Common use of Welfare Benefits Plans Clause in Contracts

Welfare Benefits Plans. (a) The participation by Transferred Company Employees in Welfare Plans that are Parent Benefit Plans shall continue until immediately prior to the Closing Date. Effective as of the Closing Date, Purchaser shall ensure commencement of coverage for each Transferred Company Employee who was a participant in the Company’s Welfare Plans as of the Closing Date in Welfare Plans maintained by Purchaser and its Affiliates (it being understood that for this purpose the provision of benefits to the Transferred Company Employees under the Parent Welfare Plans (as defined in the EBTA) during the Welfare Plan Transition Period (as defined in the EBTA) shall fulfill Purchaser’s obligations with respect to the provision of the types of welfare benefits provided under the EBTA). (b) Except as otherwise provided in this Article VI, (i) Parent and its Affiliates shall be solely liable for any claims for Welfare Benefits that are incurred by or with respect to any Transferred Company Employee and his or her beneficiaries or dependents under a Parent Benefit Plan before the Closing Date, and (ii) Purchaser shall be solely liable for any claims for Welfare Benefits that are incurred by or with respect to any Transferred Company Employee and his or her beneficiaries or dependents on or after the Closing Date (provided that with respect to claims incurred under the Parent Welfare Plans during the Welfare Plan Transition Period, the terms of Purchaser’s liability are set forth in the EBTA). For purposes of the foregoing, the following claims and liabilities shall be deemed to be incurred as follows: (x) life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, disability or accident giving rise to such benefits; (y) hospital-provided health, dental, prescription drug or other benefits, which become payable with respect to any hospital confinement, upon commencement of such confinement; and (z) medical, dental, and vision, when the services are rendered, the supplies are provided or prescribed medication is acquired by the participant, and not when the condition arose. (c) With respect to the coverage of the Transferred Company Employees under Purchaser’s Welfare Plans, (i) each such employee’s credited service with Parent and its Affiliates shall be credited against any waiting period applicable to eligibility for enrollment of new employees under Purchaser’s Welfare Plans; (ii) limitations on benefits due to pre-existing conditions shall be waived for any Transferred Company Employee enrolled in any Welfare Plan maintained by Parent and its Affiliates (which shall include for this purpose the Parent Welfare Plans in which a Transferred Company Employee participated during the Welfare Plan Transition Period) as of the Welfare Plan Transition Period End Date to the extent waived under such plans; and (iii) any out-of-pocket annual maximums and deductibles taken into account under the Parent Group Health Plan for any Transferred Company Employee in the plan year that contains the Welfare Plan Transition Period End Date shall be credited under Purchaser’s Welfare Plans for the same year. With respect to aggregate lifetime maximum benefits available under Purchaser’s Welfare Plans, a Transferred Company Employee’s prior claim experience under any of the component programs of the Welfare Plan maintained by Parent and its Affiliates will not be taken into account. (d) Effective as of the Closing Date, Purchaser shall be responsible for, and shall assume all liability with respect to, providing the notices and making available the health care continuation coverage, all as required by Section 4980B of the Code, for all of the Transferred Company Employees and their respective covered dependents, whose qualifying events (as defined in Code Section 4980B) occur on or after the Closing Date (it being understood that for this purpose the Purchaser’s satisfaction of its obligations with respect to COBRA coverage during the Welfare Plan Transition Period as set forth in the EBTA shall fulfill Purchaser’s obligations under this Section 6.2(d)). (e) Notwithstanding anything in this Agreement to the contrary, (i) if any Transferred Company Employee has become disabled (within the meaning of the applicable short-term disability plan of Parent and its Affiliates) on or prior to the Closing Date, any short-term disability salary continuation income benefits relating to such disability shall be paid under the terms of such short-term disability program as in effect immediately through the Closing Date and, following the Closing Date, shall be the sole responsibility of Purchaser, and (ii) Purchaser shall be solely responsible for short-term disability salary continuation income benefits of any Transferred Company Employee (or new employee of the Business) who becomes disabled during the Welfare Plan Transition Period. Any Transferred Company Employee who becomes disabled (within the meaning of the applicable long-term