Common use of Labor Relations; Employees and Employee Benefit Plans Clause in Contracts

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a) of the Seller Disclosure Letter sets forth, as of the date hereof, each material Benefit Plan and separately identifies each material International Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each case, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, (ii) the most recent Form 5500 Annual Report, (iii) the most recent audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity and (v) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreement. (b) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employees.

Appears in 2 contracts

Samples: Asset Purchase Agreement (Broadcom Inc.), Asset Purchase Agreement (Symantec Corp)

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Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, each material Benefit Plan and separately identifies as such each material International Purchased Company Benefit Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has Sellers have made available to Purchaser Buyer correct and complete copies of each Benefit Plan (or, to the extent that no such copy exists, a an accurate written description ofthereof). In addition, in with respect to each casePurchased Company Benefit Plan, Sellers have made available to Buyer, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, agreement or other funding instrument; (ii) the most recent Form 5500 Annual Reportcurrently effective summary plan description required under ERISA, (iii) the most recent audited financial statement IRS determination letter; and actuarial valuation, (iv) all material filings the most recent (A) Form 5500 and correspondence with any Governmental Entity attached schedules, (B) audited financial statements and (vC) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreementactuarial valuation reports. (b) Except Each Benefit Plan in which Business Employees participate that is intended to be “qualified” within the meaning of Section 401(a) of the Code has received a favorable determination letter from the IRS as to its qualification or is in the process of obtaining such a letter and, to the Knowledge of Sellers, no event has not had and would not occurred since the issuance of the determination letters referred to in this clause (b) that could reasonably be expected to have, individually or result in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect revocation of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related theretosuch determination letters. (c) Each Purchased Company Benefit Plan has been operated in material compliance with its terms and applicable Law. All contributions, premiums and expenses required to be made to or paid in respect of Business Employees covered under a Benefit Plan, whether by Law or by the terms of the Benefit Plan or any agreement relating thereto, have been timely made. (d) Except as set forth on Section 3.15(d) of the Seller Disclosure Schedules, no Benefit Plan is subject to Title IV of ERISA, is a Multiemployer Plan or is a “multiple employer welfare arrangement” within the meaning of Section 3(40) of ERISA. No liability under Title IV of ERISA has been incurred by Seller any Seller, any Purchased Company or its Subsidiaries any Subsidiary of a Purchased Company or any of their respective ERISA Affiliates that has not been satisfied in fullfull when due, and to Seller’s Knowledge no condition exists that is likely could reasonably be expected to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any result in Buyer incurring a Liability with respect to an employee benefit plan subject to Section 302 or under Title IV of ERISA by reason of any Benefit Plan. No Benefit Plan subject to the minimum funding requirements of Section 412 of the Code or Section 412, 430 or 4971 302 of the Code. None of Seller, its Subsidiaries ERISA or any trust established thereunder has failed to satisfy such requirements (determined without regard to any waiver thereof), and all contributions required to be made with respect thereto (whether pursuant to the terms of their respective ERISA Affiliates has incurred a Benefit Plan or is reasonably expected to incur any Controlled Group Liability that has not otherwise) have been satisfied in fulltimely made. (de) Neither Except as set forth on Section 3.15(e) of the SellerSeller Disclosure Schedules, its Subsidiaries neither the execution of this Agreement nor the consummation of the transactions contemplated by this Agreement (whether alone or together with any other events) will (i) result in any payment that is the Liability of any of their respective ERISA Affiliates hasthe Purchased Companies becoming due to any Business Employee (as defined herein), at (ii) increase any time during benefits otherwise payable by any of the preceding six (6) years, contributed to, been obligated to contribute Purchased Companies to or had in respect of any liability Business Employee or (including iii) result in the acceleration of the time of payment or vesting of any contingent liability) with respect such benefits. No Purchased Company or Subsidiary of a Purchased Company is a party to any Multiemployer Plan plan, program, policy, agreement or a plan arrangement that has two (2) could result, separately or more contributing sponsorsin the aggregate, at least two (2) in the payment of whom are not under any common controlexcess parachute payments(within the meaning of Section 4063 280G of ERISAthe Code by reason of the Transaction. (f) There are no pending or, to the Knowledge of Sellers, threatened claims by or on behalf of any Purchased Company Benefit Plan, by any employee or beneficiary covered under any Purchased Company Benefit Plan in their capacity as such or otherwise involving any Purchased Company Benefit Plan (other than routine claims for benefits). (eg) No Benefit Plan provides benefits, including death or medical welfare benefits (whether or not insured), with in respect to current or former of Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwisecoverage mandated solely by applicable Law, (ii) increase any death benefits otherwise payable to any Business Employee under any Benefit Plan“pension plan” within the meaning of Section 3(2) of ERISA, or (iii) result in any acceleration benefits the full costs of which are borne by the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptionshis beneficiary. (h) Each Purchased Company Benefit Plan has been maintained to the extent applicable in material compliance with Section 3.7(h) 409A and Section 457A of the Seller Disclosure Letter (i) contains a true and complete list of each Code. No Purchased Company Benefit Plan is an International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal yearBenefit Plan. (i) With respect to each International Benefit Plan: (i) all employer and employee contributions required by Law or by the Business Employees and Business Service Providers, Seller and its Subsidiaries are and terms of the International Benefit Plan have been since April 3made, 2015 or, if applicable, accrued, in compliance accordance with normal accounting practices; (ii) the fair market value of the assets of each funded International Benefit Plan, the liability of each insurer for any International Benefit Plan funded through insurance or the book reserve established for any International Benefit Plan, together with any accrued contributions, is sufficient to procure or provide for the accrued benefit obligations with respect to all current and former participants in such International Benefit Plan according to the actuarial assumptions and valuations most recently used to determine required contributions to or in respect of such International Benefit Plan and no transaction contemplated by this Agreement will cause such assets or insurance obligations to be less than such benefit obligations; and (iii) each International Benefit Plan required to be registered with any Governmental Entity has been registered and has been maintained in good standing with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse EffectGovernmental Entities. (j) Set forth on Section 3.15(j) of the Seller has provided to Purchaser Disclosure Schedules is a true, correct and complete and accurate list of each Collective Bargaining Agreement applicable to any Current Business Employee as of the date hereof (such listEmployees. No Current Business Employees are represented by any labor organization, as updated from time to time pursuant to Section 5.6(c)union, the “Service Provider List”), and, works council or similar representative body with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title their employment with Sellers or position; (ii) original date any of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call paytheir Affiliates. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with With respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a the Business Service Provider who provides services Employees, within the last two (2) years, there have been no actual, or to Business through a third party agencythe Knowledge of Sellers, (B) provide the name threatened material arbitrations, Proceedings, grievances, labor disputes, strikes, lockouts, slowdowns or work stoppages against or affecting any Seller or any Affiliate of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work locationany Seller. (k) Every With respect to the Purchased Companies or the Current Business Employee as Employees, no labor organization, union, works council, or group of employees of any Seller, any Affiliate of any Seller or any other Purchased Company or Subsidiary of a Purchased Company has made a currently pending demand for recognition or certification, and there are no representation or certification proceedings or petitions seeking a representation proceeding presently pending or threatened in writing to be brought or filed with the date hereof National Labor Relations Board or any other labor relations tribunal or authority. No Seller and no Affiliate of any Seller has been primarily dedicated any Knowledge of any labor union organizing activities with respect to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Current Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the BusinessEmployees. (l) With respect to Business Employees and independent contractors who provide services to the Business (including outside sales representatives), each Seller, each Affiliate of any Seller and each other Purchased Company or Subsidiary of a Purchased Company are and have been in compliance in all material respects with all applicable Laws respecting employment and employment practices, including all laws respecting terms and conditions of employment, classification of employees and independent contractors, health and safety, wages and hours, child labor, immigration, employment discrimination, disability rights or benefits, equal opportunity, plant closures and layoffs, affirmative action, workers’ compensation, labor relations, employee leave issues and unemployment insurance. (m) With respect to the Business or Current Business Employees, neither no Seller, no Affiliate of any Seller nor any and no other Purchased Company or Subsidiary of its Subsidiaries a Purchased Company is a party to, or bound by, any Collective Bargaining Agreement. Except as and has not been and would not reasonably be expected to be material to the Business, taken as a whole, been: (i) neither a “contractor” or “subcontractor” (as defined by Executive Order 11246), (ii) required to comply with Executive Order 11246 or (iii) required to maintain an affirmative action plan. (n) No Seller, no Affiliate of any Seller and no other Purchased Company or Subsidiary of a Purchased Company is delinquent in payments to any Business Employee for any services or amounts required to be reimbursed or otherwise paid. (o) Set forth on Section 3.15(o) of the Seller nor Disclosure Schedules is a true and correct list, as of the date hereof, of each Current Business Employee, and for each Current Business Employee such Current Business Employee’s (i) name and job title, (ii) principal work location, (iii) hire date, (iv) work status (i.e. full-time, part-time, temporary, etc.), (v) status as exempt or non-exempt (if a Current U.S. Business Employee), (vi) active or inactive status, (vii) base salary or base wage rate and (viii) annual bonus potential. Sellers shall update such list not less than five (5) Business Days prior to the Closing and at Buyer’s reasonable request. (p) Set forth on Section 3.15(p) of the Seller Disclosure Schedules is a true and correct list of each independent contractor who provides services to the Business (including each outside sales representative), and each such individual’s (i) name and function, (ii) principal work location, (iii) hire date, and (iv) fee rate. (q) With respect to Current Business Employees, no Seller, no Affiliate of any Seller and no other Purchased Company or Subsidiary of its Subsidiaries is (or a Purchased Company has during received within the past last two (2) years beenany written (i) subject to a material notice of any unfair labor disputepractice charge or complaint pending before the National Labor Relations Board or any other Governmental Entity against them, strike or work stoppage and (ii) there are notice of any complaints, grievances or arbitrations arising out of any Collective Bargaining Agreement, (iii) notice of any charge or complaint with respect to or relating to them pending before the Equal Employment Opportunity Commission or any other Governmental Entity responsible for the prevention of unlawful employment practices, (iv) notice of the intent of any Governmental Entity responsible for the enforcement of labor, employment, wages and hours of work, child labor, immigration, or occupational safety and health laws to conduct an investigation with respect to or relating to them or notice that such investigation is in progress, or (v) notice of any complaint, lawsuit or Proceeding pending or threatened in any governmental forum by or on behalf of any Business Employee or current or former independent contractor (including any outside sales representative) or any applicant for employment or engagement or any classes of the foregoing. (r) Each Seller, each Affiliate of any Seller and each other Purchased Company or Subsidiary of a Purchased Company is and has been in compliance in all material respects with all notice and other requirements under the Worker Adjustment and Retraining Notification Act and any similar foreign, state or local Law relating to plant closings and layoffs. (s) To the Knowledge of Sellers, no organizational efforts Business Employee or independent contractor is in any respect in violation of any material term of any employment Contract, Restrictive Covenant or other obligation: (i) to any Seller or any Affiliate of any Seller or (ii) to a former employer of any such individual relating (A) to the right of any such individual to be employed by any Seller or any Affiliate of any Seller or (B) to the knowledge or use of trade secrets or proprietary information. (t) To the Knowledge of Sellers, as of the date of this Agreement, no Current Business Employee with an annual salary of $100,000 or above has given or has been given, notice of termination of employment or otherwise provided written notice of an intention to terminate his or her employment with the Business in the next six (6) months. (u) Each Seller, each Affiliate of any Seller and each other Purchased Company or Subsidiary of a Purchased Company is in material compliance with any requirement to inform or consult with any labor organization, union, works council or employee representative body with respect to the formation transactions contemplated by this Agreement or under any Collective Bargaining Agreement. (v) The execution of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in any breach or other violation of any Collective Bargaining Agreement, employment Contract, independent contractor (including any outside sales representative) Contract, or any other material labor-related agreement to which any Purchased Company or Subsidiary of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business EmployeesPurchased Company is a party.

Appears in 2 contracts

Samples: Purchase Agreement (Hd Supply, Inc.), Purchase Agreement (Anixter International Inc)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a) of the Seller Disclosure Letter sets forth, as of the date hereof, each material Benefit Plan and separately identifies each material International Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each case, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, (ii) the most recent Form 5500 Annual Report, (iii) the most recent audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity and (v) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreement. (b) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each -42- Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employees.

