This excerpt taken from the MSCC 8-K filed Nov 7, 2005.
5.12. Employee Benefit Plans.
(a) 401(k) Plan. The Company shall take the following steps with respect to the ADVANCED POWER TECHNOLOGY, INC. Salary Savings Plan (401(k) Plan): at least three days prior to the Effective Time, the Company shall terminate the 401(k) Plan pursuant to written resolutions, the form and substance of which shall be satisfactory to Parent. Individuals employed by the Company at the Effective Time (Company Employees) shall be allowed to participate in Parents 401(k) plan effective as of the first payroll following the Effective Time; and all service with the Company shall be considered service with Parent for purposes of determining eligibility, vesting, and benefit accrual (i.e., any matching contributions) under Parents 401(k) plan. As soon as administratively feasible after assets are distributed from the 401(k) Plan, Company Employees shall be offered an opportunity to roll their 401(k) Plan account balances into Parents 401(k) Plan.
(b) Welfare Plans. Company Employees shall be eligible to participate in Parents disability plans, group life insurance plan, medical plan, dental plan, and Section 125 cafeteria plan as soon as administratively feasible after the Effective Time. Prior to such time, Company Employees shall remain eligible for the Companys welfare plans, as applicable, and such plans will not be amended or changed in any material respect by Parent or the Company. Parent shall include service and prior earnings with the Company for purposes of determining eligibility, participation, and benefit accrual under its short term disability plan, group life insurance plan medical plan, dental plan, and Section 125 cafeteria plan. Parent shall include such service for purposes of determining benefit eligibility or participation in Parents disability plans; however, such participation shall be subject to any applicable preexisting condition exclusions.
(c) Vacation and PTO. Company Employees shall be eligible to participate in Parents vacation or paid time off (PTO) policy, as applicable, as soon as administratively feasible after the Effective Time. Prior to such date Company Employees shall remain eligible for the Companys vacation pay or sick pay policies, as applicable, and such plans or policies will not be
amended or changed in any material respect by Parent or the Company. Parent shall include service with the Company for purposes of determining eligibility, participation, and calculation of vacation pay, sick pay, or PTO under Parents vacation or PTO policy, as applicable. Subject to the terms of the Company plans or policies, each Company Employee will be entitled to carry over all vacation days and sick leave accrued but unused as of the Effective Time.
(d) Incentive Bonus Plan. The Companys Incentive Bonus Plan shall be kept in place until December 31, 2005, after which time Company Employees may be eligible to participate in any incentive program established by Parent from time to time.
5.13. Determination of Optionholders. At least thirty (30) business days before the Effective Time, the Company shall provide Parent with a true and complete list, as of such date, of (a) the holders of Company Options, (b) the number of shares of Company Common Stock subject to Company Options held by each such optionholder and (c) the address of each such optionholder as set forth in the books and records of the Company or any Subsidiary, following upon which there shall be no additional grants of Company Options without Parents prior written consent. From the date such list is provided to Parent until the Effective Time, the Company shall provide option activity reports to Parent twice monthly containing such information as Parent shall reasonably request and shall provide an update of such information at and as of the Effective Time.
5.14. Preparation of Tax Returns. The Company shall file (or cause to be filed) at its own expense, on or prior to the due date thereof, all Returns required to be filed on or before the Closing Date. The Company shall provide Parent with a copy of appropriate work papers, schedules, drafts and final copies of each foreign and domestic, federal, provincial and state income Tax return or election of the Company (including returns of all Employee Benefit Plans) at least ten days before filing such return or election and shall consult with Parent with respect thereto prior to such filing.
5.15. Tax-Free Reorganization. Parent and the Company shall each use all commercially reasonable best efforts to cause the Merger to qualify as a reorganization within the meaning of Section 368(a) of the Code. Neither Parent nor the Company shall take or fail to take, or cause any third party to take or fail to take, any action that would cause the Merger to fail to qualify as a reorganization within the meaning of Section 368(a) of the Code.
5.16. SEC Filings; Compliance. The Company and Parent shall each cause the forms, reports, schedules, statements and other documents required to be filed with the SEC by the Company and Parent, respectively, between the date of this Agreement and the Effective Time (with respect to either the Company or Parent, the New SEC Reports) to be prepared in all material respects with all applicable requirements of the Securities Act and the Exchange Act, as the case may be, and such New SEC Reports will not at the time they are filed contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading.
5.17. Listing of Additional Shares. Prior to the Effective Time, Parent shall file with the Nasdaq National Market a Notification Form 10b-17 for Listing Additional Shares with respect to the shares of Parent Common Stock to be issued in the Merger.
5.18. Environmental Investigation. The Parent shall arrange for and direct environmental investigations of soil and groundwater, with the assistance and cooperation of Company, in, under
or about properties operated, now or previously, by Company or its Subsidiaries. Company shall use commercially reasonable efforts to provide Parent adequate access to any and all such properties. Company shall provide Parent documentation of any and all insurance policies, indemnities, judgments, orders or agreements respecting liability under any Environmental Laws.
5.19. Delivery of Ancillary Documents. The Company shall use its commercially reasonable best efforts to deliver the Employment Agreements, Lock-up Agreements and the Voting Agreements, fully-executed by the parties thereto other than the Parent, within ten (10) business days following the execution of this agreement.