Common use of Agreements Regarding Tax Matters Clause in Contracts

Agreements Regarding Tax Matters. (a) Prior to the Closing Date, the Sellers’ Representative and NEWCO shall agree on an allocation of the total Purchase Price among HEC’s assets (the “Allocation”). The Allocation will consider the principles of applicable Internal Revenue Service guidance, including the possibility of asymmetric treatment of the Parties. If the Sellers’ Representative and NEWCO are unable to reach agreement on the Allocation by the Closing Date, the Allocation shall be submitted to and determined by the Referee. The Referee shall determine the elements of the Allocation as are disputed within thirty (30) days after the issues are submitted to the Referee, but in each case in accordance with applicable legal principles. If any objections are submitted to the Referee for resolution, (i) each of NEWCO and the Sellers’ Representative shall furnish to the Referee such workpapers and other documents and information relating to such objections as the Referee may request and are available to that Party or its Affiliates (or its independent public accountants) and will be afforded the opportunity to present to the Referee any material relating to the determination of the matters in dispute and to discuss such determination with the Referee prior to any written notice of determination hereunder being delivered by the Referee; (ii) to the extent that a value has been assigned by NEWCO or the Sellers’ Representative to any item that is submitted to the Referee, the Referee shall not assign a value to such objection that is greater than the greatest value for such objection claimed by either such Party or less than the smallest value for such objection claimed by either such Party; (iii) the determination by the Referee of the calculation of the Allocation as set forth in a written notice delivered to NEWCO and the Sellers’ Representative by the Referee, shall be binding and conclusive on the Parties and shall constitute an arbitral award that is final, binding and unappealable and upon which a judgment may be entered by a court having jurisdiction thereof; (iv) the fees and expenses of the Referee shall be paid by NEWCO in the event that NEWCO’s assertions regarding the Allocation differ by a greater amount from the amount determined by Referee, or by the HEC Members in the event that the Sellers’ Representative’s assertions regarding the Allocation differ by the greater amount from the amount determined by the Referee. Once finalized, the Allocation shall be binding upon all Parties to this Contribution Agreement and NEWCO and the HEC Members shall report, act and file all Tax Returns, including any amended Tax Returns, in all respects and for all purposes consistent with the Allocation. No Party shall take any position (whether in audits, on Tax Returns or otherwise) that is inconsistent with the Allocation unless required to do so by Law or, following good faith consultation with the other Parties, in connection with the settlement of a Tax Controversy; provided that each Party shall be entitled to apply such statutory or regulatory allocation provisions as are applicable to such Party. (b) For any HEC Tax period ending on or before the Closing Date, the Sellers’ Representative shall prepare or cause to be prepared (in a manner consistent with past practice to the extent consistent with applicable Law), and file or cause to be filed (including causing NEWCO to file) with the appropriate taxing authorities all Tax Returns required to be filed with respect to HEC on or prior to the Closing Date (taking into account extensions) and all Tax Returns for income Taxes or franchise Taxes for any HEC Tax period ending on or before the Closing Date for which the HEC Members are responsible, regardless of when required to be filed (collectively, “Pre-Closing Tax Returns”). At NEWCO’s request, HEC shall make or cause to be made an election under Section 754 of the Code with respect to the Tax period ended on the Closing Date. Any amounts payable by HEC in connection with such Pre-Closing Tax Returns shall be paid by HEC. Any amounts payable by the HEC Members in connection with any such Pre-Closing Tax Returns for income or franchise Taxes shall be paid by such HEC Members. NEWCO shall have the right to review all Pre-Closing Tax Returns at