Appears in 1 contract

Samples: Asset Purchase Agreement

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth, as forth a true and complete list of the date hereof, each material Benefit Plan and separately identifies each material International Purchased Company Benefit Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each casePurchaser, to the extent applicable, (i) all plan documentscorrect and complete copy of each such material Benefit Plan document (or, with respect to any material Benefit Plan that is not a Purchased Company Benefit Plan, a written summary plan descriptions, summaries of its material modifications, and amendments related to such plans terms) and any related trust agreementagreement or other funding instrument, and any amendments thereto; (ii) the most recent Form 5500 Annual Report, summary plan description and any summary of material modification thereto; (iii) the most recent audited financial statement Internal Revenue Service determination letter and actuarial valuationany pending request for such a letter, if applicable; (iv) all material filings for any Purchased Company Benefit Plan, the most recent (A) annual report or Form 5500 and correspondence with any Governmental Entity attached schedules (if applicable), (B) audited financial statements, and (C) actuarial valuation reports, and (v) all material related agreements, insurance contracts and other agreements which implement each such for any Purchased Company Benefit Plan. Seller will make available to Purchaser each item , any non-routine filings made in clauses (i) through (v) respect of the immediately preceding sentence such Purchased Company Benefit Plan with respect to a material International Plan within 30 days following the date of this Agreementany Governmental Entity. (b) Each Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable determination letter as to its qualification, and to Seller’s Knowledge, there are no facts or circumstances that would be reasonably likely to adversely affect the qualified status of any such Benefit Plan or the exempt status of any related trust. (c) Each Purchased Company Benefit Plan has been maintained, administered and operated in material compliance with its terms and applicable Law. With respect to any applicable German Purchased Company Benefit Plans, Seller has complied in all material respects with the statutory duty to review any pension increases according to section 16 German Act on Company Pension Schemes (Gesetz zur Verbesserung der betrieblichen Altersversorgung – BetrAVG). (d) Except as has not had and would not reasonably be expected to havebe, individually or in the aggregate, material to the Business, all contributions, premiums and expenses required to be made by Law or by the terms of a Business Material Adverse EffectPurchased Company Benefit Plan or any agreement relating thereto have been timely made. Seller and the Purchased Companies and their assets are not, (iand do not expect to be, in respect of any of the Purchased Companies, subject to any Lien pursuant to Section 430(k) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, of the Code and, in or Sections 303(k) or 4068 of ERISA. In each case, except as would not reasonably be expected to be, individually or in the regulations thereunderaggregate, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant material to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereofBusiness, there are no pending, or to Seller’s Knowledge, threatened threatened, audits, inquiries or anticipated investigations by the Internal Revenue Service, Department of Labor or any other Governmental Entity involving any Purchased Company Benefit Plan, and no pending, or to Seller’s Knowledge, threatened, claims, actions, investigations suits or audits proceedings involving (other than routine claims for benefitsi) by, on behalf of or against any Assumed International Purchased Company Benefit Plan or the benefits payable thereunder or (ii) the provision by any trusts Purchased Group Company of (or failure to provide) any pension, lump sum, death or ill-health benefits in respect of any employee or officer or former employee or officer. With the exception of Liabilities in respect of the Purchased Company Benefit Plans, no Liability on any Purchased Company will be triggered, or has been triggered and remains unsatisfied, as a result of a Purchased Company’s cessation of participation in, or sponsorship of, any defined benefit occupational pension scheme arrangements for the provision of pension and pension-related theretobenefits in respect of its current or former employees. (ce) No liability under Except as set forth on Section 3.15(e) of the Seller Disclosure Schedules, no Benefit Plan is subject to Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that Purchased Company Benefit Plan is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee a defined benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Codepension plan. None of Seller, its Subsidiaries any of the Purchased Companies, or any of their respective ERISA Affiliates has incurred any liability to or is reasonably expected on account of, any Benefit Plan pursuant to incur any Controlled Group Liability that Title IV of ERISA, during the six (6) years preceding the date of this Agreement, which has not been satisfied in fullfully paid. (df) Neither Except as required by applicable Law or as set forth on Section 3.15(f) of the Seller Disclosure Schedules, neither the execution of this Agreement nor the consummation of the Transaction (whether alone or together with any other events) will (i) result in any material payment that is the liability of the Business becoming due to any Business Employee, (ii) materially increase any benefits otherwise payable by the Business to any Business Employee, (iii) result in the acceleration of the time of payment or vesting of any such benefits, or (iv) result in any “parachute payment” under Section 280G of the Code (or any corresponding provision of state, local, or foreign tax law). (g) Section 3.15(g) of the Seller Disclosure Schedules contains a list of each Multiemployer Plan to which Seller, its Subsidiaries nor any Purchased Company or any of their respective ERISA Affiliates hascontributes, at any time during the preceding six (6) yearsor is required to contribute, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Business Employee (the “Business Multiemployer Plans”). Except as set forth on Section 3.15(g) of the Seller Disclosure Schedules: (i) None of Seller, any Purchased Company, or any of their respective ERISA Affiliates has withdrawn from a Business Multiemployer Plan in a “complete withdrawal” or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under common controlpartial withdrawal(within the meaning of Section 4063 as defined in Sections 4203 and 4205 of ERISA)., respectively, so as to result in a liability of the Seller or its ERISA Affiliates, which has not been fully paid, and (eii) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured)To Seller’s Knowledge, with respect to current or former each Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amendedMultiemployer Plan: (A) no such Business Multiemployer Plan has been, or comparable U.S. state Lawhas given notice to Seller that it will be, terminated or Insolvent under ERISA so as to result, directly or indirectly, in any material Liability of a Seller or its ERISA Affiliates under Title IV of ERISA; and (B) no proceeding has been initiated by any Person (including the Pension Benefit Guaranty Corporation) to terminate any Business Multiemployer Plan. (fh) Neither Except with respect to any collective bargaining agreements set forth on Section 3.15(h) of the Seller Disclosure Schedules, neither the execution and delivery of this Agreement nor the consummation of the Transactions transactions contemplated hereby will (either alone or in conjunction combination with any other another event) will, except as required by give rise to any liability under Section 4062(e) of ERISA or trigger the terms imposition of this Agreement, Withdrawal Liability on a Purchased Company or one of its ERISA Affiliates. (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Set forth on Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h3.15(i) of the Seller Disclosure Letter Schedules is a true and correct list and true and complete copies of (or, as applicable (including where no written agreement exists), full details all material facts and matters relating to), as of the date of this Agreement, each and all collective bargaining agreements with any trade union, staff association, European or national or local works council or other body representing all or any of the Business Employees. During the three (3)-year period immediately prior to the date of this Agreement, there have been no material strikes, work stoppages, work slowdowns or lockouts or other form of industrial action involving any of the Business Employees and, as at the date of this Agreement, no such industrial action is, to the Knowledge of Seller, threatened between (i) contains a true and complete list the Seller or any of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, its Affiliates and (ii) for which liabilities are recognized in the ordinary course a material number or category of Seller’s financial reporting practice andBusiness Employees, with respect or any trade union, staff association, European or national or local works council or other body representing or seeking to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the represent any Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amendedEmployee, except as has for such strikes or lockouts or other form of industrial action the existence of which have not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list Except as set forth on Section 3.15(j) of the Disclosure Schedule, the fair market value of the assets of each Business Employee funded Purchased Company Benefit Plan, the liability of each insurer for any Purchased Company Benefit Plan funded through insurance or the book reserve established for any Purchased Company Benefit Plan, together with any accrued contributions, is at least equal to the value of the accrued benefit obligations, as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), andhereof, with respect to each all current or former participants in such individual, plan calculated in accordance with the following information, if applicable, actuarial assumptions and valuations most recently used to determine the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, funding level in the date most recent ongoing valuation of such terminationPurchased Company Benefit Plan (without prejudice to any other jurisdiction, in the date UK such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days valuation being a valuation undertaken under Part 3 of the date hereofPensions Act 2004), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee Except (if applicable) in relation to the Purchased Company Benefit Plans or except as would not reasonably be expected to be, individually or in the aggregate, material to the Business, to the Knowledge of Seller, no facts or circumstances exist as a result of which the UK Pensions Regulator would impose a material sanction on any Purchased Company in respect of any defined benefit occupational pension scheme arrangements for the provision of pension and pension-related benefits in respect of its current or former employees. (l) The Seller Entities are not a party to, or otherwise bound by, any material consent decree with, or citation by, any Governmental Entity relating to any of the Business Employees or employment practices affecting the Business Employees. (m) To Seller’s knowledge, no campaigns are being conducted to solicit authorization cards from or otherwise organize any of the Business Employees by any labor organization, works council or union, and no such campaigns have been conducted within the three (3) year period immediately preceding the date hereof has been primarily dedicated of this Agreement. (n) The Seller Entities are in material compliance with all applicable laws, agreements, contracts, policies, plans, and programs relating to employment, employment practices, compensation, benefits, hours, terms and conditions of employment, and the termination of employment, including but not limited to any obligations pursuant to the Worker Adjustment and Retraining Notification Act of 1988 (or similar state or local laws) (collectively, the “WARN Act”), the classification of employees as exempt or non-exempt from overtime pay requirements, the provision of meal and rest breaks, pay for all working time, and the proper classification of individuals as non-employee contractors or consultants, in all such cases with respect to the Business since December 31Employees. (o) Except as set forth on Section 3.15(o) of the Seller Disclosure Schedules (which shall set forth a true and correct list of each such employee that identifies such employee by his or her identification number, 2018 title and principal work location), during the six (or, for any such Business Employee hired after December 31, 2018, since 6) months prior to the date of such Business Employee’s hire). Since December 31this Agreement, 2018, there has been no transfer of employment or reallocation of the duties or responsibilities of any employee of Seller or any of its Subsidiaries Affiliates (i) who was either actively and primarily engaged in the Business or primarily dedicated to supporting the Business, in either case, that has resulted in such employee ceasing to be so actively engaged or dedicated, as applicable, as of the date of this Agreement; or (ii) who was not (A) actively and primarily engaged in the Business has been transferred or (B) primarily dedicated to any division or business unit supporting the Business, in each case, during the entirety of such six (6) month period (or, if lesser, the entire continuous period of such employee’s employment by Seller and its Subsidiaries other than the Business. (l) With respect Affiliates prior to the Business Employees, neither Seller nor any date of its Subsidiaries is a party to, or bound by, any Collective Bargaining this Agreement. Except as ) that has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation resulted in such employee becoming either an employee of a collective bargaining unit presently being made orPurchased Entity or so actively engaged or dedicated, to in each case, as of the Seller’s Knowledge, threatened involving Business Employeesdate of this Agreement.

Appears in 1 contract

Samples: Stock and Asset Purchase Agreement (Cbre Group, Inc.)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth as of the date of this Agreement a list of each Business Employee, each Business Employee’s date of hire, job title, location, status (exempt/non-exempt, full-time/part-time), current base salary or wage rate, and target annual quarterly or other bonus opportunity for 2021. (b) Section 3.15(b) of the Seller Disclosure Schedules sets forth, as of the date hereofof this Agreement, a list of each material Benefit Plan and separately identifies each material International Purchased Entity Benefit Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of each such Purchased Entity Benefit Plan (or, to the extent if no such copy exists, a written description of)thereof) and any summary plan descriptions. In addition, in with respect to each casePurchased Entity Benefit Plan, Seller has made available to Purchaser, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreementagreement or other funding instrument, and (ii) the most recent Form 5500 Annual Reportaudited financial statements and actuarial valuation reports. (c) With respect to each Purchased Entity Benefit Plan, except as would not, individually or in the aggregate, reasonably be expected to be material and adverse to the Business and the Purchased Entities: (i) each Purchased Entity Benefit Plan has been operated in compliance in all material respects with its terms and applicable Law, and (ii) all material contributions required to be made by applicable Law or by the terms of a Purchased Entity Benefit Plan have been timely made or accrued in accordance with GAAP. Except as would not, individually or in the aggregate, reasonably be expected to be material and adverse to the Business and the Purchased Entities, there are no material Proceedings (other than Proceedings for benefits in the ordinary course of business consistent with past practice) pending, or to the Knowledge of Seller, threatened against any Purchased Entity Benefit Plan. (d) Except as would not, individually or in the aggregate, reasonably be expected to be material and adverse to the Business and the Purchased Entities, each Purchased Entity Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable determination letter as to its qualification, and, to the Knowledge of Seller, no event has occurred that could result in the revocation or loss of such tax qualified status. (e) No Purchased Entity Benefit Plan is subject to Title IV of ERISA, and neither Seller nor any of its Affiliates in respect of any Business Employee, nor any of the Purchased Entities has, within the prior six (6) years, maintained, sponsored or contributed to a plan subject to Title IV of ERISA. Except as would not, individually or in the aggregate, reasonably be expected to be material and adverse to the Business and the Purchased Entities, no events have occurred with respect to any Benefit Plan or Purchased Entity Benefit Plan that would reasonably be expected to subject the Purchaser or the Purchased Entities or any of their respective Affiliates to any material excise or penalty Taxes under the Code, ERISA or other applicable Laws. (f) Neither Seller nor any of its ERISA Affiliates contributes to or is required to contribute to a Multiemployer Plan or multiple employer plan within the meaning of Section 413(c) of the Code, in each case with respect to Business Employees. (g) Except as required by applicable Law or as provided in this Agreement, neither the execution of this Agreement nor the consummation of the Transaction (whether alone or together with any other events) will (i) result in any material payment that is the Liability of the Business becoming due to any Business Employee, (ii) materially increase any benefits otherwise payable by the Business to any Business Employee or (iii) result in the most recent audited financial statement and actuarial valuation, acceleration of the time of payment or vesting of any such benefits. (ivh) all material filings and correspondence with any Governmental Entity and (v) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (vSection 3.15(h) of the immediately preceding sentence with respect to a material International Plan within 30 days following Seller Disclosure Schedules sets forth, as of the date of this Agreement, a list of each collective bargaining agreement of Seller or any of its Subsidiaries to which any Business Employees are subject (collectively, the “Collective Bargaining Agreements”). During the three (3)-year period immediately prior to the date of this Agreement, there have been no strikes or lockouts involving Business Employees. (bi) Except as With respect to the Purchased Entities: (i) Each Purchased Entity is, and at all relevant times has been, in compliance in all material respects with all applicable Laws and orders with respect to labor relations, employment and employment practices, including occupational safety and health standards, terms and conditions of employment or services, payment of wages or other compensation, minimum wages, overtime, classification of employees, employment equality, age discrimination, immigration, visa, work status, human rights, pay equity and workers’ compensation, and is not had engaged in any unfair labor practice. The employment or services of each former employee, consultant or contractor of the Purchased Entities was terminated in material compliance with all applicable Laws, and the Purchased Entities do not have, and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any material Liability with respect to an employee benefit plan subject to Section 302 any such former employees, consultants or Title IV contractors for any such termination of ERISA employment or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in fullservices. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to havenot, individually or in the aggregate, reasonably be expected to be material and adverse to the Business and the Purchased Entities, taken as a Business Material Adverse Effectwhole, each Assumed International Plan (i) has been operated all individuals performing services for the Purchased Entities are correctly classified in conformance with all material respects under all applicable Laws as either “independent contractors” or “employees” and individuals classified as “independent contractors” are not entitled to the rights of an employee of the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and Purchased Entity. (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) Without limiting the generality of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice andany other representation herein, with respect to each such planIsraeli Business Employee employed by a Purchased Entity (each, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amendedan “Israeli Employee”), except as has not had and would not reasonably be expected to havenot, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material and adverse to the BusinessBusiness and the Purchased Entities, taken as a whole: (A) all obligations of the applicable Purchased Entity to provide statutory severance pay to such Israeli Employee are in accordance with Section 14 of the Israeli Severance Pay Law (5723-1963) (the “Severance Pay Law”) and are fully funded (except for funding to be made in the ordinary course for the working month during which this Agreement was executed, (ior the Closing occurs, as applicable) neither or are accrued on the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) applicable Purchased Entity’s financial statements, and all Israeli Employees have been subject to the provisions of Section 14 of the Severance Pay Law with respect to their entire salary, as defined under the Severance Pay Law from the date of commencement of their employment with the applicable Purchased Entity, and the applicable Purchased Entity has been in compliance in all material respects with the requirements of a material labor disputeSection 14 Arrangement (as defined under the Severance Pay Law) with respect to severance pay with respect to the full amount of such salary for which severance pay is due under the Severance Pay Law; (B) no Israeli Employee’s employment by the applicable Purchased Entity requires any special license, strike permit or work stoppage and other authorization by any Governmental Entity; (iiC) there are no organizational efforts with respect unwritten policies, practices or customs of the applicable Purchased Entity that entitle any Israeli Employee to material benefits in addition to what such Israeli Employee is entitled to by applicable Laws or under the formation terms of a collective bargaining unit presently being such Israeli Employee’s employment Contract (including unwritten customs or practices concerning bonuses, the payment of statutory severance pay even when not required under applicable Law, etc.); and (D) all amounts that the applicable Purchased Entity is legally or contractually required either (I) to deduct from such Israeli Employee’s salary or to transfer to such Israeli Employee’s pension or provident, life insurance, incapacity insurance, advance study fund (Keren Hishtalmut) or other similar funds or (II) to withhold from such Israeli Employee’s salary and benefits and to pay to any Israeli Governmental Entity as required by applicable Israeli Tax Law, have, in each case, been duly deducted, transferred, withheld and paid, and the Purchased Entity has no outstanding obligation to make any such deduction, transfer, withholding or payment (except for deduction, transfer, withholding and payments to be made orin the ordinary course after the date of this Agreement or after the Closing, to as applicable, for the Seller’s Knowledgeworking month during which this Agreement was executed, threatened involving Business Employeesor the Closing occurs, as applicable).