disability plan of the Parent) while covered by such plan on or prior to the Welfare Plan Transition Period End Date shall be eligible for benefits under the terms of such plan. From and after the Closing Date, any right to reemployment for any Transferred Company Employees who are on short-term or long-term disability as of immediately prior to the Closing Date shall be the obligation of Purchaser and its Affiliates and not of Parent and its Affiliates. (f) From and after the Closing Date, (i) Purchaser shall assume and honor, and shall cause the Transferred Companies and their Subsidiaries to honor, all unused vacation and other paid time-off days of the Transferred Company Employees that accrued prior to the Closing Date, and (ii) Purchaser shall sponsor a paid time-off policy that applies to each Transferred Company Employee and shall take into account service with Parent and its Affiliates as provided in Section 6.4(a). Notwithstanding the foregoing, in the event that Parent or one of its Affiliates is required under applicable Law to make a payment in settlement of accrued vacation or paid time off of any Transferred Company Employee, Purchaser shall reimburse and hold harmless Parent and its Affiliates for such payment to the extent such liability was reflected on the Closing Statement or Adjusted Closing Statement, as the case may be. (g) Parent and Purchaser shall take all actions necessary or appropriate so that, effective as of the Closing Date, (i) the account balances (whether positive or negative) (the “Transferred Account Balances”) under the flexible spending component of the Home Depot U.S.A., Inc. Cafeteria Benefit Plan (“Parent’s Flex Plan”) of the Transferred Company Employees who are participants in Parent’s Flex Plan (the “FSA Covered Employees”) shall be transferred to one or more comparable plans of the Purchaser (collectively, the “Purchaser’s Flex Plan”); (ii) the elections, contribution levels and coverage levels of the FSA Covered Employees shall apply under the Purchaser’s Flex Plan in the same manner as under the Parent’s Flex Plan; and (iii) the FSA Covered Employees shall be reimbursed from the Purchaser’s Flex Plan for claims which have been (A) incurred at any time during the plan year of the Parent’s Flex Plan in which the Closing Date occurs and (B) submitted to the Purchaser’s Flex Plan from and after the Closing Date, on the same basis and the same terms and conditions as under the Parent’s Flex Plan. As soon as practicable after the Closing Date, and in any event within ten (10) Business Days after the amount of the Transferred Account Balances is determined, Parent shall pay Purchaser the net aggregate amount of the Transferred Account Balances, if such amount is positive, and Purchaser shall pay Parent the net aggregate amount of the Transferred Account Balances, if such amount is negative.

Welfare Benefits Plans. (a) The Except as otherwise provided in this Section 6.2 and without limiting the generality of Section 6.1(b), the participation by Transferred Company Entity Employees in Welfare Plans that are Parent Seller Benefit Plans shall continue until the earlier of the termination of the Transition Services Agreement or December 31, 2007 (the “TSA End Date”). Effective as of the TSA End Date, Purchaser shall permit each Transferred Entity Employee, and each Former Transferred Entity Employee covered by Seller and its Affiliates under the Transferred Entity Retiree Welfare Plans as of immediately prior to the Closing Date. Effective as of the Closing Date, Purchaser shall ensure commencement of coverage for each Transferred Company Employee who was a participant in the Company’s Welfare Plans as of the Closing Date to enroll in Welfare Plans maintained by Purchaser and its Affiliates (it being understood that for this purpose are consistent with the provision of benefits to the Transferred Company Employees under the Parent Welfare Plans (as defined requirements set forth in the EBTA) during the Welfare Plan Transition Period (as defined in the EBTA) shall fulfill Purchaser’s obligations with respect to the provision of the types of welfare benefits provided under the EBTASection 6.1(c). (b) Except as otherwise provided in Sections 6.2(d) and 6.2(e), notwithstanding anything in this Article VIVI to the contrary (but subject to Section 6.2(d) and 6.2(e)), commencing as of the Closing, with respect to claims arising under any Welfare Plan that is a Seller Benefit Plan, (i) Parent Seller and its Affiliates shall be solely liable for any claims for Welfare Benefits that are (x) incurred by or with respect to any Transferred Company Entity Employee and his or her beneficiaries or dependents under a Parent Benefit Plan before the Closing DateDate and (y) incurred by or with respect to any Former Transferred Entity Employee and his or her beneficiary regardless of when incurred, and other than with respect to claims under a Transferred Entity Retiree Welfare Plan (ii) Purchaser shall be solely liable for any claims for