least fifteen (15) days (or, in the case of Tax Returns other than Tax Returns for income or franchise Taxes for which the HEC Members are responsible, as many days as reasonably practical) prior to the timely filing thereof, and the Parties agree to consult and resolve in good faith any issue arising as a result of the review of such Pre-Closing Tax Returns; provided that the Sellers’ Representative shall have final control in the case of Pre-Closing Tax Returns for income or franchise Taxes for which the HEC Members are responsible, except to the extent the positions taken therein are contrary to Law or to the provisions of this Contribution Agreement; and provided, further, that the Sellers’ Representative shall make any changes to a Pre-Closing Tax Return that are reasonably requested by NEWCO and will have no material adverse effect upon any HEC Member. (c) For any HEC Tax period that begins on or before and ends after the Closing Date (“Straddle Period”), NEWCO shall timely prepare or cause to be prepared, and file or cause to be filed (in a manner consistent with past practices to the extent consistent with applicable Law) with the appropriate taxing authorities all Tax Returns required to be filed with respect to HEC (“Straddle Returns”) and shall pay all Taxes due with respect to such Straddle Returns. The Sellers’ Representative shall have the right to review any such Straddle Returns at least fifteen (15) days (or, in the case of Tax Returns other than Tax Returns for income or franchise Taxes for which the HEC Members are responsible, as many days as reasonably practical) prior to the timely filing of such Straddle Returns, and the Parties agree to consult and resolve in good faith any issue arising as a result of the review of any such Straddle Returns. (d) All transfer, documentary, sales, use, registration, value-added and other similar Taxes (including all applicable real estate transfer Taxes) and related fees (including any penalties, interest and additions to Tax) (collectively, “Transfer Taxes”) incurred in connection with the transactions expressly contemplated hereby shall be paid one-half by NEWCO and one-half by the HEC Members. The Parties agree to cooperate and utilize their commercially reasonable efforts to minimize the Transfer Taxes associated with the transactions contemplated by this Contribution Agreement. (e) NEWCO and the HEC Members will cooperate fully, as and to the extent reasonably requested by the other such Party, in connection with any audit, litigation or other proceeding with respect to Taxes in relation to the transactions contemplated hereby (each a “Tax Controversy”), and in connection with the preparation and filing of any Tax Return, or amendment thereto. Such cooperation will include the retention and (upon the other such Party’s written request) the provision of records and information reasonably relevant to any such audit, litigation or other proceeding, or any such Tax Return or amendment thereto, and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder; provided, however, that no such Party shall be required to retain any Tax Returns, supporting workpapers, or other records beyond a time that is thirty (30) days after the expiration of the applicable statute of limitations with respect to a Tax. NEWCO and the HEC Members further agree, upon request, to use their reasonable efforts to obtain any certificate, including any resale or similar certificate, or other document from any Person as may be reasonably necessary to mitigate, reduce or eliminate any Tax that could be imposed (including with respect to the transactions contemplated by this Contribution Agreement). Without limiting the foregoing, the Sellers’ Representative shall control any Tax Controversy with respect to Pre-Closing Tax Returns or Straddle Returns relating to income or franchise Taxes that are payable by the HEC Members, provided that NEWCO shall be entitled to participate in such Tax Controversy (at NEWCO’s own expense) and shall be afforded current access to all correspondence and information in connection therewith, and provided further that the Sellers’ Representative shall not be entitled to settle any such Tax Controversy in a manner that would materially and adversely impact NEWCO without the prior written consent of NEWCO, which consent shall not be unreasonably withheld.

