Tax Indemnification and Other Tax Matters. (a) Notwithstanding anything to the contrary in the Agreement, Parent, Seller and NMT-US shall, jointly and severally, indemnify, save and hold harmless the Buyer Indemnified Parties from and against any and all Damages incurred in connection with, arising out of, resulting from or relating to (i) any fact inconsistent with, or any untruth, inaccuracy or breach of, any representation, warranty or covenant of Parent, Seller, NMT-US or any of the Acquired Companies or the Seller contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment), 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to the Acquired Companies and the US-Based Assets (A) with respect to all periods ending on or prior to the Closing Date, and (B) with respect to the Stub Tax Period. For the purposes of this Agreement, the period from January 1, 2000 through and including the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter is referred to herein as the "Post-Closing Period." (b) For purposes of this Section 14.3, Tax or Taxes shall include the amount of Taxes which would have been paid but for the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after the Closing Date. (c) For the avoidance of doubt, the parties agree that the provisions of this Section 14.3 shall be interpreted and applied in such a manner such that none of Buyer, ISC or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled to indemnification under this Section 14.3 on the basis of said under-accrual). (d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, the Acquired Companies or Buyer, as the case may be, shall give notice thereof to Parent. Parent shall pay the amount of such Taxes Buyer (or Buyer's designee), within 30 days after the receipt of such notice. (e) Parent and Buyer agree to give prompt notice to each other of any proposed adjustment to Taxes for periods ending on or prior to the Closing Date. Seller shall have the right to conduct any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs of the Acquired Companies; (ii) Buyer receives copies of all relevant material written correspondence from any Tax authority; (iii) no material written communication is sent to any Tax authority without first submitting in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayed); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall have the right at their option and expense to participate in any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s).
Appears in 1 contract
Samples: Purchase Agreement (NMT Medical Inc)
Tax Indemnification and Other Tax Matters. (ai) Notwithstanding anything to the contrary in the Agreement, Parent, Seller and NMT-US the Affiliates shall, jointly and severally, indemnify, save and hold harmless the Buyer Xxxxxxx Indemnified Parties from and against any and all Damages damages, losses, costs, claims, expenses and liabilities including without limitation, interest, penalties, reasonable attorneys' fees and expenses, incurred in connection with, arising out of, resulting from or relating to (i) any fact inconsistent with, or any untruth, untruth or inaccuracy or breach of, any representation, representation or warranty or covenant of Parent, Seller, NMT-US or any of the Acquired Companies Xxxxxxx or the Seller Affiliates contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment)Section 2.17, 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to Xxxxxxx or the Acquired Companies and assets and/or the US-Based Assets business of Xxxxxxx (A) with respect to all periods ending on or prior to the Closing Date, Date and (B) with respect to any period beginning before the Stub Tax Period. For Closing and ending after the purposes Closing Date, but only with respect to the portion of this Agreement, the such period from January 1, 2000 through up to and including the Closing Date is (such portion shall be referred to herein as the "Pre" PRE-Closing PeriodCLOSING TAX PERIOD" and any the portion of such period thereafter is after the Closing Date shall be referred to herein as the "PostPOST-Closing PeriodCLOSING TAX PERIOD")."
(bii) For purposes of this Section 14.36.2(b), Tax or Taxes shall include the amount of Taxes which would have been paid but for the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after the Closing Date.
(ciii) For Any Taxes for a period including a Pre-Closing Period and a Post-Closing Period shall be apportioned between such Pre-Closing Period and such Post-Closing Period, based, in the avoidance case of doubtreal and personal property Taxes, on a per diem basis and, in the parties agree that case of other Taxes, on the basis of a closing of the books as of the Closing Date.
(iv) Without limiting the foregoing provisions of this Section 14.3 6.2(b), the definitions of "Loss" or "Losses" above shall be interpreted and applied in such a manner such that none of Buyer, ISC include any claim or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled right to indemnification under pursuant to this Section 14.3 on the basis of said under-accrual6.2(b).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, the Acquired Companies or Buyer, as the case may be, shall give notice thereof to Parent. Parent shall pay the amount of such Taxes Buyer (or Buyer's designee), within 30 days after the receipt of such notice.
(e) Parent and Buyer agree to give prompt notice to each other of any proposed adjustment to Taxes for periods ending on or prior to the Closing Date. Seller shall have the right to conduct any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs of the Acquired Companies; (ii) Buyer receives copies of all relevant material written correspondence from any Tax authority; (iii) no material written communication is sent to any Tax authority without first submitting in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayed); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall have the right at their option and expense to participate in any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s).
Appears in 1 contract
Tax Indemnification and Other Tax Matters. (a) Notwithstanding anything to the contrary in the AgreementSection 3.1, Parent, Seller Rock-Tenn and NMTRock-US shall, Tenn Partition jointly and severally, indemnify, save severally shall indemnify and hold harmless the Buyer Indemnified Parties from and against any and all Damages incurred each "Indemnitee" (as defined in connection with, arising out of, resulting from or relating to Section 4.1 of this Agreement) from:
(i) any fact inconsistent withAny liability for Tax of Rock-Tenn and Rock-Tenn Partition which is incurred in or attributable to the Tax Indemnification Period; and
(ii) Any liability, cost, expense (including, without limitation, reasonable expenses of investigation and reasonable attorneys' fees and expenses), loss, damages, assessment, settlement, or judgment arising out of or incident to the imposition, assessment or assertion of any untruthliability described in subclause (i) hereof, inaccuracy including those incurred in the contest in good faith of appropriate proceedings for the imposition, assessment or breach ofassertion of any Tax (subject to the provisions of Section 3.2(e) hereof), and any representation, warranty or covenant liability of Parent, Seller, NMT-US or any Indemnitee by reason of being a transferee of the Acquired Companies Assets of Rock-Tenn and Rock-Tenn Partition which is incurred or the Seller contained in Sections 2.2(c) (with respect attributable to the 1998/1999 Tax Make-Whole Payment), 3.7, 5.2(f)(vi), 5.9 or 5.11, Indemnification Period. The sum of (i) and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to the Acquired Companies and the US-Based Assets (A) with respect to all periods ending on or prior to the Closing Date, and (B) with respect to the Stub Tax Period. For the purposes of this Agreement, the period from January 1, 2000 through and including the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter above is referred to herein as the a "Post-Closing PeriodTax Loss."