Welfare Benefits that are incurred by or with respect to any Transferred Company Entity Employee and his or her beneficiaries or dependents on or after the Closing Date (provided that with respect to claims incurred under the Parent Welfare Plans during the Welfare Plan Transition Period, the terms of Purchaser’s liability are set forth in the EBTA)Date. For purposes of the foregoing, the following claims and liabilities a medical/dental/vision claim shall be deemed to be considered incurred as follows: (x) life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, disability or accident giving rise to such benefits; (y) hospital-provided health, dental, prescription drug or other benefits, which become payable with respect to any hospital confinement, upon commencement of such confinement; and (z) medical, dental, and vision, when the services are rendered, the supplies are provided or prescribed medication is acquired by the participantprescribed, and not when the condition arose. The manner in which such claims shall be administered shall be set forth in the Transition Services Agreement. (c) With respect to the coverage of the Transferred Company Entity Employees under Purchaser’s Welfare Plans, (i) each such employee’s credited service with Parent Seller and its Affiliates shall be credited against any waiting period applicable to eligibility for enrollment of new employees under Purchaser’s Welfare Plans; (ii) limitations on benefits due to pre-existing conditions shall be waived (or, if such a waiver is not otherwise required by applicable Laws, Purchaser shall use commercially reasonable efforts to have them waived), to the extent waived under the corresponding Benefit Plan of the Seller, for any Transferred Company Entity Employee enrolled in any Welfare Plan maintained by Parent Seller and its Affiliates (which shall include for this purpose the Parent Welfare Plans in which a Transferred Company Employee participated during the Welfare Plan Transition Period) as of the Welfare Plan Transition Period Closing Date (or if later, the TSA End Date to the extent waived under such plansDate); and (iii) any out-of-pocket annual maximums and deductibles taken into account under the Parent Seller Group Health Plan for any Transferred Company Entity Employee in the plan calendar year that which contains the Welfare Plan Transition Period Closing Date (or if later, the TSA End Date Date) shall be credited under Purchaser’s Welfare Plans for the same calendar year. With respect to aggregate lifetime maximum benefits available under Purchaser’s Welfare Plans, a Transferred Company Employee’s prior claim experience under any of the component programs of the Welfare Plan maintained by Parent and its Affiliates will not be taken into account. (d) Effective as of the Closing Date, Purchaser shall be responsible for, and shall assume all liability with respect to, for providing the notices and making available the health care continuation coverage, all as required by Section 4980B of the Code, COBRA Continuation Coverage for all of the Transferred Company Entity Employees and their respective covered dependentsdependents whose qualifying events (as defined in Code Section 4980B) occur on or after the TSA End Date. Seller shall continue to be responsible for providing the notices and making available COBRA Continuation Coverage, for (i) (x) all of the Former Transferred Entity Employees and their respective covered dependents and (y) all Transferred Entity Employees, and their respective covered dependents whose qualifying events (as defined in Code Section 4980B) occur prior to the Closing Date and (ii) all Transferred Entity Employees and their respective covered dependents whose qualifying events (as defined in Code Section 4980B) occur on or after the Closing Date (it being understood that for this purpose and prior to the Purchaser’s satisfaction of its obligations TSA End Date, provided that, with respect to the individuals described in clause (ii), Purchaser shall be responsible for any liabilities that may result from, arise under or be incurred in connection with the provision of COBRA coverage during Continuation Coverage in accordance with the Welfare Plan terms of the Transition Period Services Agreement and, as set forth in of the EBTA TSA End Date, Purchaser shall fulfill provide such COBRA Continuation Coverage under Purchaser’s obligations under this Section 6.2(d))Welfare Plans; provided, however, that Seller and its Affiliates shall provide Purchaser with the records necessary to identify and administer such responsibilities. (e) Notwithstanding anything in this Agreement to the contrary, (i) if any Transferred Company Entity Employee has become disabled (within the meaning of the applicable short-term and/or long-term disability plan of Parent Seller and its Affiliates) on or subsequent to the Closing Date but on or prior to the Closing TSA End Date, any short-term and/or long-term disability salary continuation income benefits relating to such