Common use of Allocation Conventions Clause in Contracts

Allocation Conventions. For purposes of Section 3(a): (i) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period that is based on or measured by income, sales, use, receipts, or other similar items shall be allocated between the Pre-Closing Period and the Post-Closing Period based on the Closing of the Books Method as of the end of the Closing Date; provided, however, that if Applicable Law does not permit an Emerson Contributed Subsidiary to close its Taxable year on the Closing Date, the Tax attributable to the operations of such Emerson Contributed Subsidiary for any Pre-Closing Period shall be the Tax computed using a hypothetical closing of the books consistent with the Closing of the Books Method (except to the extent otherwise agreed upon by Emerson and Newco). (ii) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period other than Taxes described in Section 3(b)(i) shall be allocated between the Pre-Closing Period and the Post-Closing Period by multiplying the total amount of such Tax for the entire Straddle Period by a fraction, the numerator of which is the number of calendar days in the Straddle Period ending on, and including, the Closing Date, and the denominator of which is the number of calendar days in the entire Straddle Period, and allocating the result to the Pre-Closing Period and the remainder of such Tax to the Post-Closing Period. (iii) Notwithstanding the provisions of Section 3(b)(i), any Tax Item of an Emerson Contributed Subsidiary arising from a transaction engaged in outside the ordinary course of business on the Closing Date after the Closing shall be allocable to the Post-Closing Period, and any such transaction by or with respect to Newco or any member of the Newco Group occurring after the Closing shall be treated for all Tax purposes (to the extent permitted by Applicable Law) as occurring at the beginning of the day following the Closing Date in accordance with the principles of Treasury Regulations Section 1.1502-76(b) (assuming no election is made under Treasury Regulations Section 1.1502-76(b)(2)(ii) (relating to a ratable allocation of a year’s Tax Items)); provided that, for the avoidance of doubt, the foregoing shall not include any action expressly described in or contemplated by any Transaction Document or that is undertaken pursuant to the Pre-Closing Restructuring, any Deferred Closing, the Emerson Contributions or the Merger Exchange.

Allocation Conventions. (a) For purposes of determining the amount of any Centuri Separate Tax Liability following the Separation Date: (i) except as provided in Section 3(a2.2(a)(iii), all elections, accounting methods and conventions used on the Parent Federal Consolidated Income Tax Return (or applicable state law Combined Return in which a member of the Parent Group is the taxpayer of record) shall be used; (ii) the highest statutory marginal corporate income Tax rate in effect for such taxable period shall be applied (unless Parent determines in its sole discretion that a lower rate is applicable); and (iii) it shall be assumed that the Centuri Group elects not to carry back any Tax Attributes. (b) In the case of any Straddle Period in which there is a Deconsolidation, the following conventions shall apply (in addition to those conventions in clause (a)): (i) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period that is based on or measured by income, sales, use, receipts, or other similar items all Taxes shall be allocated between the Pre-Closing Period and the Post-Closing Period based on in accordance with the Closing of the Books Method as of the end of the Closing DateMethod; provided, however, that if Applicable Law any Centuri Group member does not permit an Emerson Contributed Subsidiary to close its Taxable taxable year on the Closing Deconsolidation Date, the Tax Taxes attributable to the operations of such Emerson Contributed Subsidiary for any PrePost-Closing Deconsolidation Period shall be the Tax computed using a hypothetical closing of the books consistent with the Closing of the Books Method (except to the extent otherwise agreed upon by Emerson and Newco).Method; (ii) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period other than Taxes described in Section 3(b)(i) shall be allocated between the Pre-Closing Period and the Post-Closing Period by multiplying the total amount of such Tax for the entire Straddle Period by a fraction, the numerator of which is the number of calendar days in the Straddle Period ending on, and including, the Closing Date, and the denominator of which is the number of calendar days in the entire Straddle Period, and allocating the result to the Pre-Closing Period and the remainder of such Tax to the Post-Closing Period. (iii) Notwithstanding the provisions of Section 3(b)(i), any Tax Item of an Emerson Contributed Subsidiary any Centuri Group member arising from a transaction engaged in outside of the ordinary course of business on the Closing Deconsolidation Date after the Closing shall be allocable to the Post-Closing Period, Centuri and any such transaction by or with respect to Newco or any Centuri Group member of occurring on the Newco Group occurring after the Closing Deconsolidation Date shall be treated for all Tax purposes (to the extent permitted by Applicable applicable Tax Law) as occurring at the beginning of the day following the Closing Deconsolidation Date in accordance with the principles of Treasury Regulations Section 1.1502-76(b) (assuming no election is made under Treasury Regulations Section 1.1502-76(b)(2)(ii) (relating to a ratable allocation of a year’s Tax Items))) or any similar state or local Tax Law; provided that, and (iii) any deferred Tax liability that is attributable to the Centuri Business and that is accelerated or otherwise required to be reported on any Joint Return as a result of the Deconsolidation shall be treated as arising in the Post-Deconsolidation Period. (c) The amount of any Centuri Separate Tax Liability shall not be less than zero. (d) Centuri shall reimburse Parent for all reasonable costs and expenses paid or incurred by the avoidance Parent Group in connection with determining the amount of doubtany Centuri Separate Tax Liability. (e) In the event of any redetermination of a Tax liability in respect of any Joint Return, the foregoing Centuri Separate Tax Asset or Centuri Separate Tax Liability applicable to such Joint Return shall not include any action expressly described in or contemplated by any Transaction Document or that is undertaken be recomputed. If, as a result of such recalculation, Centuri would be allocated additional Taxes pursuant to the Pre-Closing RestructuringSection 2.1, any Deferred ClosingCenturi shall promptly pay over to Parent such amounts in accordance with Section 3.8. If, the Emerson Contributions or the Merger Exchangeas a result of such recalculation, Centuri would be allocated less Taxes pursuant to Section 2.1 than it previously paid, Parent shall promptly pay over to Centuri such amounts in accordance with Section 3.8.