Appears in 1 contract

Samples: Stock and Asset Purchase Agreement (PERRIGO Co PLC)

Labor Relations; Employees and Employee Benefit Plans. (a) On the date hereof, Seller has delivered to Purchaser a true and complete anonymized list of each Business Employee as of the date hereof setting forth each such Business Employee’s (i) title/position, (ii) principal place of employment, (iii) status (active or on leave, and if on leave, the nature of the leave and, if available, the expected return date; full-time or part-time), (iv) union status, (v) hire date (and service crediting date, if different), (vi) accrued vacation and/or paid time off, (vii) annual base salary or base wage rate, (viii) exemption status, (ix) target cash incentive compensation opportunity, and (x) target equity incentive compensation opportunity. No later than twenty (20) Business Days prior to the anticipated Closing Date, Seller shall deliver a revised version of such list which is updated as of the date of delivery and includes the name of each Business Employee. (b) Section 3.7(a3.15(b) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, each material Benefit Plan and separately identifies each material International Multiemployer Plan contributed to on behalf of any Business Employees (each such Multiemployer Plan. With , a “Represented Employee Multiemployer Plan” and any other Multiemployer Plan with respect to each material Benefit Plan (other than which Seller or any of its Affiliates has an International obligation to contribute, an “Other Multiemployer Plan), . Seller has made available to Purchaser correct the summary plan description relating to each such material Benefit Plan and complete copies has or will make available any other information within its possession regarding any Benefit Plans as reasonably required for Purchaser to comply with its obligations under Section 5.8, subject to applicable Law. (c) Each Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable determination or opinion letter from the IRS as to its qualification, and no circumstances exist that would reasonably be expected to result in any such letter being revoked. (ord) All contributions, premiums and payments required to be made by Law, by the extent no such copy existsterms of a Benefit Plan, a description of)on behalf of each Business Employee or any agreement relating thereto, the terms of any Collective Bargaining Agreement to any Represented Employee Multiemployer Plan (including any surcharges or premiums) since January 1, 2016 have been timely made in each caseall material respects. (e) Except as expressly contemplated by this Agreement, to neither the extent applicable, execution of this Agreement nor the consummation of the Transaction (whether alone or together with any other events) will (i) all plan documents, summary plan descriptions, summaries of result in any material modifications, and amendments related payment or benefit becoming due to such plans and any related trust agreementBusiness Employee, (ii) the most recent Form 5500 Annual Report, materially increase any compensation or benefits payable to any Business Employee or (iii) result in the most recent audited financial statement and actuarial valuation, acceleration of the time of payment or vesting or trigger any material payment or funding (ivthrough a grantor trust or otherwise) all material filings and correspondence with of any Governmental Entity and payments or benefits to any Business Employee. (vf) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (vSet forth on Section 3.15(f) of the immediately preceding sentence with respect to Seller Disclosure Schedules is a material International Plan within 30 days following true and correct list of each collective bargaining agreement, union contract, or other labor agreement covering Business Employees(each, a “Collective Bargaining Agreement”), which list is true and complete as of the date of this Agreement. Neither Seller nor any of its Affiliates is currently negotiating in connection with entering into any other Collective Bargaining Agreements. With respect to any Collective Bargaining Agreement set forth on Section 3.15(f) of the Seller Disclosure Schedules, no consent or consultation of, requirement to provide information to, or the rendering of, or receipt of an opinion or formal advice by, any labor or trade union, works council or other employee representative body or any Governmental Entity with jurisdiction over labor matters is required for Seller to enter into this Agreement or to consummate the Transaction. (bg) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred breached or is reasonably expected otherwise failed to incur comply with the provisions of any Controlled Group Liability that has not been satisfied in full. (d) Neither the SellerCollective Bargaining Agreement, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither and neither the execution and delivery of this Agreement nor the consummation of the Transactions (Transaction will, either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller event, result in any breach or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) other violation of the Code)any Collective Bargaining Agreement. (gh) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with none of the applicable statutes individuals listed or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) described on Section 3.7(h3.15(h) of the Seller Disclosure Letter Schedules has communicated to any union or to any Represented Employee that Purchaser (i) contains a true and complete list of each International Plan that provides for defined benefit will assume, adopt or termination indemnity benefits to Business Employees, and follow any Collective Bargaining Agreement; (ii) for which liabilities are recognized will hire all or substantially all of the individuals in the ordinary course bargaining unit; (iii) will offer initial terms and conditions of Selleremployment the same as or similar to those currently set forth in any Collective Bargaining Agreement or any other binding agreement with Seller or an Affiliate thereof regarding the compensation or benefits of Represented Employees; or (iv) has indicated a waiver of Purchaser’s financial reporting practice and, with respect right to each such plan, indicates the net balance sheet asset use an open hiring process to hire its workforce or liability its right to set initial terms and conditions of such plan as of the last day of Seller’s most recently completed fiscal yearemployment. (i) Since January 1, 2016, there have been no pending or, to the Knowledge of Seller, threatened (i) strikes, lockouts, slowdowns, work stoppages, or similar labor activity or disputes involving Business Employees, (ii) unfair labor practice charges or complaints filed with the National Labor Relations Board or any other Governmental Entity with respect to the Business or (iii) material grievances relating to the Business under any Collective Bargaining Agreement. (j) Since January 1, 2016, there have not been any union organizing drives, petitions, or efforts to organize any Business Employees by a union or other labor organization, including but not limited to any representation petitions filed with the National Labor Relations Board. (k) With respect to the Business Employees and Business Service ProvidersBusiness, Seller and its Subsidiaries are Affiliates are, and have been since April 3January 1, 2015 2016 in compliance in all material respects with all applicable Laws respecting with respect to employment and labor, employmentincluding but not limited to, immigrationLaws relating to wages, hours, overtime, collective bargaining, equal employment opportunities, fair employment practices, terms harassment, retaliation, hiring, promotion and conditions termination of employmentemployees, working conditions, leaves of absence, paid sick leave, classification of service providers, unemployment insurance, employment discrimination, safety and health, immigration status, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment collection and Retraining Notification Act payment of 1988withholding and employment Taxes (collectively, “Employment Laws”). Since January 1, 2016 there have been no material Proceedings relating to the Employment Laws pending or, to the Knowledge of Seller, threatened with respect to the Business before any arbitrator or Governmental Entity, including the U.S. Equal Employment Opportunity Commission or any similar state or local agency. Except as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party toAffiliates has any Liability for the misclassification of any Person as an independent contractor, temporary employee, leased employee or bound by, any Collective Bargaining Agreement. Except other service provider compensated other than through reportable wages (as has not been an employee) paid by Seller or its Affiliates. (l) Seller and would not reasonably be expected to be material to the Business, taken as a whole, its Affiliates (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made orBusiness) are, and have been since January 1, 2016, in material compliance with the WARN Act and have no material unsatisfied Liabilities thereunder with respect to the Seller’s KnowledgeBusiness. None of Seller or any of its Affiliates (with respect to the Business) has, threatened involving Business Employeeswithin the ninety (90) days prior to the date of this Agreement, closed any plant or facility, effectuated any mass layoffs of employees or implemented any early retirement, separation or similar program, in each case, in violation of the WARN Act, nor has Seller or any of its Affiliates (with respect to the Business) announced any such action or program for the future.

Appears in 1 contract

Samples: Stock and Asset Purchase Agreement (Kellogg Co)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.14(a) of the Seller Disclosure Letter Schedules sets forthforth a list, as of the date hereofof this Agreement, of each material Benefit Plan and separately identifies each material International Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of each such material Benefit Plan (or, to the extent that no such copy exists, a an accurate written description ofthereof), in each case, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, (ii) the most recent Form 5500 Annual Report, (iii) the most recent audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity and (v) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreement. (b) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto[Reserved]. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Benefit Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, qualified within the meaning of Section 401(a) of the Code has received a favorable determination letter as appropriate, based upon reasonable actuarial assumptionsto its qualification. (hd) No Benefit Plan is subject to Title IV of ERISA. None of Seller, the Purchased Companies or any of their ERISA Affiliates has maintained, established, participated in or contributed to, or is or has been obligated to contribute to, or has otherwise incurred any obligation or liability (including any contingent liability) under, any Multiemployer Plans within the last twelve (12) months. (e) Except as required by applicable Law, neither the execution of this Agreement nor the consummation of the Transactions (whether alone or together with any other events) will (i) result in any material payment that is the liability of the Business becoming due to any Business Employee, (ii) materially increase any benefits otherwise payable by the Business to any Business Employee or (iii) result in the acceleration of the time of payment or vesting of any such benefits. (f) Each Purchased Company Benefit Plan has been operated in compliance in all material respects with its terms and applicable Law. Except as would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, all contributions, premiums and expenses required to be made by Law or by the terms of a Purchased Company Benefit Plan or any agreement relating thereto have been timely made. (g) Set forth on Section 3.7(h3.14(g) of the Seller Disclosure Letter (i) contains Schedules is a true and complete list correct list, as of the date of this Agreement, of each International Plan that provides for defined benefit collective bargaining agreement of Seller or termination indemnity benefits any of its Affiliates to which any Transferred Business Employees are subject. During the two (2)-year period immediately prior to the date of this Agreement, there have been no strikes or lockouts involving Transferred Business Employees, and (ii) except for such strikes or lockouts the existence of which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (jh) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, neither Seller nor any Purchased Company is in violation with respect to any Transferred Business Employee of any Law governing the employment of Transferred Business Employees. (i) Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business, taken Business as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during is, and for the past two (2) years has been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation Business and the Transferred Business Employees, in compliance with all applicable federal and state Laws and regulations regarding labor and employment matters, including, but not limited to, fair employment practices, pay equity, restrictive covenants, the classification of independent contractors, workplace safety and health, work authorization and immigration, unemployment, workers’ compensation, affirmative action, terms and conditions of employment, employee accommodations and leaves of absence, expense reimbursements, and wages and hours, including payment of minimum wages and overtime and meal and rest break premiums, as well as payroll taxes and applicable federal and state deductions. Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business as a collective bargaining unit presently being whole, the Seller is not, with respect to the Business and the Transferred Business Employees, delinquent in any payments to any Transferred Business Employee or consultant for any wages, salaries, commissions, bonuses, fees or other direct compensation due with respect to any services performed for it or amounts required to be reimbursed to such Transferred Business Employees or consultants. Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business as a whole, the Seller is not liable for any payment to any trust or other fund or to any Governmental Entity with respect to unemployment compensation benefits, social security or other benefits or obligations for employees (other than routine payments to be made orin the ordinary course of business consistent with past practice). Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business as a whole, there are no pending claims against the Seller, with respect to the Business and the Transferred Business Employees, either under any workers’ compensation plan or policy or for long-term disability. The Seller has retained all material employment records of Transferred Business Employees in accordance with applicable federal and state Laws. (j) Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business as a whole, except as set forth on Section 3.14(j) of the Seller Disclosure Schedules: (i) there are no, and during the last two (2) years there have been no actions, lawsuits, claims, investigations, formal or informal grievances, arbitration claims, complaints, administrative charges or other legal proceedings against the Seller, with respect to the Business or any Transferred Business Employees, pending, or to the Seller’s Knowledge, threatened involving to be brought or filed, by or with any judicial, regulatory or administrative forum, under any private dispute resolution procedure or internally in connection with employment or labor matters, including, without limitation, any claim relating to unfair labor practices, employment discrimination, harassment, retaliation, wage and hour, equal pay or any other employment related matter arising under applicable federal and state Laws, in each case, other than any closed formal or informal grievances. (ii) none of the employment policies or practices of the Seller are as of the date hereof being audited or investigated by any Governmental Entity. (iii) neither the Seller, nor any of its officers is, or within the last two (2) years has been, subject to any order, decree, injunction or judgment by any Governmental Entity or private settlement contract in respect of any labor or employment matters with respect to the Business or any Transferred Business Employees. (k) Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business as a whole, the Seller has a complete and accurate copy of U.S. Citizenship and Immigration Services Form I-9 for each of the Transferred Business Employees and the Business is not subject to any affirmative action obligations under any Law, including, without limitation, Executive Order 11246, and no Purchased Company is a government contractor or subcontractor for purposes of any law with respect to the terms and conditions of employment, including, without limitation, the Service Contracts Act or prevailing wage Laws. (l) During the ninety (90) day period preceding the date hereof, no employee of Seller and its Subsidiaries has suffered an “employment loss” as defined in the WARN Act with respect to the Seller. (m) Notwithstanding anything in this Agreement to the contrary, this Section 3.14 sets forth the sole and exclusive representations and warranties relating to labor matters.