(b) For purposes In the case of this Section 14.3any Taxes that are imposed, assessed or asserted on a periodic basis and are payable with respect to the Solid Fiber Partition Business or the Assets for a taxable period that includes (but does not end on) the Contribution Date, the portion of such Taxes related to the portion of such taxable period ending on the Contribution Date and the portion of such Taxes that is incurred in or attributable to the Pre-Contribution Tax Period shall (i) in the case of any Tax other than a Tax imposed on, measured by, or Taxes shall include related to revenues, gross or net income, receipts, gains or compensation from the operation of the Solid Fiber Partition Business, be deemed to be the amount of Taxes which would have been paid but such Tax for the application entire taxable period multiplied by a fraction, the numerator of which is the number of days in the Pre-Contribution Tax Period and the denominator of which is the number of days in the entire taxable period, and (ii) in the case of any credit Tax imposed on, measured by, or related to revenues, gross or net operating income, receipts, gains or capital loss deduction attributable compensation from the operation of the Solid Fiber Partition Business, be deemed equal to periods or portions the amount of such Tax for the entire taxable period multiplied by a period beginning after the Closing Date.
(c) For the avoidance of doubtfraction, the parties agree that numerator of which is the provisions of this Section 14.3 shall be interpreted and applied in such a manner such that none of Buyerrevenues, ISC gross or any of the Acquired Companies shall be entitled to double net income, receipts, gains or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled to indemnification under this Section 14.3 on the basis of said under-accrual).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, the Acquired Companies or Buyercompensation, as the case may be, attributable to the Tax Indemnification Period and the denominator of which is the total amount of revenues, gross or net income, receipts, gains or compensation for the entire taxable period.
(c) Upon the incurrence by any Indemnitee of any Tax Loss or any Loss relating to an "Excluded Tax Liability" (as defined in Section 1.5(a) hereof), Rock-Tenn and Rock-Tenn Partition jointly and severally shall give discharge its obligations to indemnify such Indemnitee against such Tax Loss or Loss by paying to the Indemnitee in cash an amount equal to the amount of such Tax Loss or Loss. Any payment pursuant to this Section 3.2(c) relating to an Excluded Tax Liability shall be delivered no later than five (5) days prior to the first date on which such Indemnitee is required (without incurring interest or penalties) under applicable Law to make any payment with respect to or as a result of such Tax Loss or Loss. The Company shall deliver to Rock-Tenn and Rock-Tenn Partition, upon the incurrence of a Tax Loss or any Loss relating to an Excluded Tax Liability by any Indemnitee, written notice describing such Tax Loss or Loss and stating the amount thereof, the amount of the indemnity payment requested, and the first date on which such Indemnitee is required (without incurring interest or penalties) to make any payment with respect to or as a result of such Tax Loss or Loss. Any payment required under this Section 3.2(c) or any Loss relating to an Excluded Tax Liability and not made when due shall bear interest at the federal short-term rate under Section 1274 of the Code for each day until paid.
(d) If any Indemnitee receives a refund or reduces its Tax Liability by using a credit of any Tax in respect of the Tax Indemnification Period or any Excluded Tax Liability, such Indemnitee shall pay to Rock-Tenn and Rock-Tenn Partition the amount of such refund or credit within thirty (30) days of the date on which such refund or credit is received or used by such Indemnitee. The Company agrees that, upon the request of Rock-Tenn or Rock-Tenn Partition, the Company shall file, or cause an Indemnitee to file, a claim for refund in such form as Rock-Tenn or Rock-Tenn Partition may reasonably request of any Tax in respect of the Tax Indemnification Period or any Excluded Tax Liability, provided that the Company or an Indemnitee shall not be required to file such a claim if such claim would adversely affect the Tax liability of the Company or any of its Affiliates. The Company agrees that it will cooperate, and cause each Indemnitee to cooperate, fully with Rock-Tenn and Rock-Tenn Partition and its counsel in connection therewith.
(i) If any adjustments shall be made to any Tax return relating to Rock-Tenn or Rock-Tenn Partition in respect of the Solid Fiber Partition Business or the Assets for any Pre-Contribution Tax Period which result in any Tax detriment to Rock-Tenn or any Affiliate thereof with respect to Parent. Parent such period and any Tax benefit to the Company or any Affiliate thereof for any Taxable period ending after the Contribution Date, Rock-Tenn shall be entitled to the benefit of such Tax benefit, and the Company shall pay to Rock-Tenn and Rock-Tenn Partition the amount of such Tax benefit at such time or times as and to the extent that the Company or any Affiliate thereof actually realizes such benefit through a refund of Tax or reduction in the amount of Tax which the Company or any Affiliate thereof otherwise would have had to pay if such adjustment had not been made.
(ii) If any adjustments (including any adjustment arising by reason of a refund claim) shall be made to any Tax return relating to the Company for any Taxable period after the Contribution Date which result in any Tax detriment to the Company or any Affiliate thereof with respect to such period and any Tax benefit to Rock-Tenn or any Affiliate thereof for any Pre-Contribution Tax Period, the Company shall be entitled to the benefit of such Tax benefit, and Rock-Tenn and Rock-Tenn Partition shall be obligated jointly and severally to pay to the Company the amount of such Tax benefit at such time or times as and to the extent that Rock-Tenn or any Affiliate thereof actually realizes such benefit through a refund of Tax or reduction in the amount of Tax which Rock-Tenn or any such Affiliate otherwise would have had to pay if such adjustment had not been made.
