thereof, shall be determined by reference to such individual’s applicable employment status as of immediately prior to the Distribution.
(l) Notwithstanding anything to the contrary herein or in the Arrangement Agreement or the Plan of Arrangement, in no event shall the definition of the “Basket Ratio” (or any terms incorporated therein) be amended or in any way altered or modified unless mutually agreed in writing by Parent and SpinCo.
Appears in 1 contract
Samples: Employee Matters Agreement (Bausch Health Companies Inc.)