Common use of Canadian Tax Matters Clause in Contracts

Canadian Tax Matters. (a) Purchaser shall, at Purchaser’s expense, prepare and timely file or shall cause to be prepared and timely filed (i) any Tax Return of each of Purchaser Sub and CIT ULC for any of its taxable periods ending after the Closing Date that includes a transaction in the Restructuring Plan, (ii) the Tax Return for the first taxable period of the entity resulting from the amalgamation, at step 12 of the Restructuring Plan, between Purchaser Sub and CIT ULC (“CanAmalCo”), which shall include (x) a designation under paragraph 88(1)(d) of the Canadian Tax Act to increase the cost to CanAmalCo of its member interests of CIT LLC by an amount equal to the maximum amount permissible under the Canadian Tax Act and (y) an election under section 93 of the Canadian Tax Act in respect of disposition by CanAmalCo of its CIT LLC member interests containing an elected amount that is equal to the tax-free surplus balance of CIT LLC, within the meaning of subsection 5905(5.5) of the Income Tax Regulations (Canada), and (iii) a form filed by Purchaser Sub with the Minister of National Revenue containing all information required by, and prepared in a manner that complies with, paragraph 212.3(7)(d) of the Canadian Tax Act. (b) Any debt financing raised by Parent or any of its Affiliates to finance the acquisition of CIT ULC or the Transferred Company will be indebtedness that was issued for consideration that consists solely of money. (c) From and after the date of this Agreement, and for a period of 36 months following the Closing, Parent and its Affiliates (including Purchaser Direct Parent, Purchaser, and CanAmalCo) will not knowingly remarket, offer for sale, or transfer any property distributed to CanAmalCo by CIT ULC on the amalgamation of CIT ULC and Purchaser Sub, for purposes of subsection 88(1) of the Canadian Tax Act (including, without limitation, CIT LLC member interests), or any property substituted for any such distributed property (within the meaning of subsection 88(1) of the Canadian Tax Act), other than any publicly traded security, to any person who was a shareholder of CIT Group Inc. at any time in the period from 6 months preceding the execution of this Agreement to the Closing Date. (d) Any equity financing raised by Purchaser Sub to finance the acquisition of CIT ULC will be shares of its capital stock issued for consideration that consists solely of money.

Canadian Tax Matters. Sellers, the Company and Purchaser covenant and agree as follows: (a) Sellers and the Company shall take all reasonable steps to obtain and deliver to Purchaser shallon or before the Closing Date a certificate issued by the Canada Revenue Agency (“CRA”) under subsection 116(2) of the Income Tax Act (Canada) (the “Canada Tax Act”) in respect of the disposition of the Shares in form and substance acceptable to Purchaser, at acting reasonably; (b) if a certificate is so delivered to Purchaser’s expense, prepare Purchaser shall be entitled to withhold from the Initial Consideration twenty-five percent (25%) of the amount, if any, by which the Initial Consideration payable for the Shares, as set out on Schedule 3.7(b) (the “Initial Shares Purchase Price”), exceeds the certificate limit indicated on such certificate; (c) if a certificate is not so delivered, Purchaser shall be entitled to withhold from the Initial Consideration an amount equal to twenty-five percent (25%) of the Initial Shares Purchase Price; (d) where Purchaser has withheld any amount under paragraphs (b) or (c) and timely file or shall cause Sellers deliver to be prepared and timely filed (i) any Tax Return of each of Purchaser Sub and CIT ULC for any of its taxable periods ending Purchaser, after the Closing Date and on or before the day that includes is no less than three business days before the 30th day after the end of the month in which Purchaser acquired the Shares (the “Remittance Deadline”), a transaction certificate issued by the Minister of National Revenue under subsection 116(2) or 116(4) of the Canada Tax Act, Purchaser, (i) shall, in the Restructuring Plancase of a certificate issued by the CRA under subsection 116(2) of the Canada Tax Act, remit to the Receiver General for Canada twenty-five percent (25%) of the amount, if any, by which the Initial Shares Purchase