(f) If the Company or any Affiliate thereof realizes a Tax benefit in a Taxable period as described in Section 3.2(e) ending after the Contribution Date with respect to a Tax Loss through a refund of Tax or reduction in the amount of Tax which the Company or any Affiliate thereof otherwise would have to pay then, (i) if such benefit is actually realized prior to the indemnity payment being made, the amount of such benefit shall reduce the amount of the indemnity payment otherwise required to be made hereunder, and (ii) if such benefit is actually realized subsequent to the indemnity payment or contribution being made, the Company or such Affiliate shall pay the amount of such Taxes Buyer (or Buyer's designee), within 30 days after the receipt of benefit to Rock-Tenn and Rock-Tenn Partition at such noticetime as such benefit is actually realized.
(eg) Parent and Buyer agree With respect to give prompt notice liability for Tax of Rock-Tenn or any of its Affiliates incurred in or attributable to each other the Pre-Contribution Tax Period in respect of any proposed adjustment item which gave rise to Taxes an amount included in the provision for periods ending deferred income taxes on or prior Rock-Tenn's consolidated financial statements as of the Contribution Date, Rock-Tenn and Rock-Tenn Partition shall be obligated jointly and severally to pay to an Indemnitee an amount equal to the Closing Date. Seller shall have amount of such Tax liability, minus the right present value of (i) any deduction, amortization, exclusion from income, or tax credit allowable to conduct any audit or proceeding such Indemnitee which would not be allowable but for an adjustment with respect to Taxes involving which Rock-Tenn and Rock-Tenn Partition are obligated to indemnify such Indemnitee ("the Acquired Companies for Tax Benefit"), multiplied (ii) by the maximum applicable tax rate in effect at such period(s) provided that: time or, in the case of a credit, by 100 percent (the product of (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs of the Acquired Companies; and (ii) Buyer receives copies in the preceding clause shall be referred to as the "Hypothetical Tax Benefit"). The present value of all relevant material written correspondence from the Hypothetical Tax Benefit shall be determined based on the federal mid-term rate under Section 1274 of the Code in effect at the time the indemnification payment is made, compounded annually for the number of years between the year to which the adjustment relates and the year on which such Tax Benefit would be allowable under Law whether or not the Indemnitee could derive any actual Tax authority; (iii) no material written communication is sent to any Tax authority without first submitting in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayed); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall have the right at their option and expense to participate in any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s)savings as a result thereof.
Appears in 1 contract
Tax Indemnification and Other Tax Matters. (ai) Notwithstanding anything to the contrary in the this Agreement, Parent, Seller and NMT-US SoftDent Indemnifying Parties shall, jointly and severally, indemnify, save and hold harmless the Buyer SoftDent Indemnified Parties from and against any and all Damages damages, losses, costs, claims, expenses and liabilities including without limitation, interest, penalties, reasonable attorneys' fees and expenses, incurred in connection with, arising out of, resulting from or relating to (i) any fact inconsistent with, or any untruth, untruth or inaccuracy or breach of, any representation, representation or warranty of Dentsply or covenant of Parent, Seller, NMT-US or any of the Acquired Companies or the Seller Ceramco contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment)Section 3.12, 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to Ceramco and/or the Acquired Companies and the US-Based Assets SoftDent Business (A) with respect to all periods ending on or prior to the Closing Date, Date and (B) with respect to any period beginning before the Stub Tax Period. For Closing and ending after the purposes Closing Date, but only with respect to the portion of this Agreement, the such period from January 1, 2000 through up to and including the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter is (such portion shall be referred to herein as the "PostPRE-CLOSING TAX PERIOD" and the portion of such period after the Closing PeriodDate shall be referred to herein as the "POST-CLOSING TAX PERIOD")."
(bii) For purposes of this Section 14.39.1.B, Tax or Taxes shall include the amount of Taxes which would have been paid but for the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after the Closing Date. - 43 - 44
(iii) Any Taxes for a period including a Pre-Closing Tax Period and a Post-Closing Tax Period shall be apportioned between such Pre-Closing Tax Period and such Post-Closing Tax Period, based, in the case of real and personal property Taxes, on a per diem basis and, in the case of other Taxes, on the basis of a closing of the books as of the Closing Date.
(civ) For Without limiting the avoidance of doubt, the parties agree that the foregoing provisions of this Section 14.3 9.1.B, the definition of "SoftDent Indemnifiable Damages" above shall be interpreted and applied in such a manner such that none of Buyer, ISC include any claim or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled right to indemnification under pursuant to this Section 14.3 on the basis of said under-accrual).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, the Acquired Companies or Buyer, as the case may be, shall give notice thereof to Parent. Parent shall pay the amount of such Taxes Buyer (or Buyer's designee), within 30 days after the receipt of such notice.
(e) Parent and Buyer agree to give prompt notice to each other of any proposed adjustment to Taxes for periods ending on or prior to the Closing Date. Seller shall have the right to conduct any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs of the Acquired Companies; (ii) Buyer receives copies of all relevant material written correspondence from any Tax authority; (iii) no material written communication is sent to any Tax authority without first submitting in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayed); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall have the right at their option and expense to participate in any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s).9.1.B
Appears in 1 contract
Tax Indemnification and Other Tax Matters. (a) Notwithstanding anything to the contrary in the Agreement, Parent, Seller and NMT-US shall, jointly and severally, indemnify, save and hold harmless the Buyer Indemnified Parties from and against any and all Damages incurred in connection with, arising out of, resulting from or relating to (i) any fact inconsistent with, or any untruth, inaccuracy or breach of, any representation, warranty or covenant of Parent, Seller, NMT-US or any of the Acquired Companies or the Seller contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment), 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to the Acquired Companies and the US-Based Assets (A) with respect to all periods ending on or prior to the Closing Date, and (B) with respect to the Stub Tax Period. For the purposes of this Agreement, the period from January 1, 2000 through and including the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter is referred to herein as the "Post-Closing Period."
(b) For purposes of this Section 14.3, Tax or Taxes shall include the amount of Taxes which would have been paid but for the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after the Closing Date.