Appears in 1 contract

Samples: Purchase and Sale Agreement (Chemours Co)

Labor Relations; Employees and Employee Benefit Plans. (a) On the date hereof, Seller has delivered to Purchaser a true and complete anonymized list of each Business Employee as of the date hereof setting forth each such Business Employee’s (i) title/position, (ii) principal place of employment, (iii) status (active or on leave; full-time or part-time), (iv) hire date (and service crediting date, if different), (v) accrued vacation and/or paid time off, (vi) annual base salary or base wage rate, (vii) target cash incentive compensation opportunity, (viii) union status and (ix) for Business Employees located in the United States, exempt and non-exempt classification, and (x) to the extent not previously provided, any other information required under the ARD. No later than five (5) Business Days prior to the anticipated Closing Date, Seller shall deliver a revised version of the Business Employee list which is updated as of the date of delivery and includes the name of each Business Employee and any updates to the extent in compliance with Section 3.7(a5.2. (b) Section 3.13(b) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, all Assumed Benefit Plans and each other material Benefit Plan and separately identifies each material International Plan. With respect to each such Assumed Benefit Plan and material Benefit Plan (other than an International Plan), as the case may be, Seller has made available to Purchaser correct such documents and complete copies of (orinformation requested by Purchaser that is reasonably necessary for Purchaser to fulfill its obligations under Section 5.7. In addition, with respect to the extent no such copy existseach Assumed Benefit Plan, a description of)Seller has made available to Purchaser, in each case, to the extent as applicable, the summary plan description (i) or a written summary if there is no summary plan description),a copy of the most recent determination or opinion letter issued by the IRS, all documents and records pursuant to which such Assumed Benefit Plan is maintained, administered and funded (including, without limitation, the plan documents, summary plan descriptionsfunding vehicles, summaries of participant and financial records, filings and material modificationscorrespondence with Governmental Entities, and amendments related to such plans and any related trust agreement, (ii) the most recent Form 5500 Annual Report, (iii) the most recent audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity and (v) all material related service provider agreements, insurance contracts and other agreements which implement each such Benefit Plan). Seller will make available to Purchaser each item in clauses (i) through (vThe defined contribution UK Pension Scheme set forth on Section 3.13(b) of the immediately preceding sentence with respect to a material International Plan within 30 days following Seller Disclosure Schedules is the date of this Agreement. (b) Except as has not had and would not reasonably be expected to have, individually or in only arrangement under which the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant any Seller Entity has or may have any obligation to each Assumed International Plan provide or contribute towards pension, lump-sum, death, ill-health, disability or accident benefits in respect of current or prior plan years have been timely paid or accrued any Business Employee in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related theretoUnited Kingdom. (c) No liability under Title IV Except as set forth on Section 3.13(c) of ERISA has been incurred by the Seller or its Subsidiaries or any Disclosure Schedules, no Benefit Plan is (i) a defined benefit plan (as defined in Section 3(35) of their respective ERISA Affiliates that has not been satisfied ERISA), (ii) an “employee pension benefit plan” (as defined in full, and to Seller’s Knowledge no condition exists Section 3(2) of ERISA) that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 412 or 430 or 4971 of the Code, (iii) a “multiple employer plan” (within the meaning of Section 413(c) of the Code, and (iv) a “multiple employer welfare arrangement” (as defined in Section 3(40) of ERISA,. None There are no accrued benefits, commitments, or financial liabilities with respect to any employee benefit plan of Sellerthe types described in (i) through (iv) above, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or any defined benefit pension plan or plan providing post-employment health, life or other welfare benefits in a jurisdiction outside the United States, that shall transfer to, or otherwise become a liability of, Purchaser as a result of the consummation of the transactions contemplated by this Agreement, whether pursuant to an active, frozen, partially frozen, discontinued, or terminated plan of any Seller Entity or its Affiliates. Neither Seller nor any of its ERISA Affiliates contributes to, has an obligation to contribute to or otherwise has any liability (actual or contingent) with respect to any Assumed Benefit Plan that has two is a Multiemployer Plan for the benefit of any Business Employee. (2d) or more contributing sponsors, at least two (2) of whom are not under “common control” (Each Benefit Plan that is intended to be tax-qualified within the meaning of Section 4063 401(a) of ERISA)the Code has received a favorable determination or opinion letter from the IRS as to its qualification and no circumstances exist that could reasonably be expected to result in the revocation of such letter or to adversely affect such plan’s tax-qualified status. (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated Except as required by the Consolidated Omnibus Budget Reconciliation Act of 1985applicable Law, as amendedexpressly contemplated by this Agreement or as set forth on Section 3.13(e) of the Seller Disclosure Schedules, or comparable U.S. state Law. (f) Neither neither the execution and delivery of this Agreement nor the consummation of the Transactions Transaction (either whether alone or in conjunction together with any other eventevents) will, except as required by the terms of this Agreement, will (i) result in any material payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwiseEmployee, (ii) materially increase any benefits otherwise payable by the Business to any Business Employee under any Benefit PlanEmployee, or (iii) result in any the acceleration of the time of payment, funding payment or vesting of any material payments or benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries due to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code)Employee. (gf) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Set forth on Section 3.7(h3.13(f) of the Seller Disclosure Letter Schedules is a true and correct list of each collective bargaining or works council or other labor agreement of Seller or any of its Affiliates to which any Business Employees are subject (each, a “Collective Bargaining Agreement”), which list is true and complete as of the date of this Agreement. During the two (2)-year period immediately prior to the date of this Agreement, there have been no (i) contains a true and complete list of each International Plan that provides for defined benefit strikes, lockouts, work stoppages, slowdowns, picketing or termination indemnity benefits to Business Employeesother material concerted action or labor dispute, and or (ii) organizational efforts or demands for which liabilities are recognized recognition, in the ordinary course of Seller’s financial reporting practice andeach case, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the involving Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions except for such strikes or lockouts the existence of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and which would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (jg) Seller has provided During the three (3)-year period immediately prior to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof)this Agreement, Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date and is in material compliance with all applicable Laws respecting employment and employment practices in respect of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party including but not limited to, or bound byterms and conditions of employment, any Collective Bargaining Agreement. Except as has not been collective bargaining, immigration (including verifying eligibility to work in the applicable jurisdiction), health and would not reasonably be expected to be material to safety, wages and hours (including the Businessproper classification of employees and of independent contractors), taken as a wholebenefits, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor disputeharassment, strike or work stoppage non-discrimination in employment and workers’ compensation, and (ii) there are have been no organizational efforts material Proceedings filed against Seller by any current or former Business Employee with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employeestheir employment.

Appears in 1 contract

Samples: Asset Purchase Agreement (Morningstar, Inc.)

Labor Relations; Employees and Employee Benefit Plans. (a) As of the date hereof, Seller has delivered to Purchaser a true and complete anonymized list of each Business Employee employed by Seller or any of its Affiliates as of the date hereof setting forth, to the extent permitted by applicable Data Protection Legislation, each such Business Employee’s (i) title/position, (ii) principal place of employment, (iii) status (active or on leave; full-time or part-time), (iv) hire date, (v) annual base salary or base wage rate, and (vi) target cash incentive compensation opportunity for 2022. No later than two (2) Business Days prior to the anticipated Closing Date, Seller shall deliver a revised version of such list which includes the name of each Business Employee employed by Seller or any of its Affiliates as of such date. 52 (b) Section 3.7(a3.14(b) of the Seller Disclosure Letter Schedules sets forth, forth a list of each material Benefit Plan as of the date hereofof this Agreement. With respect to each such material Benefit Plan, each Seller has made available, or will make available as soon as reasonably practicable, to Purchaser (as applicable) the plan document embodying such material Benefit Plan and separately identifies each material International Plan. With all amendments thereto (or, with respect to each material Benefit Plan (other than that is not an International Assumed Plan, a summary of the terms thereof). With respect to each Assumed Plan, Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each case, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, the most recent annual report and amendments related to such plans and any related trust agreementaccompanying schedules, (ii) the most recent Form 5500 Annual Reportsummary plan description and any summaries of material modifications relating to such Assumed Plan, (iii) the most recent audited financial statement and actuarial valuationdetermination or opinion letter received from the U.S. Internal Revenue Service (“IRS”) regarding the tax-qualified status of such Assumed Plan, (iv) the most recent written results of all material filings and correspondence with any Governmental Entity required compliance testing and (v) all copies of any material related agreementscorrespondence with the IRS, insurance contracts U.S. Department of Labor or other Governmental Entity. (c) Each Assumed Plan has been established, operated and other agreements which implement funded in material compliance with applicable Law and the terms of such Assumed Plan, in each such Benefit Plancase, as it relates to the Business Employees. Seller will make available to Purchaser each item in clauses (i) through (v) As of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreement. (b) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pendingmaterial Proceedings pending or, or to the Knowledge of Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits in writing involving any Assumed Plan to the extent they relate to any Business Employees (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto). (cd) No liability With respect to each Assumed Plan that is intended to qualify under Title IV Section 401(a) of the Code, such plan, and its related trust, has at all times since its adoption been so qualified and has received a current determination letter (or is the subject of a current opinion letter in the case of any prototype plan) from the IRS on which Seller and its Affiliates can rely that it is so qualified and that its trust is exempt from tax under Section 501(a) of the Code, and nothing has occurred with respect to the operation of any such plan which could cause the loss of such qualification or exemption or the imposition of any material liability, penalty or tax under ERISA has been incurred by or the Code. (e) In respect of Benefit Plans subject to the Laws of the United States, no Assumed Plan is, and none of Seller or any of its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has have ever sponsored, maintained established, maintained, contributed to, or incurred been required to contribute to, or in any Liability way has any liability (whether on account of an ERISA Affiliate or otherwise), directly or indirectly, with respect to an employee benefit to, any plan that is, (i) subject to Title IV or Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None Code or a “defined benefit” plan within the meaning of SellerSection 414(j) of the Code or Section 3(35) of ERISA (whether or not subject thereto), its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (dii) Neither the Sellera Multiemployer Plan, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6iii) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, sponsors at least two (2) of whom are not under common control” (, within the meaning of Section 4063 of ERISA). , (eiv) No Benefit Plan provides benefits, including death or medical benefits a “multiple employer welfare arrangement” (whether or not insuredas defined in Section 3(40) of ERISA), or (v) a plan maintained in connection with respect to current any trust described in Section 501(c)(9) of the Code. None of Seller or former Business Employees beyond their retirement or other termination any of service, other than coverage mandated by its Subsidiaries has withdrawn at any time within the Consolidated Omnibus Budget Reconciliation Act of 1985, as amendedpreceding six (6) years from any Multiemployer Plan, or comparable U.S. state Lawincurred any withdrawal liability which remains unsatisfied, and no events have occurred and no circumstances exist that could reasonably be expected to result in any such Liability to Seller or any of its Subsidiaries. (f) Neither No Assumed Plan provides for any post-employment or post-retirement health or welfare benefits to any Business Employee (or dependents or beneficiaries thereof), except as otherwise required by Section 4980B of the Code or any other applicable Law, or where the cost of such benefit is borne by the Business Employee. (g) Except as required by applicable Law or as expressly contemplated by this Agreement, neither the execution and delivery of this Agreement nor the consummation of the Transactions (either whether alone or in conjunction together with any other eventevents) will, except as required by the terms of this Agreement, will (i) result in any payment (including severance and unemployment compensationbecoming due, forgiveness or increase the amount of indebtedness any compensation or otherwise) becoming due benefits due, to any Business Employee from Seller or its Subsidiaries under with respect to any Benefit Plan or otherwiseAssumed Plan, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan53 Employee, (iii) result in any the acceleration of the time of payment, funding payment or vesting of any payments or benefits under due to, or the forgiveness of indebtedness of, any Benefit Plan Business Employee or (iv) result in an obligation to fund or otherwise set aside assets to secure to any payment extent any of the obligations under any Assumed Plan. (whether h) Set forth in cash Section 3.14(h) of the Seller Disclosure Schedules is a true and complete list of each collective bargaining or property other material written labor agreement with any labor union, works council or other collective employee representative group or body to which any Business Employee is subject (excluding any such agreements that apply at a national or industry-wide level) (each, a “Collective Bargaining Agreement”), which list is true and complete as of the date of this Agreement. Since January 1, 2020, (i) there have been no strikes, lockouts, concerted slowdowns, work stoppages, unfair labor practice charges, material labor arbitrations, or other material labor dispute, disruption or controversy in effect or, to the Knowledge of Seller, threatened, by or against Business Employees and (ii) to the Knowledge of Seller, no campaigns or proceedings have been conducted to authorize union, works council or other collective representative of any Business Employees. Except as set forth in Section 3.14(h) of the Seller Disclosure Schedules, the consent or consultation of, or the vesting rendering of property) from formal advice by, any labor union, works council, or other collective employee representative group or body is not required by applicable Law or any agreement for Seller or any of its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually enter into this Agreement or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of to consummate the Code)Transactions. (gi) Except as Since January 1, 2020, there has not had and been no Proceeding by or on behalf of any Business Employee or any labor union, works council, or other collective employee representative group or body representing same, or otherwise arising from Seller’s or any of its Subsidiaries’ labor or employment policies or practices in respect of the Business Employees, pending or, to the Knowledge of Seller, threatened which, if adversely decided, would not reasonably be expected to havebe, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, material to the extent relevantGES Business, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, taken as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call paywhole. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect to the Business Employees, neither Neither Seller nor any of its Subsidiaries is a party to, or otherwise bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected consent decree with, or citation by, any Governmental Entity relating to be material Seller’s or its Subsidiaries’ employment practices in respect of the Business Employees. (j) Since January 1, 2020, with respect to the Business Employees, Seller and its Affiliates have been in material compliance with all applicable Laws relating to employment, employment practices, compensation, benefits, hours, terms and conditions of employment, and the termination of employment, including any obligations pursuant to the Worker Adjustment and Retraining Notification Act of 1988 (or similar Laws) or relating to the classification of employees as exempt or non-exempt from overtime pay requirements, labor relations and collective bargaining, employee information and consultation obligations, the provision of meal and rest breaks, pay for all working time, leaves of absence, immigration and work authorization, equal employment opportunities (including the prevention of discrimination, harassment, and retaliation), equal pay, occupational safety and health, the use of non-employee contractors, and the proper classification of individuals as non-employee contractors or consultants. (k) Since January 1, 2020, with respect to the GES Business, taken as neither Seller nor any of its Affiliates has closed any site of employment, effectuated any material group layoffs of employees or implemented any material early retirement, exit incentive, or other group separation program, sufficient to trigger application of the Worker Adjustment and Retraining Notification Act of 1988 (or similar Laws), nor has Seller or any of its Subsidiaries planned or announced any such action or program for the future relating to the Business Employees. (l) Since January 1, 2020, no employee or former employee of the GES Business with a wholejob title of Executive Director or Vice President or above has been the subject of a pending or, (i) neither to the Knowledge of Seller, threatened, allegation of sexual harassment or sexual assault in connection with his or her employment with Seller or its Subsidiaries. Neither Seller nor any of its Subsidiaries is (has, since January 1, 2020, entered into any settlement agreement with a Business Employee involving allegations of sexual harassment or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employeessexual misconduct.

