Common use of Procedures Relating to Indemnification of Tax Claims Clause in Contracts

Procedures Relating to Indemnification of Tax Claims. 12.5.1 If a claim for Taxes is made or a notice of an audit is issued by any Tax Authority in writing, which, if successful, might result in an indemnity payment pursuant to Section 12.4, the party seeking indemnification (the “Tax Indemnified Party”) shall promptly notify the other party (the “Tax Indemnifying Party”) in writing of such claim (a “Tax Claim”) within a reasonably sufficient period of time to allow the Tax Indemnifying Party effectively to contest such Tax Claim, and in reasonable detail to apprise the Tax Indemnifying Party of the nature of the Tax Claim, and provide copies of all correspondence and documents received by it from the relevant Tax Authority. Failure to give prompt notice of a Tax Claim hereunder shall not affect the Tax Indemnifying Party’s obligation under Section 12.4, except to the extent that the Tax Indemnifying Party is materially prejudiced by such failure to give prompt notice. 12.5.2 With respect to any Tax Claim which might result in an indemnity payment to Holdings pursuant to Section 12.4 (including, without limitation, Taxes relating to a Pre-Closing Period), Parent shall control all proceedings taken in connection with such Tax Claim to the extent relating to periods ending prior to the Closing or any Pre-Closing Period and, without limiting the foregoing, may in its sole discretion and at its sole expense pursue or forego any and all administrative appeals, proceedings, hearings and conferences with any Tax Authority with respect thereto, and may, in its sole discretion, either pay the Tax claimed and xxx for a refund where applicable law permits such refund suits or contest such Tax Claim. Parent shall not under any circumstances settle or otherwise compromise any Tax Claim referred to in the preceding sentence without Holdings’ prior written consent, not to be unreasonably withheld. In connection with any proceeding taken in connection with such Tax Claim, (i) Parent shall keep Holdings informed of all material developments and events relating to such Tax Claim if involving a material liability for Taxes, and (ii) Holdings shall have the right to participate, at its sole expense, in (but not control) any such proceedings. Holdings shall cooperate with Parent in contesting such Tax Claim, which cooperation shall include, without limitation, the issuance of a power of attorney, the provision to Parent of records and information which are reasonably relevant to such Tax Claim, and making employees available to provide additional information or explanation of any material provided hereunder or to testify at proceedings relating to such Tax Claim. In connection with such cooperation, Parent shall reimburse Holdings for any out-of-pocket expenses incurred with respect thereto. 12.5.3 With respect to any Tax Claim not described in the preceding paragraph (including that which might result in an indemnity payment to Parent pursuant to Section 12.4), Holdings shall control all proceedings in accordance with provisions that are parallel to those in Section 12.5.2.