(c) For the avoidance of doubt, the parties agree that the provisions of this Section 14.3 shall be interpreted and applied in such a manner such that none of Buyer, ISC or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- under-accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled to indemnification under this Section 14.3 on the basis of said under-accrual).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, the Acquired Companies or Buyer, as the case may be, shall give notice thereof to Parent. Parent shall pay the amount of such Taxes Buyer (or Buyer's designee), within 30 days after the receipt of such notice.
(e) Parent and Buyer agree to give prompt notice to each other of any proposed adjustment to Taxes for periods ending on or prior to the Closing Date. Seller shall have the right to conduct any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs of the Acquired Companies; (ii) Buyer receives copies of all relevant material written correspondence from any Tax authority; (iii) no material written communication is sent to any Tax authority without first submitting in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayed); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall have the right at their option and expense to participate in any audit or proceeding with respect to Taxes involving the Acquired Companies for such period(s).
Appears in 1 contract
Samples: Purchase Agreement (Integra Lifesciences Holdings Corp)
Tax Indemnification and Other Tax Matters. (a) Notwithstanding anything to the contrary in the this Agreement, Parent, Seller and NMT-US shall, Warrantors jointly and severally, indemnify, save severally undertake to pay Buyer (A) an amount equal to any liability of the Company and hold harmless the Buyer Indemnified Parties from and against any and all Damages incurred of its Subsidiaries in connection with, arising out of, resulting from or relating to respect of (i) any fact inconsistent with, or any untruth, inaccuracy or breach of, any representation, warranty or covenant of Parent, Seller, NMT-US or any of the Acquired Companies or the Seller contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment), 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to of the Acquired Companies Company and the US-Based Assets any of its Subsidiaries (Aa) with respect to all Tax periods ending on or prior to the Closing DateDate (the “Pre-Closing Period”) and (b) with respect to any Tax period beginning before the Closing Date and ending after the Closing Date (the “Straddle Period”) but only with respect to the portion of such Tax period up to and including the Closing Date (such portion shall be referred to herein as the “Pre-Closing Partial Period” and the portion of such Tax period after the Closing Date shall be referred to herein as the “Post-Closing Partial Period”), (ii) any and all Taxes of the Company or any of its Subsidiaries arising from the Spin-Out, (iii) any Taxes arising from any breach of any warranty set forth in Sections 3.19 or 3.5(q), and (B) with respect an amount equal to any and all Taxes of any member of a consolidated, combined or unitary group of which the Stub Tax PeriodCompany and any of its Subsidiaries (or any of their predecessors) are or were a member on or before the Closing Date, including but not limited to, liabilities as meant in Section 39 (for corporate income tax purposes) and Section 43 (for VAT) of the Dxxxx Xxxxxxxxxx Xxx 0000 (Invorderingswet 1990) and liabilities imposed as a result of US Treasury Regulation Section 1.1502-6 or any similar provision of foreign, state or local law. For the purposes of this AgreementSection 12.1(a), references to any amounts in respect of Taxes shall be deemed to include amounts that would have been payable but for the set-off or other utilization of any loss, deduction or credits realized in, or attributable to, a period from January 1, 2000 through and including that ends after the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter is referred to herein as the "Post-Closing PeriodDate."
(b) For purposes of this Section 14.3allocating Taxes between a Pre-Closing Partial Period and a Post-Closing Partial Period, in the case of any Taxes that are imposed on a periodic basis and are payable for a Straddle Period, the portion of such Tax that relates to the Pre-Closing Partial Period shall (i) in the case of any property or ad valorem Taxes shall include other than Taxes based upon or related to income or receipts, be deemed to be the amount of Taxes such Tax for the entire Straddle Period multiplied by a fraction the numerator of which is the number of days in the Pre-Closing Partial Period and the denominator of which is the number of days in the entire Straddle Period, and (ii) in the case of any other Tax, including any Tax based upon or related to income or receipts, be deemed equal to the amount which would have been paid but for by payable if the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after relevant Straddle Period ended on the Closing Date.
(c) For the avoidance of doubt, the parties agree that the provisions of this Section 14.3 shall be interpreted and applied in such a manner such that none of Buyer, ISC or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled to indemnification under this Section 14.3 on the basis of said under-accrual).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after After the Closing Date. Seller or , Buyer Parent shall procure that the Company and its duly authorized agents Subsidiaries shall prepare and file all Returns in respect of Taxes for periods ending prior Pre-Closing Periods (for the purposes of this section 12.1(c) including Returns relating to or on Straddle Periods) that are filed after the Closing. Such Pre-Closing DateReturns, includingwhich are corporate income tax returns, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting periods ending on or before the Closing Date, subject to all such Returns (including workpapers) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland RevenueHoldings for prior approval, which approval is not to be unreasonably withheld, conditioned or delayed. If Holdings does not provide Buyer or Parent with its agents comments within 21 days after receipt of the request for approval then it shall be deemed to have any commentsgiven its approval. If Holdings disagrees with the Pre-Closing Return to be submitted, Seller it shall notify Buyer Parent of such disagreement in writing and the notice shall include a reasonably detailed description of the disagreement and its agents legal basis. Buyer Parent and Holdings shall not unreasonably refuse use their respective reasonable efforts to adopt resolve any such comments. Seller disagreement, and if no resolution is achieved within one (1) month, Holdings and Buyer Parent shall respectively afford (or procure mutually select an independent accounting firm in Amsterdam, The Netherlands, to resolve the disagreement, and such firm’s determination of the issue for which there is disagreement shall be afforded) to the other or their agents such information final and assistance as may reasonably be required to prepare, submit binding on Holdings and agree all relevant Tax ReturnsBuyer Parent. Buyer shall provide that the Acquired Companies shall cause the All Pre-Closing Returns (other than corporate income Returns) shall be prepared diligently and correspondence in good faith in a manner consistent with past practices (except as otherwise required by applicable law) and other documentation relating thereto) referred to in this Section to be authorizeda manner that takes into account the Sellers’ interests (and, signed and returned to Seller if the Return is prepared for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Datea Straddle Period, the Acquired Companies or Buyer, as interests of the case may be, shall give notice thereof to Parent. Parent shall pay the amount of such Taxes Buyer (or Buyer's designeeCompany and its Subsidiaries), within 30 days after the receipt of such notice.