disability shall be paid under the terms of such shortshort or long-term disability program plan as in effect immediately through prior to the Closing TSA End Date (subject to Purchaser’s responsibility for the cost of such benefits as contemplated by Section 6.2(b) and the Transition Services Agreement) and, following the Closing TSA End Date, shall be the sole responsibility of Purchaser. Notwithstanding anything in this Agreement to the contrary, and (ii) Purchaser shall be solely responsible for short-term disability salary continuation income benefits of if any Transferred Company Entity Employee (or new employee of the Business) who becomes disabled during the Welfare Plan Transition Period. Any Transferred Company Employee who becomes has become disabled (within the meaning of the applicable Welfare Plan maintained by Seller or its Affiliates that provides short-term or long-term disability plan of the Parentbenefits) while covered by such plan on or prior to the Closing Date, Seller and/or Seller’s Affiliates will retain liability for the provision of disability benefits payable to such employee under Seller’s Welfare Plan Transition Period End Date shall be eligible for benefits under the terms Plans, if any, with respect to such disability (but not with respect to any reoccurrence of such plana disability after such employee returns to active service with a Transferred Entity on or following the Closing Date). From and after the Closing Date, any right to reemployment for any Transferred Company Entity Employees who are on short-term or long-term disability as of immediately prior to the Closing Date shall be the obligation of Purchaser and its Affiliates and not of Parent Seller and its Affiliates. (f) From and after the Closing Date, (i) Purchaser shall assume and honor, and honor or shall cause the Transferred Companies Entities to assume and their Subsidiaries to honor, all unused vacation and other paid time-time off days of the Transferred Company Entity Employees that accrued prior to the Closing Date in the calendar year which contains the Closing Date, and (ii) Purchaser shall sponsor a paid time-time off policy that applies to each Transferred Company Entity Employee and shall take into account service with Parent Seller and its Affiliates as provided in Section 6.4(a). Notwithstanding the foregoing, in the event that Parent or one of its Affiliates is required under applicable Law With respect to make a payment in settlement of accrued vacation or unused paid time off days of the Transferred Entity Employees that accrued in any Transferred Company Employee, Purchaser shall reimburse and hold harmless Parent and its Affiliates for such payment calendar year ending prior to the extent such liability was reflected on the Closing Statement or Adjusted Closing Statement, as the case may be. (g) Parent and Purchaser shall take all actions necessary or appropriate so that, effective as of the Closing Date, (i) the account balances (whether positive or negative) (the “each Transferred Account Balances”) under the flexible spending component of the Home Depot U.S.A., Inc. Cafeteria Benefit Plan (“Parent’s Flex Plan”) of the Transferred Company Employees who are participants in Parent’s Flex Plan (the “FSA Covered Employees”) Entity Employee shall be transferred to one paid by Seller or more comparable plans of the Purchaser (collectively, the “Purchaser’s Flex Plan”); (ii) the elections, contribution levels and coverage levels of the FSA Covered Employees shall apply under the Purchaser’s Flex Plan its Affiliates in the same manner cash on or as under the Parent’s Flex Plan; and (iii) the FSA Covered Employees shall be reimbursed from the Purchaser’s Flex Plan for claims which have been (A) incurred at any time during the plan year of the Parent’s Flex Plan in which the Closing Date occurs and (B) submitted to the Purchaser’s Flex Plan from and after the Closing Date, on the same basis and the same terms and conditions as under the Parent’s Flex Plan. As soon as practicable after the Closing DateDate for the number of such unused accrued paid time off days, to the extent credited under the paid time off policy of Seller and in any event within ten its Affiliates. (10g) Business Days after Purchaser shall provide Transferred Entity Employees whose employment is terminated during the amount twelve-month period ending on the first anniversary of the Transferred Account Balances is determined, Parent shall Closing Date severance pay Purchaser and benefits on the net aggregate amount terms and conditions set forth in Section 6.2(g) of the Transferred Account BalancesSeller Disclosure Schedule. Notwithstanding the foregoing, if such amount is positive, Purchaser and Purchaser shall pay Parent the net aggregate amount of the Transferred Account Balances, if such amount is negativeEntities shall not be under any obligation to continue the employment of any individual for any period of time following the Closing as a result of any provision of this Agreement.