Price exceeds the certificate limit fixed in such certificate; and (ii) shall pay forthwith to Sellers any amount that Purchaser has withheld and is not required to pay to the Tax Return Receiver General for Canada in accordance with subparagraph (i) above, as well as interest earned on any withheld funds (net of applicable withholding tax); (e) where Purchaser has withheld any amount under paragraph (b) or (c) and no certificate has been delivered to Purchaser by Sellers on or before the first taxable Remittance Deadline in accordance with paragraph (d), subject to paragraph (f), such amount shall be remitted by Purchaser to the Receiver General for Canada (for greater certainty, Purchaser shall not remit any amount until after the Remittance Deadline), and interest earned on any withheld funds shall be promptly paid to Sellers (net of applicable withholding tax); (f) where Purchaser has withheld any amount under paragraphs (b) or (c) and no certificate has been delivered to Purchaser by Sellers on or before the Remittance Deadline in accordance with paragraph (d), no amount shall be remitted by Purchaser to the Receiver General for Canada if Sellers deliver to Purchaser, on or before the Remittance Deadline, a comfort letter issued by the CRA in form and substance satisfactory to Purchaser extending the time period under which Purchaser is required to remit an amount in respect of the entity resulting from Consideration; (g) where Purchaser has withheld any amount under this Section (the amalgamation“Withheld Amount”) and Sellers have delivered to Purchaser a comfort letter as described in paragraph (f), at step 12 Purchaser shall continue to withhold such amount until it is either (i) paid to Sellers (together with any interest earned thereon, net of the Restructuring Plan, between Purchaser Sub and CIT ULC (“CanAmalCo”applicable withholding tax), which shall include (xoccur upon delivery by Sellers to Purchaser of a certificate issued by the CRA under either subsection 116(2) a designation under paragraph 88(1)(dor 116(4) of the Canadian Canada Tax Act to increase (except that in the cost to CanAmalCo case of its member interests a certificate issued under subsection 116(2) of CIT LLC by an amount equal the Canada Tax Act, Purchaser shall withhold and remit to the maximum amount permissible Receiver General for Canada the amount, if any, by which the Withheld Amount exceeds twenty-five percent (25%) of the certificate limit); or (ii) remitted to the Receiver General for Canada for the account of Sellers if notified to do so by the CRA (provided that any interest earned thereon shall be for the account of Sellers and shall be paid to Sellers net of applicable withholding tax); (h) the Withheld Amount, if any, shall be converted into Canadian dollars on the Closing Date and shall be paid to and held by Purchaser in trust, and invested by it in one or more investments, the interest on which is not subject to Canadian withholding tax under Part XIII of the Canadian Canada Tax Act and which investments are otherwise agreed to by Sellers and Purchaser from the date of receipt, until paid to Sellers (ytogether with any interest earned thereon) or remitted to the Receiver General for Canada for the account of Sellers in accordance with this Section; (i) if the Consideration payable for the Shares is increased after the Closing Date in accordance with Section 3.3 to an election amount that exceeds the amount designated as “proceeds of disposition” on the most recent certificate issued by the CRA under section 93 subsection 116(4) of the Canadian Canada Tax Act, or, if no such certificate has been issued, the certificate limit on the most recent certificate issued by the CRA under subsection 116(2) of the Canada Tax Act, Sellers shall (i) take all reasonable steps to obtain and deliver to Purchaser on or before the 5th business day following the final determination of the Consideration payable for the Shares a certificate issued by the CRA under Section 116 of the Canada Tax Act in respect of the disposition by CanAmalCo of its CIT LLC member interests containing an elected amount that is the Shares in form and substance acceptable to Purchaser, acting reasonably, with either proceeds of disposition or a certificate limit at least equal to the taxConsideration payable for the Shares (as