(ed) Buyer, Buyer Parent and Buyer each Warrantor agree to give prompt notice to each other of any proposed adjustment to Taxes for periods ending on of the Company or prior any Subsidiary (including an adjustment to the amount of Tax losses) for any Pre-Closing DatePeriod or any Straddle Periods, provided that the failure of a party to give such prompt notice shall not relieve any party hereto of its indemnification obligations under this Article XII, except to the extent that such party is actually prejudiced thereby. Seller Buyer, Buyer Parent and the Warrantors shall cooperate with each other in the conduct of any audit or other proceeding involving the Company or any Subsidiary for a Pre-Closing Period or a Pre-Closing Partial Period and unless Holdings, on behalf of the Warrantors, agrees to control such audit or proceeding in accordance with this Section 12.1(d), Buyer Parent (or its designee) shall have the right to control any such audit or other proceeding, whereby Buyer Parent (or its designee) shall consider the Sellers’ interests diligently and in good faith and take into account any and all reasonable written requests from Holdings unless such requests prejudice the interests of the Company or the relevant Subsidiary in any material respect. Holdings, on behalf of the Warrantors, shall have the right to control the conduct of any audit or proceeding for any Pre-Closing Period which proposes any adjustment to the Taxes (as opposed to an adjustment for the amount of Tax losses) of the Company or any Subsidiary for any Pre-Closing Period if each Warrantor agrees in writing that any resulting Tax (and related Other Claim) that arises with respect to Taxes involving the Acquired Companies for Pre-Closing Period or the Pre-Closing Partial Period is covered by the indemnity set forth in Section 12.1(a) of this Agreement (such period(saudit or proceeding, a “Warrantors’ Contest”) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the Tax affairs Holdings, on behalf of the Acquired Companies; Warrantors, shall keep Buyer Parent informed regarding the progress and substantive aspects of any Warrantors’ Contest, (ii) Buyer receives copies of all relevant material written correspondence from any Tax authority; Holdings shall defend such Warrantors’ Contest diligently and in good faith as if it were the only party with an interest in such Warrantors’ Contest, (iii) no material Buyer Parent (or its designee) shall be entitled to participate at its own expense, in such Warrantors’ Contest and receive written communication copies of any written materials relating to such Warrantors’ Contest received from the relevant taxing authority and (iv) Holdings, on behalf of the Warrantors, shall not compromise or settle any Warrantors’ Contest, without obtaining Buyer Parent’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing, if the amount in dispute in connection with any Warrantors’ Contest, after taking into account any interest, penalty, addition to Tax that may be imposed by any Governmental Entity with respect to a Pre-Closing Period or a Pre-Closing Partial Period, is sent greater than two hundred percent (200%) of the remaining portion of the Retention Escrow Amount (excluding any portion thereof equal to the amount of outstanding Relevant Claims which have not been settled, which is referred to as an “Encumbered Portion”), Buyer Parent (or its designee) shall have the right to assume control of a Warrantors’ Contest from Holdings and shall have the right to direct and settle such Warrantors’ Contest (a “Buyer Controlled Warrantors’ Contest”), provided if the remaining portion of the Retention Escrow Amount that is not an Encumbered Portion is sufficient to cover at least fifty percent (50%) of the amount to be paid in settlement of such claim, after taking into account any interest, penalty, additions to Tax authority and other related costs, then Buyer Parent shall not settle a Buyer Controlled Warrantors’ Contest without first submitting in draft form to Buyer allowing reasonable time for comment obtaining the written consent of Holdings (on behalf of the Warrantors), such comments consent not to be unreasonably withheld, conditioned or delayed. In determining whether consent is unreasonably withheld or delayedconditioned with respect to any proposed settlement by a party under this subsection, the merits of the matters at issue shall be considered (and thus it shall not be reasonable for a party to withhold consent, for example, if the merits clearly favor the settlement position for which consent is requested); , as well as the relative amount of Taxes that would be paid by Warrantors (ivthrough the Retention Escrow Amount) on the one hand and Buyer, Buyer Parent, the Company and its Subsidiaries (without a compensating payment from Warrantors), on the other hand. To the extent that there is a conflict between the provisions of Section 10.4 and this Section 12.1(d), this Section 12.1(d) will take precedence if the claim is made under the Tax Indemnity.
(e) Promptly after the Company and its Subsidiaries or Buyer Parent or Buyer acquires actual knowledge of an amount of Taxes of the Company and its Subsidiaries due and unpaid with respect to any reasonable comments made by Pre-Closing Period or Straddle Period, Buyer are incorporated into Parent shall and shall procure that the Company and its Subsidiaries shall give notice of their claim with respect thereto to Holdings, which shall include details of the amount of such Taxes to be paid with respect to any Pre-Closing Period or the amount of such Taxes allocable to the Pre-Closing Partial Period and enclose a copy of the relevant document; portion of the Return in connection with such claim. Warrantors shall pay from the Retention Escrow Fund the amount of such Taxes to the Company, the Company’s Subsidiary or Buyer Parent, as the case may be, on the later of (i) the third day before the date on which such Taxes became due and (vii) nothing the thirtieth day after the receipt of such notice, provided that Warrantors shall oblige not be required to pay such Taxes to the extent that a provision or reserve for such Taxes is set forth in the Working Capital Statement and taken into account in determining the Closing Working Capital (but excluding any provision or reserve for deferred Taxes established to reflect timing differences between book ant Tax income). If Holdings disagrees with the computation of such amount, it shall notify Buyer Parent of such disagreement in writing. Buyer Parent and Holdings shall use their respective reasonable efforts to submit resolve any Return such disagreement, and if no resolution is achieved within one (1) month, Holdings and Buyer Parent shall mutually select an independent accounting firm in Amsterdam, The Netherlands, to resolve the disagreement. Such firm’s determination of the issue which is the subject of such disagreement shall be final and binding on Holdings and Buyer Parent. Upon resolution or determination of such issue, there shall be made a payment, if necessary, between Buyer Parent, on the one hand, and Holdings, on the other document unless it hand, in order to take into account the results of such resolution or determination.
