Common use of Establishment of Welfare Plans Clause in Contracts

Establishment of Welfare Plans. (a) On or prior to January 1, 2015, KLX shall establish and adopt Welfare Plans that will provide welfare benefits to each eligible KLX Employee who is, as of the Distribution Date, a participant in any of the B/E Welfare Plans (and their eligible spouses and dependents, as the case may be) under terms and conditions that are substantially similar to the B/E Welfare Plans (the “KLX Welfare Plans”). Coverage and benefits under the B/E Welfare Plans shall then be provided to the KLX Employees on an uninterrupted basis under the newly established KLX Welfare Plans which shall contain substantially the same terms and conditions as in effect under the corresponding B/E Welfare Plans immediately prior to the Distribution Date, unless otherwise noted on Schedule 4.01(a). KLX Employees shall cease to be eligible for coverage under the B/E Welfare Plans on January 1, 2015, unless otherwise noted on Schedule 4.01(a). For the avoidance of doubt, KLX shall not participate in any B/E Welfare Plans on or after January 1, 2015, and B/E Employees and Former B/E Employees shall not participate in any KLX Welfare Plans at any time. During the period, if any, after the Distribution Date and before January 1, 2015, coverage for KLX Employees under the B/E Welfare Plans shall be provided pursuant to the terms set forth in the Transition Services Agreement. (b) KLX shall use commercially reasonable efforts to cause all KLX Welfare Plans (to the extent not already waived or taken into account, as applicable, prior to the date hereof) to (i) waive all limitations as to preexisting conditions, exclusions, and service conditions with respect to participation and coverage requirements applicable to KLX Employees, other than limitations that were in effect with respect to such KLX Employees as of the Distribution Date under the B/E Welfare Plans, and (ii) waive any waiting period limitation or evidence of insurability requirement that would otherwise be applicable to a KLX Employee to the extent such KLX Employee had satisfied any similar limitation under the analogous B/E Welfare Plan as of the Distribution Date. (c) Unless otherwise noted on Schedule 4.01(c), B/E shall retain Liability and responsibility in accordance with the applicable B/E Welfare Plan for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) incurred by KLX Employees (and their dependents and beneficiaries) under such plans prior to January 1, 2015 and KLX shall retain Liability and responsibility in accordance with the KLX Welfare Plans for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) incurred by KLX Employees (and their dependents and beneficiaries) on or following January 1, 2015. For purposes of this Section 4.01, a benefit claim shall be deemed to be incurred as follows: (i) when the event giving rise to the benefit under the applicable plan has occurred as set forth in the governing plan documents, if it is clear based on the governing documents of both the B/E Welfare Plan and KLX Welfare Plans which plan should be responsible for the claim or, if not, as follows: (ii) (A) health, dental, vision, employee assistance program, education assistance program and prescription drug benefits (including in respect of any hospital confinement), upon provision of such services, materials or supplies; and (B) life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, or other event giving rise to such benefits. The members of the B/E Group shall retain liability and responsibility in accordance with the applicable B/E Welfare Plan for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) for individuals who, immediately prior to January 1, 2015, are Former KLX Employees (and their dependents and beneficiaries), including any such employee on long-term disability on January 1, 2015.