adjusted); (ii) if a certificate is not so delivered to Purchaser, Purchaser shall be entitled to withhold from any payment made by Purchaser to Sellers twenty-free surplus balance of CIT LLC, within the meaning of subsection 5905(5.5five percent (25%) of the Income Tax Regulations amount by which the Consideration payable for the Shares (Canada)as adjusted) exceeds the greater of (a) the Initial Shares Purchase Price, and (b) the certificate limit or the proceeds of disposition, as applicable, indicated on the most recent certificate issued by the CRA under Section 116 of the Tax Act and delivered by Sellers to Purchaser in respect of the disposition of the Shares; and (iii) a form filed by where Purchaser Sub with the Minister of National Revenue containing all information required by, and prepared in a manner that complies with, paragraph 212.3(7)(d) of the Canadian Tax Act. has withheld any amount under (b) Any debt financing raised by Parent or any of its Affiliates to finance the acquisition of CIT ULC or the Transferred Company will be indebtedness that was issued for consideration that consists solely of money. (c) From and after the date of this Agreement, and for a period of 36 months following the Closing, Parent and its Affiliates (including Purchaser Direct Parent, Purchaser, and CanAmalCo) will not knowingly remarket, offer for sale, or transfer any property distributed to CanAmalCo by CIT ULC on the amalgamation of CIT ULC and Purchaser Sub, for purposes of subsection 88(1) of the Canadian Tax Act (including, without limitation, CIT LLC member interestsii), or any property substituted for any such distributed property (within the meaning provisions of subsection 88(1) of the Canadian Tax Act), other than any publicly traded security, to any person who was a shareholder of CIT Group Inc. at any time in the period from 6 months preceding the execution of this Agreement to the Closing Date. paragraph (d) Any equity financing raised by through (h) of this Section 3.7 shall apply, modified as the circumstances require, to such withheld amount; and (j) all amounts remitted to the Receiver General for Canada or paid to Sellers in accordance with the provisions of this Section 3.7 shall be credited to Purchaser Sub as a payment on account of the Consideration at the inverse of the foreign exchange rate used to finance convert the acquisition of CIT ULC will be shares of its capital stock issued for consideration that consists solely of moneyWithheld Amount into Canadian dollars.

Canadian Tax Matters. (a) Purchaser shallPrior to the Closing Date, at Purchaser’s expense, prepare and timely file or Seller Parent shall cause CanadaCo to be prepared and timely filed make a filing pursuant to (iat the election of Seller Parent) any Tax Return of each of Purchaser Sub and CIT ULC for any of its taxable periods ending after the Closing Date that includes a transaction in the Restructuring Plan, (iieither paragraph 212.3(11)(c) the Tax Return for the first taxable period of the entity resulting from the amalgamation, at step 12 of the Restructuring Plan, between Purchaser Sub and CIT ULC (“CanAmalCo”), which shall include (x) a designation under or paragraph 88(1)(d212.3(7)(d) of the Canadian Tax Act to increase the cost to CanAmalCo of its member interests of CIT LLC by an amount equal to the maximum amount permissible under the Canadian Tax Act and (y) an election under section 93 of the Canadian Tax Act in respect of disposition by CanAmalCo of its CIT LLC member interests containing an elected amount that is equal to the tax-free surplus balance of CIT LLC, within the meaning of each “investment” (as defined in subsection 5905(5.5212.3(10) of the Income Tax Regulations (Canada)Act, and (iii) a form filed by Purchaser Sub with the Minister of National Revenue containing all information required by, and prepared in a manner that complies with, paragraph 212.3(7)(dread without reference to subparagraph 212.3(10)(c)(i) of the Canadian Tax Act) made or otherwise made by CanadaCo in UKCo in a Pre-Closing Tax Period (for greater certainty other than in respect of the Pre-Closing Reorganization). Seller Parent shall provide to Buyer a draft of each such filing for its review no later than twenty (20) days prior to the filing due date or filing thereof, and Seller Parent shall implement Buyer’s reasonable