(f) Except as set forth in Section 12.1(d), none of Holdings, Buyer Parent, Buyer, the Company and the Company’s Subsidiaries may settle or otherwise resolve any claim, audit or processing involving Taxes of the Company or its Subsidiaries for Pre-Closing Period or Pre-Closing Partial Period without the consent of the other party, which consent shall not be unreasonably withheld, conditioned or delayed. The covenants in this Article XII shall cease to apply with respect to Buyer Parent, Buyer and the Company and its Subsidiaries once all funds in the Retention Escrow Fund are released.
(g) Holdings and Buyer Parent and Buyer shall furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information and assistance (including access to books and records) relating to the Company and its Subsidiaries as is satisfied that it is accurate reasonably necessary for the preparation of any Return, claim for refund or audit, and complete in all material respects. the prosecution or defense of any claim, suit or proceeding relating to any proposed adjustment.
(h) In the event of a Tax refund granted to or a Tax benefit of a similar nature for the Sellers or any of its Tax Affiliates resulting from events relating to Buyer Parent, Buyer or the Acquired Companies Company or any of its Subsidiaries in a period ending after the Closing Date (excluding a Pre-Closing Partial Period), including, but not limited to, carry-back of losses, tax credits or other off-sets, the Sellers shall have fully compensate Buyer for the right at amount of the Tax refund or Tax benefit. The parties hereto agree that any such compensation will be treated by Buyer and Sellers on their option and expense Returns as adjustments to participate the Aggregate Purchase Price.
(i) The Tax Indemnity obligation of the Warrantors under this Article XII shall be reduced by the amount of any Pre-Closing Tax Refund net of any Taxes or expenses incurred in any audit or proceeding connection with respect to Taxes involving the Acquired Companies for receipt of such period(s).Pre-Closing Tax Refund (excluding expenses that
Appears in 1 contract
Samples: Share and Loan Note Purchase Agreement (PRA International)
Tax Indemnification and Other Tax Matters. (a) Notwithstanding anything Subject to the contrary limitation in Section 8.5(b)(i)(B), the Agreement, Parent, Seller and NMT-US shall, jointly and severally, indemnify, save and hold harmless the Indemnifying Parties will indemnify Buyer Indemnified Parties from for all Taxes of the Company and against any and all Damages incurred in connection with, arising out of, resulting from or relating its Subsidiaries to the extent such Taxes are not adequately provided for as current Taxes on the Closing Balance Sheet (i) any fact inconsistent with, or any untruth, inaccuracy or breach of, any representation, warranty or covenant of Parent, Seller, NMT-US or any of the Acquired Companies or the Seller contained in Sections 2.2(c) (with respect to the 1998/1999 Tax Make-Whole Payment), 3.7, 5.2(f)(vi), 5.9 or 5.11, and (ii) to the extent not covered in foregoing clause (i), paid under Section 2.2(c) or reflected in the accrual for Taxes (other than any accrual for deferred Taxes established to reflect timing differences between book and Tax income) on the Closing Date Balance Sheet, any and all Taxes attributable to the Acquired Companies and the US-Based Assets (A) with respect to all periods ending on or prior to the Closing Date, and (B) with respect to the Stub Tax Period. For the purposes of this Agreement, the period from January 1, 2000 through and including the Closing Date is referred to as the "Pre-Closing Period" and any period thereafter is referred to herein as the "Post-Closing Period."
(b) For purposes of this Section 14.3, Tax or Taxes shall include the amount of Taxes which would have been paid but for the application of any credit or net operating or capital loss deduction attributable to periods or portions of a period beginning after the Closing Date.
(c) For the avoidance of doubt, the parties agree that the provisions of this Section 14.3 shall be interpreted and applied in such a manner such that none of Buyer, ISC or any of the Acquired Companies shall be entitled to double or multiple recovery with respect to any Damages (i.e., to the extent that Buyer is paid out in full under Section 2.2(c) for an under- accrual of Taxes for the 1998 or 1999 Tax year, none of Buyer, ISC or any of the Acquired Companies shall be entitled to indemnification under this Section 14.3 on the basis of said under-accrual).
(d) Buyer or its duly authorized agents shall cause the Acquired Companies to prepare and file all Returns in respect of Taxes for periods ending after the Closing Date. Seller or its duly authorized agents shall prepare and file all Returns in respect of Taxes for periods ending prior to or on the Closing Date, including, without limitation, the Stub Tax Period. Seller or its duly authorized agents shall conduct the preparation, submission and agreement of all United Kingdom Tax Returns of the Acquired Companies (and correspondence and other documentation relating thereto) for all accounting taxable periods ending on or before the Closing Date, subject to all such Returns (including workpapersii) being submitted in draft form to Buyer or its duly authorized agents for comment and approval within a reasonable time before they are due to be sent to Inland Revenue. If Buyer or its agents have any comments, Seller and its agents shall taxable period not unreasonably refuse to adopt such comments. Seller and Buyer shall respectively afford (or procure to be afforded) to the other or their agents such information and assistance as may reasonably be required to prepare, submit and agree all relevant Tax Returns. Buyer shall provide that the Acquired Companies shall cause the Returns (and correspondence and other documentation relating thereto) referred to in this Section to be authorized, signed and returned to Seller for submission to the appropriate authority without undue or unreasonable delay. Nothing herein shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Promptly after the Acquired Companies or Buyer acquires actual knowledge of an amount of Taxes due and unpaid with respect to any period ending on or before the Closing Date, for the Acquired Companies portion of any Taxes attributable to such period ending on the Closing Date, and (iii) for which the Company or any Subsidiary may be liable under Treasury Regulation §1.1502-6 (or any similar provision of state, local, or foreign law) with respect to any combined, consolidated, affiliated, or unitary group other than any such group in which Buyer or any of its current Affiliates (or any of their respective successors) is a member, as a transferee or successor, by Contract, or otherwise; provided, however, that any Taxes of the Company or any Subsidiary resulting from the denial of any deduction, other than a denial pursuant to Section 280G of the Code, for the payment of any amounts to any Optionholder or Warrantholder pursuant to this Agreement, or for the payment of any Unamortized Financing Cost, or from the denial of any deduction for any Transaction Costs claimed on any Tax Return, will not be subject to this indemnity.