Agreements Regarding Tax Matters. (a) Prior to the Closing Date, the Sellers’ Representative and NEWCO Each Party shall agree on an allocation of the total Purchase Price among HEC’s assets (the “Allocation”). The Allocation will consider the principles of applicable Internal Revenue Service guidance, including the possibility of asymmetric treatment of the Parties. If the Sellers’ Representative and NEWCO are unable to reach agreement on the Allocation by the Closing Date, the Allocation shall be submitted to and determined by the Referee. The Referee shall determine the elements of the Allocation as are disputed within thirty (30) days after the issues are submitted to the Referee, but in each case in accordance with applicable legal principles. If any objections are submitted to the Referee for resolution, (i) each of NEWCO and the Sellers’ Representative shall furnish to the Referee such workpapers and other documents and information relating to such objections as the Referee may request and are available to that Party or its Affiliates (or its independent public accountants) and will be afforded the opportunity to present to the Referee any material relating to the determination of the matters in dispute and to discuss such determination reasonably cooperate with the Referee prior to other Party in connection with the filing of any written notice of determination hereunder being delivered by the Referee; (ii) to the extent that a value has been assigned by NEWCO or the Sellers’ Representative to any item that is submitted to the Referee, the Referee shall not assign a value to such objection that is greater than the greatest value for such objection claimed by either such Party or less than the smallest value for such objection claimed by either such Party; (iii) the determination by the Referee of the calculation of the Allocation as set forth in a written notice delivered to NEWCO and the Sellers’ Representative by the Referee, shall be binding and conclusive on the Parties and shall constitute an arbitral award that is final, binding and unappealable and upon which a judgment may be entered by a court having jurisdiction thereof; (iv) the fees and expenses of the Referee shall be paid by NEWCO in the event that NEWCO’s assertions regarding the Allocation differ by a greater amount from the amount determined by Referee, or by the HEC Members in the event that the Sellers’ Representative’s assertions regarding the Allocation differ by the greater amount from the amount determined by the Referee. Once finalized, the Allocation shall be binding upon all Parties to this Contribution Agreement and NEWCO and the HEC Members shall report, act and file all Tax Returns, including any amended Tax Returnsrelated to, or arising as a result of, the transactions contemplated in all respects and for all purposes consistent with the Allocation. No Party shall take any position (whether in audits, on Tax Returns or otherwise) that is inconsistent with the Allocation unless required to do so by Law or, following good faith consultation with the other Parties, in connection with the settlement of a Tax Controversy; provided that each Party shall be entitled to apply such statutory or regulatory allocation provisions as are applicable to such Partythis Agreement. (b) For any HEC Tax period ending The Seller shall pay all state and local Taxes (other than taxes on or before the Closing Date, the Sellers’ Representative shall prepare or cause net overall income) that are required to be prepared paid in respect of any transfer, sales, use, recording, value-added or similar state and local Taxes (in a manner consistent with past practice to other than taxes on net overall income) that may be imposed by reason of the extent consistent with applicable Lawsale, assignment, transfer and delivery of the Acquired Business (“Transfer Taxes”), and . The Seller will timely file or cause to be filed (including causing NEWCO to file) with the appropriate taxing authorities all Tax Returns required to be filed with respect to HEC on or prior to the Closing Date (taking into account extensions) and all Tax Returns for income Taxes or franchise Taxes for any HEC Tax period ending on or before the Closing Date for which the HEC Members are responsible, regardless of when required to be filed (collectively, “Pre-Closing Tax Returns”). At NEWCO’s request, HEC shall make or cause to be made an election under Section 754 of the Code with respect to the Tax period ended on the Closing Date. Any amounts payable by HEC it in connection with such Pre-Closing Tax Returns shall be paid by HEC. Any amounts payable by the HEC Members in connection with any such Pre-Closing Tax Returns for income or franchise Taxes shall be paid by such HEC Members. NEWCO shall have the right to review all Pre-Closing Tax Returns at least fifteen (15) days (or, in the case of Tax Returns other than Tax Returns for income or franchise Taxes for which the HEC Members are responsible, as many days as reasonably practical) prior to the timely filing thereof, and the Parties agree to consult and resolve in good faith any issue arising as a result of the review payment of such Pre-Closing Tax Returns; provided that the Sellers’ Representative shall have final control in the case of Pre-Closing Tax Returns for income or franchise Taxes for which the HEC Members are responsible, except to the extent the positions taken therein are contrary to Law or to the provisions of this Contribution Agreement; and