Establishment of Welfare Plans. (a) On or prior to January 1the Distribution Date, 2015, KLX ESG SpinCo shall establish and adopt Welfare Plans welfare plans that will provide welfare benefits to each eligible KLX ESG Employee who is, as of the Distribution Date, a participant in any of the B/E KLX welfare plans (KLX Welfare Plans Plans) (and their eligible spouses and dependents, as the case may be) under terms and conditions that are substantially similar comparable to the B/E KLX Welfare Plans (the “KLX ESG Welfare Plans”). Coverage and benefits under the B/E KLX Welfare Plans shall then be provided to the KLX ESG Employees on an uninterrupted basis under the newly established KLX ESG Welfare Plans which shall contain substantially the same comparable terms and conditions as in effect under the corresponding B/E KLX Welfare Plans immediately prior to the Distribution Date, unless otherwise noted on Schedule 4.01(a4.1(a). KLX ESG Employees shall cease to be eligible for coverage under the B/E KLX Welfare Plans on January 1the Distribution Date or the Transfer Date, 2015as applicable, unless otherwise noted on Schedule 4.01(a4.1(a). For the avoidance of doubt, KLX ESG SpinCo shall not participate in any B/E KLX Welfare Plans on or after January 1, 2015the Distribution Date, and B/E KLX Employees and Former B/E KLX Employees shall not participate in any KLX ESG Welfare Plans at any time. During the period, if any, after the Distribution Date and before January 1or the Transfer Date, 2015as applicable, coverage for KLX ESG Employees under the B/E KLX Welfare Plans shall be provided pursuant to the terms set forth in the Transition Services Agreement. (b) KLX ESG SpinCo shall use commercially reasonable efforts to cause all KLX ESG Welfare Plans (to the extent not already waived or taken into account, as applicable, prior to the date hereof) to (i) waive all limitations as to preexisting conditions, exclusions, and service conditions with respect to participation and coverage requirements applicable to KLX ESG Employees, other than limitations that were in effect with respect to such KLX ESG Employees as of the Distribution Date or the Transfer Date, as applicable, under the B/E KLX Welfare Plans, and (ii) waive any waiting period limitation or evidence of insurability requirement that would otherwise be applicable to a KLX an ESG Employee to the extent such KLX ESG Employee had satisfied any similar limitation under the analogous B/E KLX Welfare Plan as of the Distribution Date or the Transfer Date, as applicable. (c) Unless otherwise noted on Schedule 4.01(c), B/E 4.1(c) KLX shall retain Liability and responsibility in accordance with the applicable B/E KLX Welfare Plan for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) incurred by KLX ESG Employees (and their dependents and beneficiaries) under such plans prior to January 1the Distribution Date or the Transfer Date, 2015 as applicable, and KLX ESG SpinCo shall retain Liability and responsibility in accordance with the KLX ESG Welfare Plans for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) incurred by KLX ESG Employees (and their dependents and beneficiaries) on or following January 1the Distribution Date or the Transfer Date, 2015as applicable. For purposes of this Section 4.014.1(c), a benefit claim shall be deemed to be incurred as follows: (i) when the event giving rise to the benefit under the applicable plan has occurred as set forth in the governing plan documents, if it is clear based on the governing documents of both the B/E KLX Welfare Plan and KLX ESG Welfare Plans which plan should be responsible for the claim or, if not, as follows: (ii) (A) health, dental, vision, employee assistance program, education assistance program and prescription drug benefits (including in respect of any hospital confinement), upon provision of such services, materials or supplies; and (B) life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, or other event giving rise to such benefits. The members of the B/E KLX Group shall retain liability Liability and responsibility in accordance with the applicable B/E KLX Welfare Plan for all reimbursement claims (such as medical and dental claims) for expenses incurred and for all non-reimbursement claims (such as life insurance claims) for individuals who, immediately prior to January 1, 2015, the Distribution Date are Former KLX ESG Employees (and their dependents and beneficiaries), including any such employee on long-term disability on January 1the Distribution Date. (d) As of the Distribution Date or the Transfer Date, 2015as applicable, ESG SpinCo shall cause the ESG Welfare Plans to recognize and give effect to all elections and designations (including all coverage and contribution elections and beneficiary designations) made by each ESG Employee under, or with respect to, the corresponding KLX Welfare Plan for the plan year in which the Distribution occurs. Notwithstanding the foregoing, nothing in this Section 4.1 will prohibit ESG SpinCo from soliciting or causing the solicitation of new election forms or beneficiary designations from ESG Employees to be effective under the ESG Welfare Plan as of the Distribution Date or the Transfer Date, as applicable.