EXCLUDING FOR THIS PURPOSE
TRANSACTION BONUSES, WITH THE TERMS AND CONDITIONS UNDER WHICH THE TRANSFERRED
EMPLOYEES WERE EMPLOYED IMMEDIATELY BEFORE THE CLOSING DATE.
ANY AFFECTED
EMPLOYEE WHO IS ON SHORT-TERM DISABILITY LEAVE AS OF THE CLOSING DATE SHALL
REMAIN EMPLOYED BY SELLERS THROUGH THE AFFECTED EMPLOYEE'S SHORT-TERM DISABILITY
LEAVE; PROVIDED, HOWEVER, THAT IF HE OR SHE RECOVERS FROM HIS OR HER DISABILITY
WITHIN THE PERIOD OF HIS OR HER SHORT-TERM DISABILITY LEAVE OR THE SIX-MONTH
PERIOD FOLLOWING THE CLOSING DATE (WHICHEVER IS SHORTER), BUYER SHALL AT THAT
TIME MAKE AN OFFER OF
47
employment to him or her on the same employment terms and conditions as are
applicable to similarly situated Transferred Employees, subject to the proviso
above.
(B)
SELLERS SHALL BE RESPONSIBLE FOR THE PAYMENT
OF ALL WAGES AND OTHER REMUNERATION ACCRUING TO ANY AFFECTED EMPLOYEE PRIOR TO
THE TIME ANY SUCH AFFECTED EMPLOYEE BECAME A TRANSFERRED EMPLOYEE, EXCEPT TO THE
EXTENT THE LIABILITY THEREFOR IS REFLECTED AS A LIABILITY ON THE CLOSING BALANCE
SHEET.
(C)
SELLERS SHALL BE LIABLE FOR ALL CLAIMS MADE
BY AFFECTED EMPLOYEES AND THEIR BENEFICIARIES UNDER AND ALL OTHER LIABILITIES OF
THE SELLER BENEFIT PLANS.
(D)
COVERAGE FOR TRANSFERRED EMPLOYEES UNDER ALL
"EMPLOYEE WELFARE BENEFIT PLANS," AS DEFINED IN SECTION 3(1) OF ERISA,
MAINTAINED BY SELLERS SHALL CEASE AS OF THE EFFECTIVE TIME.
SELLERS SHALL BE
SOLELY RESPONSIBLE FOR ANY CONTINUATION COVERAGE REQUIRED BY COBRA FOR THOSE
AFFECTED EMPLOYEES OF SELLERS WHO ARE NOT TRANSFERRED EMPLOYEES.
BUYER SHALL
WAIVE ALL PRE-EXISTING CONDITIONS, LIMITATIONS OR EXCLUSIONS AND WAITING PERIODS
FOR THE TRANSFERRED EMPLOYEES UNDER ALL EMPLOYEE WELFARE BENEFIT PLANS AND
FRINGE BENEFIT PROGRAMS OF BUYER, INCLUDING VACATION, BONUS AND OTHER INCENTIVE
PROGRAMS MAINTAINED BY BUYER.
(E)
SELLERS SHALL RETAIN ALL ASSETS IN THE
PENSION AND RETIREMENT FUNDS OF SELLERS, AND SHALL DISTRIBUTE PENSION AND
RETIREMENT BENEFITS THAT THE TRANSFERRED EMPLOYEES SHALL BECOME ENTITLED TO
RECEIVE FROM SELLERS IN ACCORDANCE WITH THE APPLICABLE PLAN DOCUMENT AND THE
TRANSFERRED EMPLOYEES' ELECTIONS, AS APPLICABLE; PROVIDED, HOWEVER, THAT
EFFECTIVE AS OF THE EFFECTIVE TIME, TO THE EXTENT REQUIRED BY LEGAL REQUIREMENT,
SELLERS SHALL AMEND THE STEWART & STEVENSON SERVICES, INC. DEFINED BENEFIT
PENSION PLAN AND ANY OTHER SELLER BENEFIT PLAN THAT IS A "PENSION PLAN," AS
DEFINED IN SECTION 3(2) OF ERISA, TO PROVIDE THAT EACH TRANSFERRED EMPLOYEE'S
BENEFIT THAT HAS ACCRUED AS OF THE CLOSING DATE IS FULLY VESTED AND
NONFORFEITABLE AS OF THE CLOSING DATE.
(F)
EFFECTIVE AS OF THE CLOSING DATE (OR AS
TO EMPLOYEES ON SHORT-TERM DISABILITY LEAVE ON THE CLOSING DATE, AS OF THE DATE
OF EMPLOYMENT BY BUYER), BUYER SHALL TAKE SUCH ACTIONS AS ARE NECESSARY TO GRANT
PAST SERVICE CREDIT FOR ALL THE TRANSFERRED EMPLOYEES FOR PURPOSES OF
DETERMINING VESTING, ELIGIBILITY AND BENEFIT ACCRUALS UNDER ALL BUYER'S EMPLOYEE
BENEFIT PROGRAMS IN WHICH TRANSFERRED EMPLOYEES ARE ELIGIBLE TO PARTICIPATE,
INCLUDING EMPLOYEE RETIREMENT PLANS, SEVERANCE, VACATION, BONUS, INCENTIVE
COMPENSATION AND EMPLOYEE WELFARE BENEFIT PLANS OF BUYER EQUAL TO THAT WHICH
SUCH TRANSFERRED EMPLOYEES WERE CREDITED WITH BY SELLERS AS OF THE CLOSING DATE