Appears in 1 contract

Samples: Securities and Asset Purchase Agreement (S&P Global Inc.)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.10(a) of the Seller Disclosure Letter sets forthSchedule identifies each material Seller Benefit Plan and each Transferred Benefit Plan, including each material Delayed Employee Transferred Benefit Plan, as of the date hereof, each material Benefit Plan of this Agreement and separately identifies each material International Transferred Benefit Plan and material Delayed Employee Transferred Benefit Plan. With Seller has made available to Buyer correct and complete copies of each such material Seller Benefit Plan and each such Transferred Benefit Plan (or, to the extent that no such copy exists, an accurate written description thereof). In addition, with respect to each material Transferred Benefit Plan (other than an and each International Pension Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each caseBuyer, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, agreement or other funding instrument; (ii) the most recent Form 5500 Annual Reportcurrent summary plan description and any material modifications thereto, if any; and (iii) if applicable, the most recent (A) audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity statements and (vB) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreementactuarial valuation reports. (b) Section 3.10(b) of the Seller Disclosure Schedule identifies each Benefit Plan that is intended to be qualified under Section 401(a) of the Code (each, a “Qualified Plan”). Each Qualified Plan has received a favorable determination letter or opinion letter as to its qualification and, to the Knowledge of Seller, no fact or event has occurred since the date of such letter or letters that would reasonably be expected to result in the revocation of such letter or adversely affect the qualified status of such Benefit Plan or the related trust. (c) Each Transferred Benefit Plan and International Pension Plan has been operated in material compliance with its terms and applicable Law. Except as has not had and would not reasonably be expected to haveresult in, individually or in the aggregate, a Business Material Adverse Effectmaterial Liability to the TMA Business, all (i) each Assumed contributions, premiums and expenses required to be made by Law or by the terms of a Transferred Benefit Plan or International Pension Plan has or any agreement relating thereto have been operated and administered timely made or are accrued in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunderAccounting Principles, (ii) all contributions premiums due or other amounts payable by Seller with respect to insurance policies funding any Transferred Benefit Plan or its Subsidiaries pursuant to each Assumed International Pension Plan in respect of current or prior plan years for any period through the date hereof have been timely made or paid in full or, to the extent not required to be made or paid on or before the date hereof, accrued in accordance with GAAP or applicable international accounting standardsthe Accounting Principles, and (iii) as with respect to each Benefit Plan in which the assets of such Benefit Plan does not equal or exceed the date hereofLiabilities of such Benefit Plan, there are no pendingincluding any accrued vacation, sick leave, personal time or to Seller’s Knowledgepension benefits, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of such Benefit Plan is accrued in accordance with the CodeAccounting Principles. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is Except as would not reasonably be expected to incur result in, individually or in the aggregate, material Liability to the TMA Business, the records and accounts in respect of any Controlled Group Liability that has not Transferred Benefit Plan have been satisfied kept in fullaccordance with applicable Law. (d) Neither No Seller Benefit Plan or Transferred Benefit Plan is subject to Title IV of ERISA, Section 412 of the SellerCode, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any a Multiemployer Plan or a plan that has two (2) or more contributing sponsors, sponsors at least two (2) of whom are not under common control” (control within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits. There does not now exist, including death or medical benefits (whether or not insured)nor do any circumstances exist that could result in, with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is Controlled Group Liability that would be a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or material liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller Buyer or any of its Subsidiaries who was primarily dedicated to following the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the BusinessClosing. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employees.

Appears in 1 contract

Samples: Asset Purchase Agreement (Teradata Corp /De/)

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Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth, as forth a true and complete list of the date hereof, each material Benefit Plan and separately identifies each material International Plan. With Purchased Company Benefit Plan and with respect to each material such Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each casePurchaser, to the extent applicable, (i) a correct and complete copy of each such plan (or a description, if such plan is not written) and all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreementthereto, (ii) the most recent Form 5500 Annual Reportany related trust agreement or other funding instrument and amendments thereto, (iii) the most recent audited financial statement and actuarial valuationIRS determination letter or opinion letter, (iv) the current prospectus or summary plan description and all summaries of material filings and correspondence with any Governmental Entity and modifications, (v) the most recent (A) Form 5500 and attached schedules and (B) actuarial valuation report, (vi) all material related agreementsdocuments and correspondence relating thereto received from or provided to the IRS, insurance contracts the U.S. Department of Labor, the PBGC or any other Governmental Entity or the plan sponsor of any Multiemployer Plan during the past year, and other agreements which implement each (vii) if such plan is an International Benefit Plan. Seller will make available , documents that are substantially comparable (taking into account differences in applicable Law and practices) to Purchaser each item the documents required to be provided in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreementvi). (b) (i) Each Benefit Plan that is intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable determination or opinion letter from the IRS as to its qualification, or has applied to the IRS for such a letter within the applicable remedial amendment period or such period has not expired and no circumstances exist that could reasonably be expected to result in any such letter being revoked or not being issued or reissued or a penalty under the IRS Closing Agreement Program if discovered during an IRS audit or investigation, (ii) each trust created under any such Benefit Plan is exempt from Tax under Section 501(a) of the Code and has been so exempt since its creation and (iii) no events have occurred with respect to any Benefit Plan that could result in payment or assessment by or against Purchaser of any material excise tax, fine, Lien, penalty or Liability under ERISA, the Code or other applicable Law. (c) Each Benefit Plan has been maintained, funded and operated in material compliance with its terms and applicable Law. All returns, reports and disclosure statements required to be made under applicable Law with respect to all Benefit Plans have been timely filed or delivered in all material respects. Neither Seller nor, to the Knowledge of Seller, any of its directors, officers, employees, agents, plan fiduciaries, plan trustees or plan administrators of any Benefit Plan or trust created under any Benefit Plan, has engaged in or been a party to any non-exempt “prohibited transaction” as defined in Section 4975 of the Code and Section 406 of ERISA that has not been corrected. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse EffectEffect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, all contributions, premiums and payments required to be made by Law or by the terms of a Benefit Plan or any agreement relating thereto have been timely made in all material respects, and all contributions, premiums and payments for any period before the Closing Date that are not due are in all material respects properly accrued to the extent required to be accrued under applicable accounting principles and have been properly reflected in all material respects on the Business Balance Sheet or disclosed in the notes thereto. For purposes of this Section 3.15(c), “Benefit Plan” shall not include any Collective Bargaining Agreement. (d) Except as set forth on Section 3.15(d) of the Seller Disclosure Schedules, (i) each Assumed International no Benefit Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, is (iiA) all contributions or other amounts payable by Seller or its Subsidiaries pursuant a plan subject to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries Section 412 of the Code; or (B) a Multiemployer Plan and (ii) following the Closing Date, neither Purchaser nor any Purchased Company will have, or be reasonably expected to have, any direct or indirect liability or contingent liability solely due to entering into this Agreement or the completion of their respective the Transaction with respect to, (A) any plan subject to Title IV of ERISA Affiliates that has not been satisfied or Section 412 of the Code or (B) a Multiemployer Plan. With respect to any Multiemployer Plan in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller which a Business Employee participates in connection with his or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within her employment with the last six (6) yearsBusiness, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred received notice and Seller has no Knowledge of any such Multiemployer Plan’s (i) failure to satisfy the minimum funding requirements of Section 412 of the Code or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. application for or receipt of a waiver of such minimum funding requirements, (dii) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to “endangered status” or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under common controlcritical status” (within the meaning of Section 4063 432 of the Code) or (iii) insolvency, “reorganization” (within the meaning of Section 4241 of ERISA)) or proposed or threatened termination. All contributions, surcharges and premium payments owed by Seller, any Purchased Subsidiary and their respective ERISA Affiliates with respect to each such Multiemployer Plan have been paid when due in all material respects. (e) No Except as set forth in Section 3.15(e) of the Seller Disclosure Schedules, none of Seller or any of its Subsidiaries has any material current or projected Liability for, and no Benefit Plan provides benefitsor promises, including death any material post-employment or medical post-retirement medical, dental, disability, hospitalization, life or similar benefits (whether insured or not self-insured), with respect ) to any current or former Business Employees beyond their retirement or other termination of serviceEmployee, including such benefits as required by a Collective Bargaining Agreement (other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985applicable Law, as amended, or comparable U.S. state Lawincluding COBRA). (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable to any Business Employee under any Benefit Plan, (iii) result in any acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse EffectEffect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, each Assumed International Plan (i) has been operated in conformance with the applicable statutes other than claims by Business Employees or governmental regulations and rulings relating to such plans their beneficiaries for benefits received in the jurisdictions in which such Assumed International Plan ordinary course of business consistent with past practice under a Benefit Plan, no Action is present or operates andpending against, involves, or, to the extent relevantKnowledge of Seller, is threatened against or is threatened to involve any Benefit Plan before any arbitrator or Governmental Entity, including the IRS, the United StatesU.S. Department of Labor or the PBGC (or similar non-U.S. Governmental Entity) and there has been no such Action in the past three (3) years. For purposes of this Section 3.15(f), “Benefit Plan” shall not include any Multiemployer Plan. (iig) that is intended Neither Seller nor any of its Subsidiaries has any obligation to qualify gross up, indemnify or otherwise reimburse any current or former Business Employee for special tax treatment meets all requirements for any Tax incurred by such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reservedBusiness Employee, as appropriateincluding under Section 409A, based upon reasonable actuarial assumptions457A or 4999 of the Code. (h) Except as would not reasonably be expected to, individually or in the aggregate, result in material Liability for the Business, Purchaser or any Purchased Company, each Benefit Plan, and any award thereunder, that is or forms part of a “nonqualified deferred compensation plan” within the meaning of Sections 409A or 457A of the Code has been timely amended (if applicable) to comply and is and in the past three (3) years has been operated in compliance with all applicable requirements of Sections 409A and 457A of the Code. (i) Except as set forth in Section 3.7(h3.15(i) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit Schedules or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse EffectEffect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, each International Benefit Plan (A) is and in the past three (3) years has been maintained and administered in compliance with its terms, including, for the avoidance of doubt, the terms of any Collective Bargaining Agreement, and all applicable Laws, (B) if intended to qualify for special Tax treatment, meets all the requirements for such treatment, and (C) if required, to any extent, to be funded, book-reserved or secured by an insurance policy of Seller, a Purchased Subsidiary or any of their respective Affiliates, is funded, book-reserved or secured by an insurance policy, as applicable, based on reasonable actuarial assumptions in accordance with applicable accounting principles. (j) Except as would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, no International Benefit Plan has provided been declared to Purchaser be fully or partially wound up, nor has any act or event occurred pursuant to which any International Benefit Plan could be ordered to be wound up, in whole or in part, by any Governmental Entity. (k) Except as would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, no event has occurred that would subject Seller or any Purchased Company to the imposition of any material penalty or Liability with respect to the administration of any International Benefit Plan. (l) Except as required by applicable Law or as set forth on Section 3.15(l) of the Seller Disclosure Schedules, neither the execution of this Agreement nor the consummation of the Transaction (whether alone or together with any other events) will (i) entitle any current or former Business Employee to any payment or benefit, including any material bonus, retention, severance, retirement or job security payment or benefit, (ii) accelerate the time of payment or vesting or trigger any payment or funding (through a grantor trust or otherwise) of material compensation or benefits under, or materially increase the amount payable or trigger any other obligation under, any Benefit Plan, (iii) result in the payment of any amount that would not be deductible under Section 280G of the Code or (iv) limit or restrict any right to merge, materially amend or terminate any Purchased Company Benefit Plan or with respect to the Transferred Business Employees, any Assumed Benefit Plan (subject to appropriate notification to the insurer or administrator, and to the payment of benefits due as of, or claims incurred prior to, the merger, amendment or termination of such Benefit Plan). (m) Section 3.15(m) of the Seller Disclosure Schedules contains a true and complete and accurate list of each the following information in respect of Business Employee Employees, as of the date hereof that is no more than thirty (such list, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, 30) days prior to the extent permitted by applicable Lawdate of this Agreement: (i) title or positionsubject to applicable Law, title, hire date and location; (ii) original date of hire whether full- or original commencement of servicepart-time; (iii) whether full-time active or part-timeon leave (and, whether hourly or salaried if on leave, the nature of the leave and, if available, the expected return date); and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired whether exempt from the U.S. Fair Labor Standards Act. (n) Except as would not reasonably be expected to have, individually or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence aggregate, a Business Material Adverse Effect and would not reasonably be expected to impair or materially delay the ability of Seller to (x) perform its obligations under this Agreement or (y) consummate the Transaction and the other transactions contemplated hereby, (i) Seller and its Subsidiaries (with respect to each Business Service Provider (the Business) and the Purchased Companies are, and have been in the case past three (3) years, in compliance with all applicable Laws relating to labor and employment, including those relating to labor-management relations, wages, hours, overtime, classification of clause (vi) employees as exempt from overtime pay requirements, classification of non-employee contractors, discrimination, sexual harassment, civil rights, affirmative action, work authorization, immigration, occupational safety and health, information privacy and security, workers’ compensation, continuation coverage under group health plans, wage payment and the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments)payment and withholding of Taxes, and which update shall (Aii) identify whether each individual on in the Service Provider List is an employee of Seller or one of its Subsidiariespast three (3) years, a Business Service Provider who provides services there have been no Actions pending or, to the Business through an individual contract Knowledge of Seller, threatened with respect to the Business, the Purchased Assets, the Assumed Liabilities or a Business Service Provider who provides services to Business through a third party agencyagainst the Purchased Companies before any Governmental Entity, (B) provide including the name of each Business Employee and Business Service ProviderU.S. Equal Employment Opportunity Commission or any similar state, (C) provide the target bonus, and other cash incentive compensation for such Business Employee local or Business Service Provider foreign agency responsible for the prior twelve (12)-month period administration and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active enforcement of employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work locationLaws. (ko) Every Business Employee as of the date hereof has been primarily dedicated Seller and its Subsidiaries (with respect to the Business since December 31Business) and the Purchased Entities are, 2018 and have been in the past three (or3) years, for any such Business Employee hired after December 31, 2018, since in material compliance with the date of such Business Employee’s hire)WARN Act and have no material unsatisfied Liabilities thereunder. Since December 31, 2018, no employee None of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With with respect to the Business EmployeesBusiness) or any Purchased Subsidiary has, neither within the ninety (90) days prior to the date of this Agreement, closed any plant or facility, effectuated any mass layoffs of employees or implemented any early retirement, separation or similar program, in each case, in violation of the WARN Act, nor has Seller nor or any of its Subsidiaries (with respect to the Business) or any Purchased Subsidiary announced any such action or program for the future, or taken any other action that would reasonably be expected to cause Purchaser or any Purchased Subsidiary to have any material Liability or other obligation following the Closing Date under the WARN Act. (p) Set forth on Section 3.15(p) of the Seller Disclosure Schedules is a party totrue and complete list, or bound byas of the date of this Agreement, any of each Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (iset forth on Section 3.15(p) neither of the Seller nor Disclosure Schedules, none of Seller or any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation Business), any Purchased Subsidiary or any of their respective Subsidiaries is a party to or bound by, or is currently negotiating in connection with entering into, any Collective Bargaining Agreement, and, to the Knowledge of Seller, there has not been any organizational campaign or petition or other unionization activity seeking recognition of a collective bargaining unit presently being made relating to any Business Employee. Except as set forth on Section 3.15(p) of the Seller Disclosure Schedules, none of Seller or any of its Subsidiaries (with respect to the Business), the Purchased Subsidiaries or any of their respective Affiliates has failed to comply in any material respect with the provisions of any Collective Bargaining Agreement, and there are no material grievances outstanding relating to the Business under any such agreement. There are no material unfair labor practice complaints pending or threatened with respect to the Business or the Purchased Companies before the U.S. National Labor Relations Board or any other Governmental Entity. There are no, and in the past three (3) years there have been no, strikes, labor disputes, work stoppages, picketings or lockouts pending or, to the Knowledge of Seller’s Knowledge, threatened involving Business Employees. (q) With respect to any Collective Bargaining Agreement set forth on Section 3.15(p) of the Seller Disclosure Schedules, no consent or consultation of, requirement to provide information to, or the rendering of, or receipt of an opinion or formal advice by, any labor or trade union, works council or other employee representative body or any Governmental Entity with jurisdiction over labor matters is required for any Seller Entity to enter into this Agreement or to consummate the Transaction.