comments. Any Taxes arising in connection with a late filing of such elections pursuant to subparagraph 212.3(7)(d)(ii) (for greater certainty net of any refund under subsection 227(6.2)) and subsection 212.3(13) of the Tax Act shall constitute a Current Liability. (b) Any debt financing raised Seller Parent acknowledges that the applicable Buyer may enter into transactions (the “Bump Transactions”) designed to step up the tax basis in respect of the shares of UKCo and other non-depreciable capital property owned by Parent or any of its Affiliates CanadaCo pursuant to finance the acquisition of CIT ULC or the Transferred Company will be indebtedness that was issued for consideration that consists solely of money. (cparagraphs 88(1)(c) From and after the date of this Agreement, and for a period of 36 months following the Closing, Parent and its Affiliates (including Purchaser Direct Parent, Purchaser, and CanAmalCo) will not knowingly remarket, offer for sale, or transfer any property distributed to CanAmalCo by CIT ULC on the amalgamation of CIT ULC and Purchaser Sub, for purposes of subsection 88(188(1)(d) of the Canadian Tax Act upon an amalgamation or winding-up of CanadaCo (including, without limitation, CIT LLC member interestsor its successor) (a “Bump”), or any property substituted for any such distributed property (within ; and from the meaning of subsection 88(1) of the Canadian Tax Act), other than any publicly traded security, to any person who was a shareholder of CIT Group Inc. at any time in the period from 6 months preceding the execution date of this Agreement to the Closing Date, Seller Parent agrees to use commercially reasonable efforts to provide information reasonably requested by Buyer Parent in this regard (including regarding the classes of shares issued by Seller Parent and the holders of such shares) on a timely basis (to the extent such information is in Seller Parent's or a Target Company's possession or control) and to act in a commercially reasonably manner to assist in the obtaining of any such information in order to facilitate the completion of the Bump Transactions. (d) Any equity financing raised by Purchaser Sub to finance the acquisition of CIT ULC will be shares of its capital stock issued for consideration that consists solely of money.

Canadian Tax Matters. There are no circumstances existing which could result in the application of either section 78 or section 80 of the Income Tax Act (aCanada) Purchaser shallor any equivalent provincial provision to the Company or any of its Subsidiaries. Neither the Company nor any of its Subsidiaries has claimed or will claim any reserve under any one or more of subparagraph 40(1)(a)(iii), at Purchaser’s expenseor paragraphs 20(1)(l), prepare and timely file 20(1)(m) or shall cause to 20(1)(n) of the Income Tax Act (Canada) or any equivalent provincial provision, if any such amount could be prepared and timely filed included in the income of the Company or any of the Subsidiaries for any period ending after Closing. (i) any Tax Return Each of the Company and its Subsidiaries has withheld from each of Purchaser Sub and CIT ULC for payment made to any of its taxable present or former employees, officers and directors, and to all Persons who are (or were at the relevant time) non-residents of Canada for the purposes of the Income Tax Act (Canada), all amounts required by Law and has remitted such withheld amounts within the prescribed periods to the appropriate Governmental Entity. Each of the Company and its Subsidiaries has properly withheld all Canada Pension Plan contributions, unemployment insurance premiums, employer health Tax and other Taxes payable by it with respect to its employees and has or will have remitted such amounts to the appropriate Governmental Entity within the time required under the applicable legislation. Each of the Company and its Subsidiaries has charged, collected and remitted on a timely basis all Taxes as required by applicable legislation, including those imposed under Part XI of the Excise Tax Act (Canada) on any sale, supply or delivery whatsoever made by the Company or any of its Subsidiaries. (ii) Copies of all forms T2038 or any equivalent forms are attached as Schedule 4.10(d) and have been accepted as correct and complete by the relevant Governmental Entity for the purpose of