Welfare Benefits Plans. (a) The participation by Transferred Company Employees Upon termination of the welfare benefit services provided under the Transition Services Agreement, Buyer shall permit each Employee to enroll in Welfare Plans maintained by Buyer or its Affiliates that are Parent Benefit Plans shall continue until immediately provide benefits substantially consistent with those provided by Sellers and the Companies prior to the Closing Date. Effective as of the Closing Date, Purchaser shall ensure commencement of coverage for each Transferred Company Employee who was a participant in the Company’s Welfare Plans as of the Closing Date in Welfare Plans maintained by Purchaser and its Affiliates (it being understood that for this purpose the provision of benefits to the Transferred Company Employees under the Parent Welfare Plans (as defined in the EBTA) during the Welfare Plan Transition Period (as defined in the EBTA) shall fulfill Purchaser’s obligations with respect to the provision of the types of welfare benefits provided under the EBTA). (b) Except as otherwise provided in this Article VI, (i) Parent and its Affiliates shall be solely liable for any claims for Welfare Benefits that are incurred by or with respect to any Transferred Company Employee and his or her beneficiaries or dependents under a Parent Benefit Plan before the Closing Date, and (ii) Purchaser shall be solely liable for any claims for Welfare Benefits that are incurred by or with respect to any Transferred Company Employee and his or her beneficiaries or dependents on or after the Closing Date (provided that with respect to claims incurred under the Parent Welfare Plans during the Welfare Plan Transition Period, the terms of Purchaser’s liability are set forth in the EBTA). For purposes of the foregoing, the following claims and liabilities shall be deemed to be incurred as follows: (x) life, accidental death and dismemberment and business travel accident insurance benefits, upon the death, disability or accident giving rise to such benefits; (y) hospital-provided health, dental, prescription drug or other benefits, which become payable with respect to any hospital confinement, upon commencement of such confinement; and (z) medical, dental, and vision, when the services are rendered, the supplies are provided or prescribed medication is acquired by the participant, and not when the condition arose. (c) With respect to the coverage of the Transferred Company Employees and their eligible beneficiaries and covered dependents under Purchaser’s the Welfare PlansPlans provided by Buyer or its Affiliates, (i) each such employeeEmployee’s credited service with Parent the Sellers, the Companies and its their Affiliates shall be credited against any waiting period applicable to eligibility for enrollment of new employees under Purchaser’s the Welfare Plans; and (ii) limitations on benefits due to pre-existing conditions shall be waived (or, if such a waiver is not otherwise required by applicable Laws, Buyer shall use commercially reasonable efforts to have them waived), to the extent waived under the corresponding Benefit Plan of the Sellers and their Affiliates, for any Transferred Company Employee enrolled in any Welfare Plan maintained by Parent the Sellers and its their Affiliates (which shall include for this purpose the Parent Welfare Plans in which a Transferred Company Employee participated during the Welfare Plan Transition Period) as of the Welfare Plan Transition Period End Date to the extent waived under such plans; Effective Time, and (iii) any out-of-pocket annual maximums for their eligible beneficiaries and deductibles taken into account under the Parent Group Health Plan for any Transferred Company Employee in the plan year that contains the Welfare Plan Transition Period End Date shall be credited under Purchaser’s Welfare Plans for the same year. With respect to aggregate lifetime maximum benefits available under Purchaser’s Welfare Plans, a Transferred Company Employee’s prior claim experience under any of the component programs of the Welfare Plan maintained by Parent and its Affiliates will not be taken into accountcovered dependents. (dc) Effective as Subject to the provisions of the Closing DateTransition Services Agreement and Co-Employer Agreement, Purchaser Buyer shall be responsible for, and shall assume all liability with respect to, for providing the notices and making available COBRA continuation coverage for all Employees and their respective covered dependents whose qualifying events (as defined in Code Section 4980B) occur after the health care Closing Date. The Sellers shall continue to be responsible for providing the notices and making available COBRA continuation coverage, all as