provided, further, that the Sellers’ Representative shall make any changes to a Pre-Closing Tax Return that are reasonably requested by NEWCO and will have no material adverse effect upon any HEC MemberTransfer Taxes. (c) For any HEC Tax period that begins on or before and ends No later than ninety (90) days after the Closing Date Date, the Buyer shall deliver to Seller a statement (the “Straddle PeriodAllocation Statement”), NEWCO allocating the Purchase Price, Assumed Liabilities and other relevant items among the Acquired Business in accordance with Section 1060 of the Code and the regulations thereunder. Within thirty (30) days of delivery of the Allocation Statement, Seller shall timely prepare or cause notify the Buyer of any proposed changes to be preparedthe Allocation Statement. The Parties shall attempt in good faith to agree to the Allocation Statement, but if the Parties cannot agree on the Allocation Statement within ten (10) days after notification of a dispute by Seller, then upon the request of any Party, the Parties will resolve the dispute by way of arbitration by an independent accounting firm mutually agreed upon by Xxxxx and Seller, provided that the fees, expenses, and file or cause to costs of the independent accounting firm arbitrator shall be filed (borne equally by the Buyer, on the one hand, and Seller, on the other hand. The Parties shall make consistent use of the allocation as finally determined under this Section 4.3(c) for all Tax purposes and in a manner consistent with past practices to the extent consistent with applicable Law) all filings, declarations and reports with the appropriate taxing authorities all Tax Returns IRS in respect thereof, including the reports required to be filed under Section 1060 of the Code. In connection with respect to HEC (“Straddle Returns”) and shall pay all Taxes due with respect to such Straddle Returns. The Sellers’ Representative shall have the right to review any such Straddle Returns at least fifteen (15) days (or, in the case of Tax Returns other than Tax Returns for income claim or franchise Taxes for which the HEC Members are responsible, as many days as reasonably practical) prior proceeding related to the timely filing of such Straddle Returns, and the Parties agree to consult and resolve in good faith any issue arising as a result of the review determination of any Tax, neither Buyer nor Seller shall contend or represent that such Straddle Returnsallocation is not a correct allocation, unless otherwise required by Law. (d) All transfer, documentary, sales, use, registration, value-added and other similar Taxes (including all applicable real estate transfer Taxes) and related fees (including any penalties, interest and additions to Tax) (collectively, “Transfer Taxes”) incurred in connection with the transactions expressly contemplated hereby shall be paid one-half by NEWCO and one-half by the HEC Members. The Parties agree to cooperate that the Acquired Business shall be acquired for income tax purposes on the Closing Date for all U.S. federal (and utilize their commercially reasonable efforts to minimize the Transfer Taxes associated with the transactions contemplated by this Contribution Agreement. (eapplicable state and local) NEWCO income tax purposes, and the HEC Members will cooperate fully, as and neither Party shall take any position contrary to the extent reasonably requested by the other such Party, in connection with foregoing on any audit, litigation or other proceeding with respect to Taxes in relation to the transactions contemplated hereby (each a “Tax Controversy”), and in connection with the preparation and filing of any Tax Return, or amendment thereto. Such cooperation will include the retention and (upon the other such Party’s written request) the provision of records and information reasonably relevant to any such audit, litigation or other proceeding, or any such Tax Return or amendment thereto, and making employees available on before any taxing authority unless otherwise required pursuant to a mutually convenient basis to provide additional information and explanation of any material provided hereunder; provided, however, that no determination (as such Party shall be required to retain any Tax Returns, supporting workpapers, or other records beyond a time that term is thirty (30) days after the expiration defined in Section 1313 of the applicable statute of limitations with respect to a Tax. NEWCO and the HEC Members further agree, upon request, to use their reasonable efforts to obtain any certificate, including any resale or similar certificate, or other document from any Person as may be reasonably necessary to mitigate, reduce or eliminate any Tax that could be imposed (including with respect to the transactions contemplated by this Contribution AgreementCode). Without limiting the foregoing, the Sellers’ Representative shall control any Tax Controversy with respect to Pre-Closing Tax Returns or Straddle Returns relating to income or franchise Taxes that are payable by the HEC Members, provided that NEWCO shall be entitled to participate in such Tax Controversy (at NEWCO’s own expense) and shall be afforded current access to all correspondence and information in connection therewith, and provided further that the Sellers’ Representative shall not be entitled to settle any such Tax Controversy in a manner that would materially and adversely impact NEWCO without the prior written consent of NEWCO, which consent shall not be unreasonably withheld.