Appears in 1 contract

Samples: Stock and Asset Purchase Agreement (Johnson Controls International PLC)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.14(a) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, each material Benefit Plan and separately identifies each material International Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of each such material Benefit Plan (or, to the extent no such copy exists, a an accurate written description ofthereof), in each case, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, (ii) the most recent Form 5500 Annual Report, (iii) the most recent audited financial statement and actuarial valuation, (iv) all material filings and correspondence with any Governmental Entity and (v) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreement. (b) Except Each Benefit Plan from which rollover contributions are contemplated under Section 5.6 that is intended to be qualified within the meaning of Section 401(a) of the Code, has been operated in material compliance with its terms and applicable Law, has received a favorable determination or opinion letter as to its qualification and, to the Knowledge of Seller, nothing has not had and occurred that would not reasonably be expected to have, individually give rise to a revocation of such determination or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related theretoopinion. (c) No liability under Title IV Except as required by applicable Law or as set forth on Section 3.14(c) of ERISA has been incurred by the Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) yearsDisclosure Schedules, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions Transaction (either whether alone or in conjunction together with any other eventevents) will, except as required by the terms of this Agreement, will (i) result in any material payment (including severance other than any payment for which Seller and unemployment compensation, forgiveness of indebtedness or otherwiseits Affiliates are exclusively liable) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwiseEmployee, (ii) materially increase any benefits otherwise payable to any Business Employee under (other than any Benefit Plan, increases for which Seller and its Affiliates are exclusively liable) or (iii) result in any the acceleration of the time of payment, funding payment or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code)benefits. (gd) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Set forth on Section 3.7(h3.14(d) of the Seller Disclosure Letter Schedules is a true and correct list, as of the date of this Agreement, of each collective bargaining, works council or other material labor agreement of Seller or any of its Affiliates which covers any portion of the Business and/or to which any Business Employees are subject. Except as set forth on Section 3.14(d) of the Seller Disclosure Schedules, no Business Employee is represented by a labor union, works council or other labor organization with respect, in whole or in part, to the Business. There are not currently, and during the three (3)-year period immediately prior to the date of this Agreement, there have not been, any pending or, to the Knowledge of Seller, threatened strikes, work slowdowns, work stoppages, picketing or lockouts involving Business Employees (with respect, in whole or in part, to the Business). To the Knowledge of Seller, no petition has been filed or proceedings instituted by a Business Employee or group of Business Employees with any labor relations board seeking recognition of a bargaining representative with respect, in whole or in part, to the Business. To the Knowledge of Seller, with respect, in whole or in part, to the Business, there is no organizational effort currently being made or threatened by, or on behalf of, any labor union, works council or other labor organization to organize any Business Employees and no demand for recognition of any Business Employee has been made by, or on behalf of, any labor union, works council or other labor organization. There are no material unfair labor practice complaints pending against Seller or any of its Subsidiaries in respect of any Business Employee and/or the Business before the National Labor Relations Board or any other labor relations tribunal or authority. For purposes of this Section 3.14(d), the defined term “Business Employee” shall include any former employee of Seller or any of its Affiliates who was actively and primarily employed in the Business. (e) Seller has made available to Purchaser a true and correct list of each current Business Employee and, for each such Business Employee such Business Employee’s (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employeesjob title, and (ii) for which liabilities are recognized in work location, (iii) first date of service (with the ordinary course Seller, any of Seller’s financial reporting practice andits Affiliates or a predecessor employer), with respect to each such plan(iv) status as exempt or non-exempt (if a U.S. Business Employee), indicates the net balance sheet asset (v) visa status, (vi) base salary or liability of such plan as of the last day of Seller’s most recently completed fiscal yearbase wage rate and (vii) annual bonus potential or other bonus or incentive entitlements. (if) With respect to the Business Employees and Business Service Providersindependent contractors who provide services to the Business, Seller and each of its Subsidiaries are Affiliates is, and have been since April for the past three (3) years has been, 2015 in material compliance with all applicable Laws respecting labor, employment, immigration, fair employment and employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, including but not limited to wages and hours and the Worker Adjustment classification of employees and Retraining Notification Act of 1988independent contractors, as amended, except as and has not had been and would is not reasonably be expected to have, individually or engaged in any unfair labor practice as defined in the aggregateNational Labor Relations Act or any similar Law. To the Knowledge of Seller, a Business Material Adverse Effect. (j) Seller has provided to Purchaser a complete and accurate list of each Business Employee as of the date hereof of this Agreement, no current Business Employee who is an executive or key employee has given notice of termination of employment or otherwise disclosed plans to terminate employment with the Business in the next twelve (such list, as updated from time to time pursuant to 12) months. For purposes of this Section 5.6(c3.14(f), the defined term Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for ” shall include any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no former employee of Seller or any of its Subsidiaries Affiliates who was actively and primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than employed in the Business. (lg) With respect to the Business Employees, neither Neither Seller nor any of its Subsidiaries is a party toAffiliates has, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material during the two (2)-year period prior to the Businessdate hereof, taken as any action affecting Business Employees that would constitute a whole“mass layoff” or “plant closing” within the meaning of the Worker Adjustment Retraining and Notification Act (the “WARN Act”) or would otherwise trigger notice requirements or Liability under any similar foreign, (i) neither state or local Law. For purposes of this Section 3.14(g), the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employees.defined

Appears in 1 contract

Samples: Asset Purchase Agreement (Gentex Corp)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth, as of the date hereofof this Agreement, a list of each material Benefit Plan and separately identifies each material International Neptune Entity Benefit Plan. With respect Sellers have made available to Purchaser copies of each such material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent if no such copy exists, a written description ofthereof). In addition, in with respect to each casematerial Neptune Entity Benefit Plan, Sellers have made available to Purchaser, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreementagreement or other funding instrument, (ii) the most recent Form 5500 Annual Reportplan booklet, (iii) the most recent recently audited financial statement statements, annual filings, and filed actuarial valuationvaluation reports with any Governmental Entity, (iv) all any material filings and correspondence communications regarding any deficiencies with respect to any Defined Benefit Plan with any Governmental Entity and (v) all any material related agreements, insurance contracts and other agreements which implement each communications with the Business Employees regarding (A) any material modifications to any existing such Neptune Entity Benefit Plan. Seller will make available , or (B) the intention to Purchaser each item adopt or establish any material compensation or benefits arrangements which would, if in clauses existence as of the date of this Agreement, constitute any such Neptune Entity Benefit Plan. (b) Except as would not reasonably be expected to be material and adverse to the Neptune Entities, taken as a whole, (i) through each Neptune Entity Benefit Plan has been registered (vif required), operated, administered, funded and invested in compliance with its terms, applicable Collective Bargaining Agreements and applicable Law, and (ii) of the immediately preceding sentence all contributions and payments required to be made by applicable Law to any Governmental Entity with respect to any Business Employees, or by the terms of a material International Neptune Entity Benefit Plan within 30 days following or applicable Collective Bargaining Agreements have been timely made or accrued in accordance with IFRS in effect as of the date of this Agreement. (bc) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with required by applicable Law, including ERISA, the Code and, applicable Collective Bargaining Agreements or as provided in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) yearsthis Agreement, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (e) No Benefit Plan provides benefits, including death or medical benefits (whether or not insured), with respect to current or former Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions Transaction (either whether alone or in conjunction together with any other eventevents) will, except as required by the terms of this Agreement, will (i) result in any material payment (including severance and unemployment compensation, forgiveness that is the Liability of indebtedness or otherwise) any Neptune Entity becoming due to any Business Employee from Seller (including, without limitation, any bonus, change of control payment, retirement, severance, retirement allowance or its Subsidiaries under any Benefit Plan or otherwiseretention payment), (ii) materially increase any benefits otherwise payable by any Neptune Entity to any Business Employee under any Benefit PlanEmployee, (iii) result in any the acceleration of the time of payment, funding or vesting of any benefits under any Benefit Plan such benefits, or (iv) result in trigger any payment funding obligation under any Neptune Entity Benefit Plan. (whether in cash or property or d) Except where the vesting of property) from Seller or its Subsidiaries failure to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that woulddo so, individually or in combination with any other such payment from Seller or its Subsidiariesthe aggregate, constitute an “excess parachute payment” (would not reasonably be expected to be material and adverse to the Neptune Entities, taken as defined in Section 280G(b)(1) a whole, each of the CodeNeptune Entities, since January 1, 2016, has, to the Knowledge of the Sellers, complied with all applicable Laws pertaining to the employment or termination of employment of their respective Business Employees, including all such Laws relating to employment practices and standards, labor relations, equal employment opportunities, employment equity, pay equity, privacy, Charter of the French Language (Quebec), occupational health and safety, worker’s compensation, harassment, employment insurance, safety and accessibility for people with disabilities requirements, human rights legislation, wages and hours of work and, to the Knowledge of the Sellers, there are no outstanding claims, complaints, charges, proceedings or investigations under any such Laws. (e) To the Knowledge of the Sellers, as of the date of this Agreement, none of the Neptune Entities has any obligation to reinstate any employees or former employees. (f) No event has occurred and, to the Knowledge of the Sellers, no condition or circumstance exists, that has resulted in or could reasonably be expected to result in any Neptune Entity Benefit Plan which is a Defined Benefit Plan being ordered, or required to be, terminated or wound-up in whole or in part, having its registration under applicable Laws refused or revoked, being placed under the administration of any trustee or receiver or Governmental Entity or being required to pay any Taxes, except as would not reasonably be expected to result in a material liability to the Neptune Entities, taken as a whole. (g) Except as has not had and would not reasonably be expected to haveresult in a material liability to the Neptune Entities, taken as a whole, all individuals engaged and compensated by the Neptune Entities as consultants or independent contractors are properly classified as such under applicable Law, and all Business Employees excluded from employment standards legislation under applicable Law are properly classified. (h) During the sixteen (16) weeks prior to the date of this Agreement, no Neptune Entity has taken any action that would reasonably be expected to constitute a “mass termination” or “collective dismissal” as defined in the applicable employment standards legislation affecting any Business Employee. (i) No Persons other than Business Employees or their dependents participate in the Neptune Entity Benefit Plans and no entity other than a Neptune Business Entity participates or sponsors a Benefit Plan for the Business Employees or their dependents. (j) Except where the failure to do so, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal year. (i) With respect to the Business Employees and Business Service Providers, Seller and its Subsidiaries are and have been since April 3, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment practices, terms and conditions of employment, workers’ compensation, occupational safety, plant closings, mass layoffs, worker classification, exempt and non-exempt status, compensation and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, as amended, except as has not had and would not reasonably be expected to havebe material and adverse to the Neptune Entities, individually taken as a whole, with respect to each Neptune Entity Benefit Plan, there are no actions, suits or in claims pending or, to the aggregateKnowledge of the Sellers, a Business Material Adverse Effectthreatened, (other than routine claims for benefits) including any Proceeding. (jk) Section 3.15(k) of the Seller has provided Disclosure Schedules sets forth, as of the date of this Agreement, a list of each collective bargaining agreement of Sellers or any of their Subsidiaries to Purchaser which any Business Employees are subject (collectively, the “Collective Bargaining Agreements”) and no Collective Bargaining Agreement is, as of the date of this Agreement, currently being negotiated by the Sellers or the Neptune Entities. None of the Neptune Entities is a party to or bound by any other labour agreement and there are no labour unions, employee associations or other organizations with bargaining rights (either acquired by certification or voluntary recognition) representing, nor to the Sellers’ Knowledge, purporting to represent or attempting to represent any Business Employees. Except as would not reasonably be expected to result in a material liability to the Neptune Entities, taken as a whole: (i) the Sellers and the Neptune Entities are not in breach of the Collective Bargaining Agreements. There are no outstanding labour or employment Proceedings of any kind (including unfair labour complaints, grievances, arbitrations or applications for declaration of successor employer) respecting the Business or the Neptune Entities. During the two (2)-year period immediately prior to the date of this Agreement, there have been no strikes, walkouts, work stoppages, slow-downs or lockouts involving Business Employees. (l) Section 3.15(l) of the Seller Disclosure Schedules sets forth, as of the date of this Agreement, a complete and accurate list of each Business Employee as of and consultant to the date hereof (such list, as updated from time to time pursuant to Section 5.6(c), Business which sets forth the “Service Provider List”), and, following information with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Laweach: (i) age (except where information regarding age is not gathered in the ordinary course of business with respect to consultants); (ii) date of hire or engagement; (iii) title or position; (iiiv) original date of hire the entity or original commencement of serviceentities by which such employee is employed or consultant is engaged; (iiiv) whether current wage/compensation rate (e.g. salary, hourly, contract period, commission, consulting fee) and last bonus, as applicable; (vi) active or inactive status and, if applicable, the reason for the inactive status and anticipated return to work date; (vii) full-time or part-time, whether hourly or salaried and whether exempt or non-exempttime status; (ivviii) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensationlocation; and (viiix) any shift differentials or on call pay. As soon union affiliation. (m) Except as practicable following the date hereof (and set forth in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (viSection 3.15(l) of the immediately preceding sentenceSeller Disclosure Schedules, indicating each Business Service Provider’s annualized consulting payments)no employment agreement (whether oral or written) provides for a contractual termination provision, and which update shall (A) identify whether each individual on except as would otherwise exist in respect of the Service Provider List is termination of an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work locationat common law. (kn) Every Business Employee as Any other representation or warranty contained in this Article III notwithstanding, the representations and warranties contained in this Section 3.15 constitute the sole representations and warranties of the date hereof has been primarily dedicated Sellers relating to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller employees and its Subsidiaries other than the BusinessBenefits Plans. (l) With respect to the Business Employees, neither Seller nor any of its Subsidiaries is a party to, or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect to the formation of a collective bargaining unit presently being made or, to the Seller’s Knowledge, threatened involving Business Employees.