(b) For purposes of applying Section 6.2(a) to any period that includes but does not end on the Closing Date, (i) Taxes determined by reference to income, capital gains, gross income, gross receipts, sales, net profits, windfall profits, or similar items will be allocated between the portion of such period ending on the Closing Date and the portion of such period after the Closing Date based on the date on which the relevant items of income and expense accrued (i.e., an interim closing of the tax books as of the Closing Date), and (ii) liability for all other Taxes will be allocated between the portion of such period ending on the Closing Date and the portion of such period after the Closing Date in proportion to the number of days in each such portion of such period.
(c) Representative will have the exclusive right to prepare, or cause to be prepared and filed, and the Company will sign upon request by Representative, all Tax Returns and reports (including any amendments and refund claims with respect thereto) of the Company and its Subsidiaries with respect to Tax periods described in Section 6.2(a)(i), which Returns and reports will be prepared and filed timely on a basis consistent with existing procedures for preparing such Returns and reports and in a manner consistent with prior practice; provided, that the federal income Tax return for the last period described in Section 6.2(a)(i) will claim as a deduction to the maximum extent permitted by Law all Transaction Costs and payments hereunder to any Optionholder, Warrantholder, or employee of the Company, and the Company and each Subsidiary will elect to carry back any net operating losses reflected on such return, to the maximum extent permitted by Law; provided, further, that all such Returns and reports will not be filed until Buyer has had 20 days to review the Return or report proposed to be filed by the Seller Indemnifying Parties and has consented to the filing of such Return or report, such consent not to be unreasonably withheld, delayed, or conditioned. The Company will sign such Return or report upon request by Representative. The Company will provide Representative with all information, and access to all books and records, of the Company and its Subsidiaries, as necessary or requested by Representative in order to prepare and file, or cause to be prepared and filed, the Tax Returns and reports (including any amendments and refund claims with respect thereto) provided for above in this Section 6.2(c), and Representative will not be deemed to have breached this Agreement or have any liability whatsoever if it does not prepare, or cause to be prepared and filed, any Tax Returns and reports (including any amendments and refund claims with respect thereto) provided for above in this Section 6.2(c), or if any such Tax Returns and reports are incomplete or inaccurate, due to any failure of the Company to provide any such information or access to books and records. The Company will prepare and file all other Tax Returns and reports of the Company and its Subsidiaries due after the Closing Date, which Returns and reports, to the extent they relate to taxable periods beginning prior to, but including the Closing Date, and for the purpose of determining the liability of the Seller Indemnifying Parties for Taxes, will be prepared and filed timely and on a basis consistent with existing procedures for preparing such Returns and in a manner consistent with prior practice. The Company will bear the costs of preparing all the Returns and reports described in this Section 6.2(c), subject to Section 6.2(d). In the event the Seller Indemnifying Parties are liable under Section 6.2(a) for Taxes due in connection with the Returns and reports described in this Section 6.2, Buyer and Representative will deliver to the Escrow Agent a certificate signed by each of them instructing the Escrow Agent to pay to Buyer Indemnified Parties from the Indemnity Escrow Fund an amount equal to such Taxes. Anything in this Section 6.2(c) to the contrary notwithstanding, Representative will not have any control or participation rights with respect to the Returns and reports referenced in the first sentence of this Section 6.2(c) at and after the time there are no funds, or it becomes reasonably certain that there will be no funds, in the Indemnity Escrow Fund with which to make payments pursuant to Section 6.2(g).
(d) Representative, Buyer, and the Company will provide each other with such assistance as may reasonably be requested by the case may beother in connection with the preparation of any Return or report of Taxes, shall give notice thereof any amendment or refund claim with respect thereto, any audit or other examination by any Governmental Entity, or any Proceedings relating to Parentliabilities for Taxes. Parent shall pay the amount Any cost or expense of such Taxes Buyer cooperation will be paid by the party incurring such expense (and not by the requesting party). The Company will retain for the full period of any statute of limitations and provide the others with any records or Buyer's designee)information which may be relevant to such preparation, within 30 days after the receipt of such noticeaudit, examination, Proceeding, or determination.
(e) Parent Buyer represents and Buyer agree warrants to give prompt notice to each other Sellers that it is a member of any proposed adjustment to Taxes for periods ending an affiliated group filing a consolidated federal income Tax Return, and that it will take the position in its federal income Tax filings that the current taxable year of the Company and its corporate Subsidiaries will end on or prior to the Closing Date, thus making the current federal income Tax year of the Company and its corporate Subsidiaries a Tax period ending on the Closing Date for purposes of Section 6.2(a).
