Common use of Payroll Reporting and Withholding Clause in Contracts

Payroll Reporting and Withholding. (a) Vital Images and Bio-Vascular hereby adopt the "alternative procedure" for preparing and filing IRS Forms W-2 (Wage and Tax Statements), as described in Section 5 of Revenue Procedure 84-77, 1984-2 IRS Cumulative Bulletin 753 ("Rev. Proc. 84-77"). Under this procedure Vital Images as the successor employer shall provide all required Forms W-2 to all Vital Images Employees reflecting all wages paid and taxes withheld by both Bio-Vascular as the predecessor and Vital Images as the successor employer for the entire year during which the Distribution takes place. Bio-Vascular shall provide all required Forms W-2 to all Bio-Vascular Employees reflecting all wages and taxes paid and withheld by Bio-Vascular before, on and after the Distribution Date. In connection with the aforesaid agreement under Rev. Proc. 84-77, each Retained Bio-Vascular Employee or Vital Images Employee shall be assigned for payroll reporting purposes to Bio- Vascular or Vital Images, as the case may be. (b) Vital Images and Bio-Vascular agree to adopt the alternative procedure of Rev. Proc. 84-77 for purposes of filing IRS Forms W-4 (Employee's Withholding Allowance Certificate) and W-5 (Earned Income Credit Advance Payment Certificate). Under this procedure Bio-Vascular shall provide to Vital Images as the successor employer all IRS Forms W-4 and W-5 on file with respect to each Vital Images Employee, and Vital Images will honor these forms until such time, if any, that such Vital Images Employee submits a revised form. (c) With respect to Employees with garnishments, tax levies, child support orders, qualified medical child support orders, and wage assignments in effect with Bio-Vascular on the Cutoff Date, Vital Images with respect to each Vital Images Employee and their dependents shall honor such payroll deduction authorizations or court or governmental orders applicable to Vital Images Plans, and will continue to make payroll deductions and payments to any authorized payee, as specified by the court or governmental order that was filed with Bio-Vascular. Likewise, Bio-Vascular with respect to each Bio-Vascular Employee shall honor such payroll deduction authorization or court or governmental orders applicable to Bio-Vascular Plans and will continue to make payroll deductions and payments to any authorized payee, as specified by the court or governmental order that was filed with Bio-Vascular. (d) Unless otherwise prohibited or provided by this Agreement or another agreement entered into in connection with the Distribution, or by a Plan document, with respect to Employees with authorizations for payroll deductions in effect with Bio-Vascular on the Cutoff Date, Vital Images as the successor employer will honor such payroll deduction authorizations relating to each Vital Images Employee, including, without limitation, scheduled loan repayments to the 401(k) Retirement Plan and direct deposit of payroll, bonus advances and types of authorized company receivables usually collectible through payroll deductions, and shall not require that such Vital Images Employee submit a new authorization to the extent that the type of deduction by Vital Images does not differ from that made by Bio- Vascular.

Payroll Reporting and Withholding. (a) Vital Images Form W-2 Reporting. CLR and Bio-Vascular Culbro and/or Holdings hereby adopt the "alternative procedure" for preparing and filing IRS Forms W-2 (Wage and Tax Statements), as described in Section 5 of Revenue Procedure 84-77, 1984-2 IRS Cumulative Bulletin 753 ("Rev. Proc. 84-77"). Under this procedure Vital Images CLR as the successor employer shall provide all required Forms W-2 to all Vital Images Transferred Employees reflecting all wages paid and taxes withheld by both Bio-Vascular Culbro as the predecessor and Vital Images CLR as the successor employer for the entire year during which the Distribution takes place. Bio-Vascular Holdings shall provide all required Forms W-2 to all Bio-Vascular Retained Employees reflecting all wages and taxes paid and withheld by Bio-Vascular before, Culbro before the Distribution Date and by Holdings on and after the Distribution Date. In connection with the aforesaid agreement under Rev. Proc. 84-77, each business unit or business operation of Culbro shall be assigned to either Holdings or CLR, depending upon whether it is a Retained Bio-Vascular Business or a Transferred Business, and each Retained Employee or Vital Images Transferred Employee associated with such business unit or business operation shall be assigned for payroll reporting purposes to Bio- Vascular Holdings or Vital ImagesCLR, as the case may be. Holdings and CLR shall be responsible for filing IRS Forms 941 for their respective Employees. (b) Vital Images Forms W-4 and Bio-Vascular W-5. CLR and Holdings agree to adopt the alternative procedure of Rev. Proc. 84-77 for purposes of filing IRS Forms W-4 (Employee's Withholding Allowance Certificate) and W-5 (Earned Income Credit Advance Payment Certificate). Under this procedure Bio-Vascular Holdings shall provide to Vital Images CLR as the successor employer all IRS Forms W-4 and W-5 on file with respect to each Vital Images Transferred Employee, and Vital Images CLR will honor these forms until such time, if any, that such Vital Images Transferred Employee submits a revised form. (c) Garnishments, Tax Levies, Child Support Orders, and Wage Assignments. With respect to Employees with garnishments, tax levies, child support orders, qualified medical child support orders, and wage assignments in effect with Bio-Vascular Culbro on the Cutoff Asset Transfer Date, Vital Images CLR as the successor employer with respect to each Vital Images Transferred Employee and their dependents shall honor such payroll deduction authorizations or court or governmental orders applicable to Vital Images Plans, and will continue to make payroll deductions and payments to any the authorized payee, as specified by the court or governmental order that which was filed with Bio-Vascular. Likewise, Bio-Vascular with respect to each Bio-Vascular Employee shall honor such payroll deduction authorization or court or governmental orders applicable to Bio-Vascular Plans and will continue to make payroll deductions and payments to any authorized payee, as specified by the court or governmental order that was filed with Bio-VascularCulbro. (d) Unless otherwise prohibited or provided by this Agreement or another agreement entered into in connection with the Distribution, or by a Plan document, with respect to Employees with authorizations for payroll deductions in effect with Bio-Vascular on the Cutoff Date, Vital Images as the successor employer will honor such payroll deduction authorizations relating to each Vital Images Employee, including, without limitation, scheduled loan repayments to the 401(k) Retirement Plan and direct deposit of payroll, bonus advances and types of authorized company receivables usually collectible through payroll deductions, and shall not require that such Vital Images Employee submit a new authorization to the extent that the type of deduction by Vital Images does not differ from that made by Bio- Vascular.