Appears in 1 contract

Samples: Stock Purchase Agreement (Maxar Technologies Inc.)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.15(a) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, each material Benefit Plan and separately identifies as such each material International Purchased Company Benefit Plan and material Purchased Entity Benefit Plan. With respect to each material Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of each such material Benefit Plan (or, to the extent that no such copy exists, a an accurate written description of)thereof) and, in to the extent applicable, the currently effective summary plan description required under ERISA. In addition, with respect to each casePurchased Entity Benefit Plan, Seller has made available to Purchaser, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, agreement or other funding instrument; (ii) the most recent Form 5500 Annual ReportInternal Revenue Service determination letter, if applicable; and (iii) the most recent (A) Form 5500 and attached schedules, (B) audited financial statement and actuarial valuationstatements, (iv) all material filings and correspondence with any Governmental Entity and (vC) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreementactuarial valuation reports. (b) Except Each Purchased Company Benefit Plan intended to be qualified within the meaning of Section 401(a) of the Code has received a favorable determination letter from the United States Internal Revenue Service as to its qualification and, to the Knowledge of Seller, no event has not had and occurred that would not reasonably be expected to havegive rise to a revocation of such determination or opinion. (c) Each Purchased Company Benefit Plan has been operated in material compliance with its terms and applicable Law. All material contributions, individually premiums and expenses required to be made to or paid in respect of a Purchased Company Benefit Plan, whether by Law or by the terms of the Purchased Company Benefit Plan or any agreement relating thereto, have been timely made. (d) Except as set forth on Section 3.15(d) of the Seller Disclosure Schedules, no Purchased Company Benefit Plan is subject to Title IV of ERISA, is a Multiemployer Plan or is a “multiple employer welfare arrangement” within the meaning of Section 3(40) of ERISA. No condition exists that would reasonably be expected to result in Purchaser or any of its Affiliates incurring a Liability under Title IV of ERISA by reason of any Benefit Plan. (e) Except as required by applicable Law or as set forth on Section 3.15(e) of the Seller Disclosure Schedules, neither the execution of this Agreement nor the consummation of the transactions contemplated by this Agreement (whether alone or together with any other events) will (i) result in any payment that is the Liability of the Business becoming due to any Business Employee, (ii) increase any benefits otherwise payable by the Business to or in respect of any Business Employee (other than any increases for which Seller and its Affiliates (other than the Purchased Companies) are exclusively liable) or (iii) result in the acceleration of the time of payment or vesting of any such benefits. No Purchased Consolidated Venture, Purchased Entity or Subsidiary of a Purchased Consolidated Venture or Purchased Entity is a party to any plan, program, policy, agreement or arrangement that would reasonably be expected to result, separately or in the aggregate, a Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the payment of any “excess parachute payments” within the meaning of Section 280G of the Code andby reason of the Transaction. (f) There are no pending or, to the Knowledge of Seller, threatened material claims by or on behalf of any Purchased Company Benefit Plan, by any employee or beneficiary covered under any Purchased Company Benefit Plan in their capacity as such or otherwise involving any Purchased Company Benefit Plan (in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related thereto. (c) No liability under Title IV of ERISA has been incurred by Seller or its Subsidiaries or any of their respective ERISA Affiliates that has not been satisfied in full, and to Seller’s Knowledge no condition exists that is likely to cause Seller or its Subsidiaries or any of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any Liability with respect to an employee benefit plan subject to Section 302 or Title IV of ERISA or Section 412, 430 or 4971 of the Code. None of Seller, its Subsidiaries or any of their respective ERISA Affiliates has incurred or is reasonably expected to incur any Controlled Group Liability that has not been satisfied in full. (d) Neither the Seller, its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated to contribute to or had any liability (including any contingent liability) with respect to any Multiemployer Plan or a plan that has two (2) or more contributing sponsors, at least two (2) of whom are not under “common control” (within the meaning of Section 4063 of ERISA). (eg) No Purchased Company Benefit Plan provides benefits, including death or medical welfare benefits (whether or not insured), with in respect to current or former of Business Employees beyond their retirement or other termination of service, other than (i) coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state applicable Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any death benefits otherwise payable to any Business Employee under any Benefit Plan“pension plan” within the meaning of Section 3(2) of ERISA, or (iii) result in any acceleration benefits the costs of which are borne by the time of payment, funding or vesting of any benefits under any Benefit Plan or (iv) result in any payment (whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an “excess parachute payment” (as defined in Section 280G(b)(1) of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptionshis beneficiary. (h) Each Purchased Company Benefit Plan has been maintained to the extent applicable in material compliance with Section 3.7(h) 409A of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, with respect to each such plan, indicates the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal yearCode. (i) With respect to each International Benefit Plan that is a Purchased Company Benefit Plan: (i) all employer and employee contributions required by Law or by the terms of such International Benefit Plan have been made, or, if applicable, accrued, in accordance with normal accounting practices; (ii) the fair market value of the assets of such International Benefit Plan, the liability of each insurer for such International Benefit Plan funded through insurance or the book reserve established for such International Benefit Plan, together with any accrued contributions, is sufficient to provide for the accrued benefit obligations with respect to all current and former participants in such International Benefit Plan according to the actuarial assumptions and valuations most recently used to determine required contributions to or in respect of such International Benefit Plan; and (iii) each such International Benefit Plan required to be registered with any Governmental Entity has been registered and has been maintained in good standing with all applicable Governmental Entities. (j) Set forth on Section 3.15(j) of the Seller Disclosure Schedules is a true, correct and complete list, as of the date of this Agreement, of each collective bargaining or other labor-related agreement or arrangement with any labor union, labor organization, works council or other body representing Current Business Employees. During the two (2)-year period immediately prior to the date of this Agreement, there have been no actual, or to the Knowledge of Seller, threatened labor disputes, work stoppages, strikes or lockouts involving Current Business Employees, except for such labor disputes, work stoppages, strikes or lockouts the existence of which would not reasonably be expected to be, individually or in the aggregate, material to the Business. (k) To the Knowledge of Seller, with respect to the Business, (i) there is no organizational effort currently being made or threatened by, or on behalf of, any labor union, works council or other labor organization to organize any Current Business Employees and (ii) no demand for recognition of any Current Business Service ProvidersEmployee has been made by, or on behalf of, any labor union, works council or other labor organization. (l) Except as would not reasonably be expected to be, individually or in the aggregate, material to the Business, with respect to Business Employees and independent contractors who provide services to the Business, Seller and each of its Subsidiaries are Affiliates is, and have been since April 3for the past two (2) years has been, 2015 in compliance with all applicable Laws respecting labor, employment, immigration, fair employment and employment practices, including, without limitation, all Laws respecting terms and conditions of employment, classification of employees and independent contractors, health and safety, wages and hours, child labor, immigration, employment discrimination, disability rights or benefits, equal opportunity, equal pay, plant closures and layoffs, affirmative action, workers’ compensation, occupational safetylabor relations, plant closingsemployee leave issues and unemployment insurance. (m) Seller has provided to Purchaser a true and correct list of each Person who would be a Current Business Employee assuming the Closing had occurred on November 19, mass layoffs2013, worker classificationand for each such Current Business Employee such Current Business Employee’s (i) job title, (ii) principal work location, (iii) hire date, (iv) status as exempt and or non-exempt (if a Current U.S. Business Employee), (v) active or inactive status, compensation (vi) base salary or base wage rate and benefits, wages and hours and the Worker Adjustment and Retraining Notification Act of 1988, (vii) annual bonus potential. (n) Except as amended, except as has not had and would not reasonably be expected to havebe, individually or in the aggregate, a material to the Business, with respect to Business Material Adverse EffectEmployees, the Seller and each of its Affiliates have not received (i) notice of any unfair labor practice charge or complaint pending or threatened before the National Labor Relations Board or any other Governmental Entity against them, (ii) notice of any complaints, grievances or arbitrations arising out of any collective bargaining agreement, (iii) notice of any charge, complaint or investigation with respect to or relating to them pending by or before the Equal Employment Opportunity Commission or any other Governmental Entity responsible for the prevention of unlawful employment practices, or (iv) notice of any complaint, lawsuit or other proceeding pending or threatened in any forum by or on behalf of any Business Employee of such entities, any applicant for employment or classes of the foregoing alleging breach of any applicable law governing employment or the termination thereof. (jo) Seller has provided to Purchaser a complete and accurate list To the Knowledge of each Business Employee Seller, as of the date hereof (such listof this Agreement, as updated from time to time pursuant to Section 5.6(c)no Business Employee at the level of Grades 181-185 or Grades 610 and above is in any material respect in violation of any term of any employment agreement, the “Service Provider List”)nondisclosure agreement, and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired competition agreement, restrictive covenant or recommenced serviceother, the date of such termination, the date such individual was rehired similar obligation with or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to Affiliates. To the Business has been transferred to any division or business unit Knowledge of Seller and its Subsidiaries other than Seller, as of the Business. (l) With respect to the Business Employeesdate of this Agreement, neither Seller nor any of its Subsidiaries Affiliates has received notice that any Business Employee at the level of Grades 181-185 or Grades 610 and above is in any material respect in violation of any of the aforementioned agreements with or similar obligations to a party to, or bound by, former employer of any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected such employee relating (A) to the right of any such employee to be material employed by the Seller or any of its Affiliates or (B) to the Businessknowledge or use of trade secrets or proprietary information. (p) To the Knowledge of the Seller, taken as a wholeof the date of this Agreement, no Current Business Employee at the level of Grades 181–185 or Grades 610 and above has given or has been given, notice of termination of employment with Seller or any of its Affiliates. (iq) neither the Neither Seller nor any of its Subsidiaries is (or has Affiliates has, during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts with respect 2)-year period immediately prior to the formation date hereof, taken any action affecting Business Employees that would constitute a “mass layoff” or “plant closing” within the meaning of a collective bargaining unit presently being made orthe Worker Adjustment Retraining and Notification Act or would otherwise trigger notice requirements or Liability under any similar foreign, to the Seller’s Knowledge, threatened involving Business Employeesstate or local Law.