required by Section 4980B of the Code, for all of the Transferred Company Former Employees and their respective covered dependents, dependents whose qualifying events (as defined in Code Section 4980B) occur on or after prior to the Closing Date (it being understood that for this purpose the Purchaser’s satisfaction of its obligations with respect to COBRA coverage during the Welfare Plan Transition Period as set forth in the EBTA shall fulfill Purchaser’s obligations under this Section 6.2(d))Date. (ed) Notwithstanding anything in this Agreement to the contrary, (i) if any Transferred Company Employee has become disabled (within the meaning of the applicable Welfare Plan maintained by the Sellers or their Affiliates that provides short-term or long-term disability plan of Parent and its Affiliatesbenefits) on or prior to the Closing Date, any short-term the Sellers and/or their Affiliates will retain liability for the provision of disability salary continuation income benefits relating payable to such disability shall be paid Employee under the terms of Sellers’ Welfare Plans, if any, with respect to such short-term disability program as in effect immediately through the Closing Date and, following the Closing Date, shall be the sole responsibility of Purchaser, and (ii) Purchaser shall be solely responsible for short-term disability salary continuation income benefits of any Transferred Company Employee (or new employee of the Business) who becomes disabled during the Welfare Plan Transition Period. Any Transferred Company Employee who becomes disabled (within the meaning of the applicable long-term disability plan of the Parent) while covered by such plan on or prior to the Welfare Plan Transition Period End Date shall be eligible for benefits under the terms of such plandisability. From and after the Closing Date, any right to reemployment for any Transferred Company Employees Employee who are is on short-term or long-term disability as of immediately prior to the Closing Date shall be the obligation of Purchaser Buyer and its Affiliates (including the Companies) and not of Parent the Sellers and its their Affiliates. (f) From and after , so long as such reemployment occurs within the Closing Date, longer of (i) Purchaser shall assume and honor, and shall cause the Transferred Companies and their Subsidiaries to honor, all unused vacation and other paid time-off 180 days of the Transferred Company Employees that accrued prior to the Closing Date, Date and (ii) Purchaser any statutorily prescribed period during which such Employee is entitled to reemployment. (e) Buyer shall sponsor a paid time-off policy that applies to each Transferred Company Employee assume and shall take into account service with Parent and its Affiliates as provided in Section 6.4(a). Notwithstanding the foregoing, in the event that Parent or one of its Affiliates is required under applicable Law to make a payment in settlement of accrued vacation or honor all unused paid time off of any Transferred Company Employee, Purchaser shall reimburse and hold harmless Parent and its Affiliates for such payment to held by the extent such liability was reflected on the Closing Statement or Adjusted Closing Statement, as the case may be. (g) Parent and Purchaser shall take all actions necessary or appropriate so that, effective Employees as of the Closing Date, (i) the account balances (whether positive or negative) (the “Transferred Account Balances”) under the flexible spending component of the Home Depot U.S.A., Inc. Cafeteria Benefit Plan (“Parent’s Flex Plan”) of the Transferred Company Employees who are participants in Parent’s Flex Plan (the “FSA Covered Employees”) shall be transferred to one or more comparable plans of the Purchaser (collectively, the “Purchaser’s Flex Plan”); (ii) the elections, contribution levels and coverage levels of the FSA Covered Employees shall apply under the Purchaser’s Flex Plan in the same manner as under the Parent’s Flex Plan; and (iii) the FSA Covered Employees shall be reimbursed from the Purchaser’s Flex Plan for claims which have been (A) incurred at any time during the plan year of the Parent’s Flex Plan in which the Closing Date occurs and (B) submitted to the Purchaser’s Flex Plan from and after the Closing Date, on the same basis and the same terms and conditions as under the Parent’s Flex Plan. As soon as practicable after the Closing Date, and in any event within ten (10) Business Days after the amount of the Transferred Account Balances is determined, Parent shall pay Purchaser the net aggregate amount of the Transferred Account Balances, if such amount is positive, and Purchaser shall pay Parent the net aggregate amount of the Transferred Account Balances, if such amount is negative.