Allocation Conventions. For purposes of Section 3(a): (i) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period that is based on or measured by income, sales, use, receipts, or other similar items shall be allocated between the Pre-Closing Period and the Post-Closing Period based on the Closing of the Books Method as of the end of the Closing Date; provided, however, that if Applicable Law does not permit an Emerson Contributed Subsidiary to close its Taxable year on the Closing Date, the Tax attributable to the operations of such Emerson Contributed Subsidiary for any Pre-Closing Period shall be the Tax computed using a hypothetical closing of the books consistent with the Closing of the Books Method (except to the extent otherwise agreed upon by Emerson and Newco). (ii) The amount of any Tax of any Emerson Contributed Subsidiary with respect to a Straddle Period other than Taxes taxes described in Section 3(b)(i) shall be allocated between the Pre-Closing Period and the Post-Closing Period by multiplying the total amount of such Tax for the entire Straddle Period by a fraction, the numerator of which is the number of calendar days in the Straddle Period ending on, and including, the Closing Date, and the denominator of which is the number of calendar days in the entire Straddle Period, and allocating the result to the Pre-Closing Period and the remainder of such Tax to the Post-Closing Period. (iii) Notwithstanding the provisions of Section 3(b)(i), any Tax Item of an Emerson Contributed Subsidiary arising from a transaction engaged in outside the ordinary course of business on the Closing Date after the Closing shall be allocable to the Post-Closing Period, and any such transaction by or with respect to Newco or any member of the Newco Group occurring after the Closing shall be treated for all Tax purposes (to the extent permitted by Applicable Law) as occurring at the beginning of the day following the Closing Date in accordance with the principles of Treasury Regulations Section 1.1502-76(b) (assuming no election is made under Treasury Regulations Section 1.1502-76(b)(2)(ii) (relating to a ratable allocation of a year’s Tax Items)); provided that, for the avoidance of doubt, the foregoing shall not include any action expressly described in or contemplated by any Transaction Document or that is undertaken pursuant to the Pre-Closing Restructuring, any Deferred Closing, the Emerson Contributions or the Merger Exchange.