Appears in 1 contract

Samples: Purchase Agreement (Visteon Corp)

Labor Relations; Employees and Employee Benefit Plans. (a) Section 3.7(a3.18(a) of the Seller Disclosure Letter Schedules sets forth, as forth a list of the date hereof, each material Benefit Business Plan and separately identifies as such each material International Purchased Company Benefit Plan. With Seller has made available to Buyer correct and complete copies of each Business Plan (or, to the extent that no such copy exists, an accurate written description thereof) and, to the extent applicable, the currently effective summary plan description required under ERISA. In addition, with respect to each material Purchased Company Benefit Plan (other than an International Plan), Seller has made available to Purchaser correct and complete copies of (or, to the extent no such copy exists, a description of), in each caseBuyer, to the extent applicable, (i) all plan documents, summary plan descriptions, summaries of material modifications, and amendments related to such plans and any related trust agreement, agreement or other funding instrument; (ii) the most recent Form 5500 Annual Report, Internal Revenue Service determination letter; and (iii) the three most recent (A) Form 5500 and attached schedules, (B) audited financial statement and actuarial valuationstatements, (ivC) actuarial valuation reports and (D) all material filings and correspondence with the Internal Revenue Service, Department of Labor or Pension Benefit Guaranty Corporation regarding any Governmental Entity and Benefit Plan during the last three (v3) all material related agreements, insurance contracts and other agreements which implement each such Benefit Plan. Seller will make available to Purchaser each item in clauses (i) through (v) of the immediately preceding sentence with respect to a material International Plan within 30 days following the date of this Agreementyears. (b) Except Each Business Plan intended to be “qualified” within the meaning of Section 401(a) of the Code has received a favorable determination letter from the United States Internal Revenue Service as to its qualification and, to the Knowledge of Seller, no event has not had and would not occurred that could reasonably be expected to have, individually or result in the aggregate, a disqualification of such Business Material Adverse Effect, (i) each Assumed International Plan has been operated and administered in accordance with its terms and in compliance with applicable Law, including ERISA, the Code and, in each case, the regulations thereunder, (ii) all contributions or other amounts payable by Seller or its Subsidiaries pursuant to each Assumed International Plan in respect of current or prior plan years have been timely paid or accrued in accordance with GAAP or applicable international accounting standards, and (iii) as of the date hereof, there are no pending, or to Seller’s Knowledge, threatened or anticipated claims, actions, investigations or audits (other than routine claims for benefits) by, on behalf of or against any Assumed International Plan or any trusts related theretoPlan. (c) Each Business Plan has been operated in compliance in all material respects with its terms and applicable Law. All contributions, premiums and expenses required to be made to or paid in respect of a Business Plan, whether by Law or by the terms of the Business Plan or any agreement relating thereto, have been timely made, and any delinquent employee contributions to such Business Plan have been fully corrected according to applicable procedures established by the Internal Revenue Service and Department of Labor. (d) Except as set forth on Section 3.18(d) of the Seller Disclosure Schedules, no Business Plan is subject to Title IV of ERISA, is a Multiemployer Plan or is a “multiple employer welfare arrangement” within the meaning of Section 3(40) of ERISA. No liability under Title IV of ERISA has been incurred by Seller Seller, the Purchased Company or its Subsidiaries any Subsidiary of the Purchased Company or any of their respective ERISA Affiliates that has not been satisfied in fullfull when due, and to Seller’s Knowledge no condition exists that is likely presents a risk to cause Seller or its Subsidiaries or any Buyer of their ERISA Affiliates to incur any such liability. Within the last six (6) years, neither Seller nor any of its Subsidiaries has sponsored, maintained or incurred any incurring a Liability with respect to an employee benefit plan subject to Section 302 or under Title IV of ERISA by reason of any Benefit Plan. No Business Plan subject to the minimum funding requirements of Section 412 of the Code or Section 412, 430 or 4971 302 of the Code. None of Seller, its Subsidiaries ERISA or any of their respective ERISA Affiliates trust established thereunder has incurred or is reasonably expected failed to incur satisfy such requirements (determined without regard to any Controlled Group Liability that has not been satisfied in full. (d) Neither the Sellerwaiver thereof), its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the preceding six (6) years, contributed to, been obligated and all contributions required to contribute to or had any liability (including any contingent liability) be made with respect thereto (whether pursuant to any Multiemployer the terms of a Business Plan or a plan that has two (2otherwise) or more contributing sponsors, at least two (2) of whom are not under have been timely made. No common controlreportable event(within the meaning of Section 4063 4043 of ERISA)ERISA has occurred by reason of the execution of this Agreement or will occur by reason of the transactions contemplated by this Agreement. (e) Except as set forth on Section 3.18(e) of the Seller Disclosure Schedules, neither the execution of this Agreement nor the consummation of the transactions contemplated by this Agreement will: (i) result in any payment that is the Liability of the Business becoming due to any Business Employee or Service Provider; (ii) increase any benefits otherwise payable by the Business to or in respect of any Business Employee or Service Provider; or (iii) result in the acceleration of the time of payment or vesting of any such benefits. Neither the Purchased Company nor any Subsidiary of the Purchased Company is a party to, or could be liable for any payment under, any plan, program, policy, agreement or arrangement that could result, separately or in the aggregate, in the payment of any “excess parachute payments” within the meaning of Section 280G of the Code by reason of the Transaction. (f) There are no pending or, to the Knowledge of Seller, threatened claims by or on behalf of any Business Plan, by any employee or beneficiary covered under any Business Plan in their capacity as such or otherwise involving any Business Plan (other than routine claims for benefits). (g) No Benefit Business Plan provides benefits, including death or medical welfare benefits (whether or not insured), with in respect to current or former of Business Employees beyond their retirement or other termination of service, other than coverage mandated by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, or comparable U.S. state Law. (f) Neither the execution and delivery of this Agreement nor the consummation of the Transactions (either alone or in conjunction with any other event) will, except as required by the terms of this Agreement, (i) result in any payment (including severance and unemployment compensation, forgiveness of indebtedness or otherwise) becoming due to any Business Employee from Seller or its Subsidiaries under any Benefit Plan or otherwisecoverage mandated solely by applicable Law, (ii) increase any death benefits otherwise payable to any Business Employee under any Benefit Plan“pension plan” within the meaning of Section 3(2) of ERISA, or (iii) result in benefits the full costs of which are borne by the Business Employee or his beneficiary. (h) Neither Buyer nor the Purchased Company will incur any acceleration liability for noncompliance with respect to Section 409A and Section 457A of the time Code. (i) Schedule 3.18(i) sets forth (i) a description of payment, funding or vesting of any benefits under any Benefit Plan or (ivthe method(s) result used by Seller in any payment (the current calendar year in determining whether in cash or property or the vesting of property) from Seller or its Subsidiaries to any “disqualified individual” (as such term is defined in Treasury Regulations Section 1.280G-1) who each Current Business Employee is a Transferred Business Employee that would, individually or in combination with any other such payment from Seller or its Subsidiaries, constitute an excess parachute paymentfull-time employee” (as defined in Section 280G(b)(1) 4980H of the Code). (g) Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effect, each Assumed International Plan (i) has been operated in conformance with the applicable statutes or governmental regulations and rulings relating to such plans in the jurisdictions in which such Assumed International Plan is present or operates and, to the extent relevant, the United States, (ii) that is intended to qualify for special tax treatment meets all requirements for such treatment and (iii) that is intended to be funded and/or book-reserved is fully funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions. (h) Section 3.7(h) of the Seller Disclosure Letter (i) contains a true and complete list of each International Plan that provides for defined benefit or termination indemnity benefits to Business Employees, and (ii) for which liabilities are recognized in the ordinary course of Seller’s financial reporting practice and, estimated potential penalties (if any) pursuant to Section 4980H(a) and or 4980H(b) of the Code with respect to each such plan, indicates any month in the net balance sheet asset or liability of such plan as of the last day of Seller’s most recently completed fiscal current calendar year. (ij) No Purchased Company Benefit Plan is an International Benefit Plan. No Business Employee is an International Business Employee. (k) No Current Business Employees or Service Providers are represented by a labor union, labor organization or works council with respect to their employment or engagement with Seller or any of its Affiliates. During the two (2)-year period immediately prior to the date of this Agreement, there have been no actual, or to the Knowledge of Seller, threatened arbitrations, grievances, Proceedings, labor disputes, strikes, lockouts, slowdowns or work stoppages against or affecting Seller or any Affiliate of Seller. (l) No labor union, labor organization, works council or group of employees of Seller or any Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) has made a pending demand for recognition or certification, and there are no representation or certification proceedings or petitions seeking a representation proceeding presently pending or threatened in writing to be brought or filed with the National Labor Relations Board or any other labor relations tribunal or authority. Neither Seller nor any Affiliate of Seller has any Knowledge of any labor union organizing activities with respect to any Business Employees. (m) With respect to the Business Employees and Business Service ProvidersProviders who provide services to the Business, to the Knowledge of Seller, Seller and its Subsidiaries each Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) are and have been since April 3, 2015 in compliance in all material respects with all applicable Laws respecting labor, employment, immigration, fair employment and employment practices, including all laws respecting terms and conditions of employment, classification of employees and independent contractors, health and safety, wages and hours, child labor, immigration, employment discrimination, disability rights or benefits, equal opportunity, plant closures and layoffs, affirmative action, workers’ compensation, occupational safetylabor relations, plant closingsemployee leave issues and unemployment insurance. (n) Neither Seller nor any Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) is and has not been: (i) a “contractor” or “subcontractor” (as defined by Executive Order 11246), mass layoffs(ii) required to comply with Executive Order 11246 or (iii) required to maintain an affirmative action plan. (o) To the Knowledge of Seller, worker classificationneither Seller nor any Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) is delinquent in payments to any Business Employees or Service Providers for any services or amounts required to be reimbursed or otherwise paid. (p) Set forth on Section 3.18(p) of the Seller Disclosure Schedules is a true and correct list of each Current Business Employee and Service Provider, and for each such person, such person’s: (i) name and job title, (ii) principal work location, (iii) hire date, (iv) work status (i.e. full-time, part-time, temporary, etc.), (v) accrued paid time off, (vi) status as exempt and or non-exempt (if a Current U.S. Business Employee), (vii) active or inactive status and his or her expected return to work date, (viii) visa status, compensation (ix) base salary or base wage rate, (x) annual bonus potential or other bonus or incentive entitlements and benefits(xi) to the Knowledge of Seller, whether such person was previously an employee of Buyer or its Affiliates. No Current Business Employee or Service Provider has a work location outside the United States. (q) Except as set forth on Section 3.18(q) of the Seller Disclosure Schedules) with respect to Business Employees and Service Providers, neither Seller nor any Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) has received within the past 24 months: (i) notice of any unfair labor practice charge or complaint pending or threatened before the National Labor Relations Board or any other Governmental Entity against them, (ii) notice of any complaints, grievances or arbitrations arising out of any collective bargaining agreement or any other complaints, grievances or arbitration procedures against them, (iii) notice of any charge or complaint with respect to or relating to them pending before the Equal Employment Opportunity Commission or any other Governmental Entity responsible for the prevention of unlawful employment practices, (iv) notice of the intent of any Governmental Entity responsible for the enforcement of labor, employment, wages and hours of work, child labor, immigration or occupational safety and health laws to conduct an investigation with respect to or relating to them or notice that such investigation is in progress, or (v) notice of any complaint, lawsuit or other proceeding pending or threatened in any forum by or on behalf of any Business Employee or current or former Service Provider of such entities, any applicant for employment or classes of the foregoing alleging breach of any express or implied contract of employment, any applicable law governing employment or the termination thereof or other discriminatory, wrongful or tortious conduct in connection with the employment relationship. (r) Seller and each Affiliate of Seller (including the Purchased Company or a Subsidiary of the Purchased Company) is and has been in compliance with all notice and other requirements under the Worker Adjustment and Retraining Notification Act of 1988and any similar foreign, as amended, except as has not had state or local Law relating to plant closings and would not reasonably be expected to have, individually or in the aggregate, a Business Material Adverse Effectlayoffs. (js) Seller has provided to Purchaser a complete and accurate list of each No Business Employee or current or former Service Provider is in any respect in violation of any term of any employment agreement, common law nondisclosure obligation, fiduciary duty, Restrictive Covenant or other obligation: (i) to Seller or any Affiliate of Seller or (ii) to a former employer or engager of any such individual relating (A) to the right of any such individual to be employed by Seller or any Affiliate of Seller or (B) to the knowledge or use of trade secrets or proprietary information. (t) Except as set forth in Section 3.18(t) of the Seller Disclosure Schedules, as of the date hereof (such listhereof, as updated from time to time pursuant to Section 5.6(c), the “Service Provider List”), and, with respect to each such individual, the following information, if applicable, to the extent permitted by applicable Law: (i) title or position; (ii) original date of hire or original commencement of service; (iii) whether full-time or part-time, whether hourly or salaried and whether exempt or non-exempt; (iv) if such individual was previously terminated and been rehired or recommenced service, the date of such termination, the date such individual was rehired or recommenced services and any applicable adjusted service date; (v) whether absent from active employment or service; (vi) annual salary or wage rate and, if applicable, target bonus, and other cash incentive compensation and unvested equity compensation; and (vii) any shift differentials or on call pay. As soon as practicable following the date hereof (and in any event within 30 days of the date hereof), Seller shall provide Purchaser with an update to the Service Provider List, which shall be complete and accurate, in order to provide the information described in the immediately preceding sentence with respect to each Business Service Provider (in the case of clause (vi) of the immediately preceding sentence, indicating each Business Service Provider’s annualized consulting payments), and which update shall (A) identify whether each individual on the Service Provider List is an employee of Seller or one of its Subsidiaries, a Business Service Provider who provides services to the Business through an individual contract or a Business Service Provider who provides services to Business through a third party agency, (B) provide the name of each Business Employee and Business Service Provider, (C) provide the target bonus, and other cash incentive compensation for such Business Employee or Business Service Provider for the prior twelve (12)-month period and such Business Employee’s or Business Service Provider’s equity compensation (including annual grants) for the prior three (3)-year period, (D) provide each Business Employee’s and Business Service Provider’s accrued unused vacation, sick and other paid-time-off eligibility, (E) if a Business Employee or Business Service Provider is absent from active employment or service, provide the type of absence, provide the date such absence commenced and the anticipated date of return to active employment or active service and (F) provide each Business Employee’s and Business Service Provider’s work location. (k) Every Business Employee as of the date hereof has been primarily dedicated to the Business since December 31, 2018 (or, for any such Business Employee hired after December 31, 2018, since the date of such Business Employee’s hire). Since December 31, 2018, no employee of Seller or any of its Subsidiaries who was primarily dedicated to the Business has been transferred to any division or business unit of Seller and its Subsidiaries other than the Business. (l) With respect Purchased Company or a Subsidiary of the Purchased Company is in compliance with any requirement to the Business Employeesinform or consult with any labor organization, neither Seller nor any of its Subsidiaries is a party tounion, works council or bound by, any Collective Bargaining Agreement. Except as has not been and would not reasonably be expected to be material to the Business, taken as a whole, (i) neither the Seller nor any of its Subsidiaries is (or has during the past two (2) years been) subject to a material labor dispute, strike or work stoppage and (ii) there are no organizational efforts employee representative body with respect to the formation of a transaction contemplated by this Agreement or any collective bargaining unit presently being made oragreement or similar labor Contract or applicable Law. (u) The execution of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in any breach or other violation of any collective bargaining agreement, employment agreement, consulting agreement or any other labor-related Contract to which Seller or any Affiliate of Seller (including the Seller’s Knowledge, threatened involving Business EmployeesPurchased Company or a Subsidiary of the Purchased Company) is a party.

Appears in 1 contract

Samples: Purchase Agreement (Swisher Hygiene Inc.)

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