the Income Tax Act (Canada) and any relevant provincial taxing statute. Schedule 4.10(d) accurately sets out the investment tax credits (as defined in the Income Tax Act (Canada) and any relevant provincial taxing Law) still available to the Company or its Subsidiaries for taxation years ending after the Closing Date that includes a transaction in or used by the Restructuring Plan, (ii) the Tax Return for the first taxable period of the entity resulting from the amalgamation, at step 12 of the Restructuring Plan, between Purchaser Sub and CIT ULC (“CanAmalCo”), which shall include (x) a designation under paragraph 88(1)(d) of the Canadian Tax Act to increase the cost to CanAmalCo of its member interests of CIT LLC by an amount equal Company with respect to the maximum amount permissible under the Canadian Tax Act and (y) an election under section 93 of the Canadian Tax Act in respect of disposition by CanAmalCo of its CIT LLC member interests containing an elected amount that is equal to the tax-free surplus balance of CIT LLC, within the meaning of subsection 5905(5.5) of the Income Tax Regulations (Canada), and (iii) a form filed by Purchaser Sub with the Minister of National Revenue containing all information required by, and prepared in a manner that complies with, paragraph 212.3(7)(d) of the Canadian Tax Act. (b) Any debt financing raised by Parent or any of its Affiliates to finance the acquisition of CIT ULC or the Transferred Company will be indebtedness that was issued for consideration that consists solely of money. (c) From and after the date of this Agreement, and for a period of 36 months following the Closing, Parent and its Affiliates (including Purchaser Direct Parent, Purchaser, and CanAmalCo) will not knowingly remarket, offer for sale, or transfer any property distributed to CanAmalCo by CIT ULC on the amalgamation of CIT ULC and Purchaser Sub, for purposes of subsection 88(1) of the Canadian Tax Act (including, without limitation, CIT LLC member interests), or any property substituted for any such distributed property (within the meaning of subsection 88(1) of the Canadian Tax Act), other than any publicly traded security, to any person who was a shareholder of CIT Group Inc. at any time in the period from 6 months preceding the execution of this Agreement to last seven taxation years ending before the Closing Date. (diii) Any equity financing raised by Purchaser Sub to finance Each of the acquisition Canadian Subsidiaries is resident in Canada, as defined in the Income Tax Act (Canada). (iv) Each of CIT ULC will be shares the Canadian Subsidiaries is a Canadian-controlled private corporation, as defined in the Income Tax Act (Canada), and has been since its incorporation. Each of the Canadian Subsidiaries is a registrant for the purposes of the goods and services tax provided for under the Excise Tax Act (Canada). (v) Neither the Company nor any of its capital stock issued Canadian Subsidiaries has made or filed any election under section 83 or section 85 of the Income Tax Act (Canada) or any equivalent provincial provision, other than those elections disclosed on Schedule 4.10(d). All elections or designations required to be filed by the Company or any of its Subsidiaries have been duly filed on a timely basis. (vi) Each of the Company and its Canadian Subsidiaries has paid all Taxes imposed under the Retail Sales Tax Act (Ontario) and comparable legislation of any other province or territory of Canada, and none of its tangible personal property has been transferred at any time on a tax-exempt basis under the provisions of the Retail Sales Tax Act (Ontario) and comparable legislation of any other province or territory of Canada or any predecessor thereof. (vii) Neither the Company nor any of its Canadian Subsidiaries has ever acquired or had the use of any of the assets, real or personal, tangible or intangible, of the Company or any of its Subsidiaries, as the case may be, from a Person (a "Related Person") with whom the Company or any of its Canadian Subsidiaries, as the case may be, was not dealing at arm's length, as determined under the Income Tax Act (Canada). Neither the Company nor any of its Canadian Subsidiaries has ever disposed of such asset to a Related Person for consideration that consists solely proceeds less than the fair market value of moneysuch asset.