(f) If in connection with any examination, investigation, audit, or other Proceeding in respect of any Tax Return covering the operations of the Company or its Subsidiaries on or before the Closing Date, any Governmental Entity issues to the Company or any of its Subsidiaries a written notice of deficiency, a notice of reassessment, a proposed adjustment, an assertion of claim, or demand concerning the taxable period covered by such Return, Buyer will notify Representative of its receipt of such communication from the Governmental Entity within 30 Business Days after receiving such notice of deficiency, reassessment, adjustment, or assertion of claim or demand. No failure or delay of Buyer in the performance of the foregoing will reduce or otherwise affect the obligations or liabilities of the Seller shall Indemnifying Parties pursuant to this Agreement, except to the extent that such failure or delay will have adversely affected the ability of the Seller Indemnifying Parties to defend against any liability or claim for Taxes that the Seller Indemnifying Parties are obligated to pay hereunder. Except as provided below, Representative will, at its expense, have the exclusive right to conduct control the contest (a “Pre-Close Tax Contest”) of any audit such assessment, proposal, claim, reassessment, demand, or proceeding other Proceedings in connection with respect to Taxes involving the Acquired Companies for such period(s) provided that: (i) Buyer is kept fully informed of all relevant material matters relating to the any Tax affairs Return covering taxable periods of the Acquired Companies; Company or any of its Subsidiaries described in Section 6.2(a)(i), and the nonexclusive right to participate in the contest (iian “Other Tax Contest”) Buyer receives copies of all relevant material written correspondence from any such assessment, proposal, claim, reassessment, demand, or other Proceedings in connection with any Tax authority; (iii) no material written communication is sent to Return covering taxable periods of the Company or any Tax authority without first submitting of its Subsidiaries described in draft form to Buyer allowing reasonable time for comment (such comments not to be unreasonably withheld or delayedSection 6.2(a)(ii); (iv) any reasonable comments made by Buyer are incorporated into the relevant document; and (v) nothing shall oblige Buyer to submit any Return or other document unless it is satisfied that it is accurate and complete in all material respects. Buyer or the Acquired Companies shall its designee will have the nonexclusive right at their option and expense to participate in any audit Pre-Close Tax Contest, and Representative will forward copies of all correspondence and other documents it sends or proceeding receives in connection with any such contest to Buyer or its designee on a timely basis. Representative will not settle or resolve any issue related to Taxes in any Pre-Close Tax Contest if such settlement or resolution could have an adverse effect on Buyer or the Company for periods after the Closing Date, without Buyer’s written consent which will not be unreasonably withheld, delayed, or conditioned. Buyer will, at its expense, have the exclusive right to control the Other Tax Contests. Neither Buyer, nor any Buyer Indemnified Party, nor the Company will settle or resolve any issue related to Taxes in any Other Tax Contest that results in a liability of the Seller Indemnifying Parties under Section 6.2(a) without Representative’s written consent which will not be unreasonably withheld, delayed, or conditioned. Representative, Buyer Indemnified Parties, and the Company will each bear its own costs and expenses incurred in connection with their participation in any Proceeding described in this Section 6.2(f). Anything in this Section 6.2(f) to the contrary notwithstanding, Representative will not have any control or participation rights with respect to any Pre-Close Tax Contest or Other Tax Contest at and after the time there are no funds, or it becomes reasonably certain that there will be no funds, in the Indemnity Escrow Fund with which to make payments pursuant to Section 6.2(g).
(g) If there is an adjustment to any Return or report of Taxes involving for the Acquired Companies Company or any of its Subsidiaries that creates a deficiency in any Taxes for which the Seller Indemnifying Parties are liable under the provisions of Section 6.2(a), Buyer and Representative will deliver to the Escrow Agent a certificate signed by each of them instructing the Escrow Agent to pay to Buyer Indemnified Parties from the Indemnity Escrow Fund an amount equal to such deficiency. Such payments from the Indemnity Escrow Fund constitute the exclusive means to satisfy the liabilities of the Seller Indemnifying Parties pursuant to this Article VI, and the Buyer Indemnified Parties will have no recourse against the Seller Indemnifying Parties for any such liability whether or not the Indemnity Escrow Fund is sufficient for such period(spurpose.
(h) The Sellers will be entitled to any overpayments of Taxes, and any related interest, attributable to any taxable period or portion thereof described in Section 6.2(a), that are received by the Company or any Subsidiary as refunds or that are credited for the benefit of the Company or any Subsidiary or Buyer Indemnified Parties against any Tax liability for any subsequent taxable period, but only to the extent such overpayments in the aggregate exceed the sum of the Tax Benefit Payment (as defined in Section 6.2(i)) plus, as determined at the end of the applicable statute of limitations, any underpayment of Taxes that would have been a liability of the Seller Indemnified Parties that would otherwise be payable by the Seller Indemnifying Parties or from the Indemnity Escrow Fund but for the limitations set forth in Section 6.2(a) and (g) (the “Tax Underpayment”). Promptly upon receipt of any such refund or application of such credit, Buyer will, or will cause the Company or a Subsidiary to, promptly notify Representative and, at the time, and from time to time, if ever, when the aggregate amount of such refunds and credits exceed the sum of the Tax Benefit Payment and the Tax Underpayment, if any, promptly pay to Representative an amount in cash equal to such excess plus any such interest attributable to such excess for disbursement to Sellers according to their Proportionate Shares. With respect to taxable periods described in Section 6.2(a)(ii) and (iii), only the part of a refund attributable to the portion of such taxable periods that ends on the Closing Date is subject to this Section 6.2(h). For purposes of this Section 6.2(h), the “applicable statute of limitations” means the statutes of limitations applicable to the Company and its Subsidiaries.
(i) At Closing, Buyer will pay to Representative (for disbursement to the Sellers according to their Proportionate Shares) an amount in cash equal to $6,515,000 (the “Tax Benefit Payment”). For the avoidance of doubt, anything in this Agreement to the contrary notwithstanding, (i) in the event the Company or any Subsidiary has a net operating loss carryover for federal income Tax purposes (or any state or local Tax equivalent thereof) from any taxable period described in Section 6.2(a)(i) that is carried over to, and utilized to reduce Taxes paid by any Person, in any subsequent taxable period, Sellers will not be entitled to any payment or other benefit resulting from such net operating loss carryover utilization, and (ii) neither Representative nor Sellers nor the Seller Indemnifying Parties will ever be required under any circumstances to directly or indirectly return or refund any portion of the Tax Benefit Payment or indemnify any party therefor except pursuant to an indemnity obligation under Section 6.2(a) caused by the denial of a deduction under Section 280G of the Code.
(j) This Section 6.2, together with the provisions of Article VIII that specifically reference and apply to this Article VI, provide the exclusive indemnity for any Taxes.
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