Common use of Offset For Certain Federal Tax Benefits Clause in Contracts

Offset For Certain Federal Tax Benefits. Notwithstanding the provisions of Section 5.01 through 5.04 specifying the amount of payments (inclusive of interest, penalties and additions) from one Group to the other Group related to State Income Taxes, Foreign Income Taxes or other Taxes other than Federal Income Taxes (any such payment, an "Intergroup Non-Federal Tax Payment"), if (i) the Group receiving such Intergroup Non-Federal Tax Payment (the "Recipient Group") is entitled to claim a Tax deduction or Tax credit for Federal Income Tax purposes with respect to its payment or accrual of all or any portion of the Tax to which such Intergroup Non-Federal Tax Payment pertains (any such portion of such Tax, the "Federal Tax Benefited Amount"), and (ii) all or any portion of such Federal Tax Benefited Amount is not deductible for Federal Income Tax purposes by the paying Group and is not includible in income of the Recipient Group for Federal Income Tax purposes (such portion not deductible and not includable, the "Nontaxable Portion"), then (iii) the amount of such Intergroup Non-Federal Tax Payment shall be reduced by the value of the Recipient Group's Federal Income Tax Benefit attributable to such Nontaxable Portion. By way of illustration of the foregoing, if New Fluor is otherwise obligated under this Agreement to make a payment of $1,000,000 to Parent related to a State Income Tax that is allocable under this Agreement to the New Fluor Group but as to which (x) Parent will be entitled to claim a Federal Income Tax deduction, and (y) in accordance with the principles of Section 5.05(a), such payment from New Fluor to Parent is neither deductible by New Fluor nor includible in income by Parent, then (y) the amount of the payment from New Fluor to Parent shall be reduced to $650,000 if Parent's applicable Federal Income Tax rate is 35%.

Offset For Certain Federal Tax Benefits. Notwithstanding the provisions of Section 5.01 through 5.04 specifying the amount of payments (inclusive of interest, penalties and additions) from one Group to the other Group related to State Income Taxes, Foreign Income Taxes or other Taxes other than Federal Income Taxes (any such payment, an "Intergroup Non-Federal Tax Payment"), if (i) the Group receiving such Intergroup Non-Federal Tax Payment (the "Recipient Group") is entitled to claim a Tax deduction or Tax credit for Federal Income Tax purposes with respect to its payment or accrual of all or any portion of the Tax to which such Intergroup Non-Federal Tax Payment pertains (any such portion of such Tax, the "Federal Tax Benefited Amount"), and (ii) all or any portion of such Federal Tax Benefited Amount is not deductible for Federal Income Tax purposes by the paying Group and is not includible in income of the Recipient Group for Federal Income Tax purposes (such portion not deductible and not includable, the "Nontaxable Portion"), then (iii) the amount of such Intergroup Non-Federal Tax Payment shall be reduced by the value of the Recipient Group's Federal Income Tax Benefit attributable to such Nontaxable Portion. By way of illustration of the foregoing, if New Fluor is otherwise obligated under this Agreement to make a payment of $1,000,000 to Parent related to a State Income Tax that is allocable under this Agreement to the New Fluor Group but as to which (x) Parent will be entitled to claim a Federal Income Tax deduction, and (y) in accordance with the principles of Section 5.05(a), such payment from New Fluor to Parent is neither deductible by New Fluor nor includible in income by Parent, then (y) the amount of the payment from New Fluor to Parent shall be reduced to $650,000 if ParentNew Fluor's applicable Federal Income Tax rate is 35%.

Offset For Certain Federal Tax Benefits. Notwithstanding the provisions of Section 5.01 through 5.04 specifying the amount of payments (inclusive of interest, penalties and additions) from one Group to the other Group related to State Income Taxes, Foreign Income Taxes or other Taxes other than Federal Income Taxes (any such payment, an "Intergroup Non-Federal Tax Payment"), if (i) the Group receiving such Intergroup Non-Non- Federal Tax Payment (the "Recipient Group") is entitled to claim a Tax deduction or Tax credit for Federal Income Tax purposes with respect to its payment or accrual of all or any portion of the Tax to which such Intergroup Non-Federal Tax Payment pertains (any such portion of such Tax, the "Federal Tax Benefited Amount"), and (ii) all or any portion of such Federal Tax Benefited Amount is not deductible for Federal Income Tax purposes by the paying Group and is not includible in income of the Recipient Group for Federal Income Tax purposes (such portion not deductible and not includable, the "Nontaxable Portion"), then (iii) the amount of such Intergroup Non-Federal Tax Payment shall be reduced by the value of the Recipient Group's Federal Income Tax Benefit attributable to such Nontaxable Portion, with such value to be determined assuming that the Federal Income Tax Benefit will reduce income taxable at the highest marginal corporate Federal Income Tax rate. By way of illustration of the foregoing, if New Fluor is otherwise obligated under this Agreement to make a payment of $1,000,000 to Parent related to a State Income Tax that is allocable under this Agreement to the New Fluor Group but as to which (x) Parent will be entitled to claim a Federal Income Tax deduction, and (y) in accordance with the principles of Section 5.05(a), such payment from New Fluor to Parent is neither deductible by New Fluor nor includible in income by Parent, then (y) the amount of the payment from New Fluor to Parent shall be reduced to $650,000 if Parent's applicable the highest marginal corporate Federal Income income Tax rate is 35%.