Common use of Tax Indemnities Clause in Contracts

Tax Indemnities. (b) (1) Except as provided in Section 6.13(a)(ii), Penobscot shall be liable for, and agrees to defend, hold harmless and indemnify BHE from and against any and all Indemnifiable Losses with respect to any and all Taxes of, or attributable to, PHC with respect to any period, or portion thereof, ending on or before the First Closing date ("Pre-Closing Periods") up to the aggregate amount of the Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIII. (1) BHE shall be liable for, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses with respect to: (A) any and all Taxes of or attributable to PHC with respect to any Pre-Closing Period (including any Taxes incurred as a result of making the Section 338(h)(10) election), but only to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period, including, but not limited to, any such Taxes for which PHC is or may be or become liable for by contract, as transferor, transferee, or successor, or under any applicable law (including, but not limited to, Treasury Regulation Section 1.1502-6 or 1.1502-78(b)(2) or any similar provision under any applicable foreign, state or local law), or otherwise. The indemnification obligations of BHE contained in this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIII. (1) In the case of any Tax described in Section 6.13(a)(ii)(A) that relates to any taxable period of PHC that begins on or before the First Closing Date but does not end on or before the First Closing Date (a "Straddle Period"), the portion of the Tax attributable to PHC or for which PHC may be liable for each of the Pre-Closing Period and the portion of such taxable period beginning after the First Closing Date (the "Post-Closing Period") shall be determined as follows: (A) In the case of any franchise or similar Tax that is not based upon or measured by net income and any ad valorem Tax, the portion attributable to the Pre-Closing Period shall be the amount of the Tax for the entire taxable period multiplied by a fraction the numerator of which is the number of days in the Pre-Closing Period and the denominator of which is the number of days in the entire taxable period. (B) In the case of any such Tax not described in Section 6.13(a)(iii)(A), the portion attributable to the Pre-Closing Period shall be determined on the basis of an interim closing of the books as of and including the First Closing date in accordance with the next two sentences. For purposes of this Section 6.13(a)(iii)(B), the portion of the Tax allocable to the Pre-Closing Period shall be the product of (x) the Tax for the entire taxable period, multiplied by (y) a fraction, the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Post-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the Post-Closing Period.

Tax Indemnities. (b) (1a) Except to the extent accrued as provided a liability reflected in Section 6.13(a)(ii)Closing Net Working Capital as contained in the Final Purchase Price, Penobscot Seller shall be liable for, responsible for and agrees to defend, shall indemnify and hold the Company and Buyer harmless and indemnify BHE from and against (i) all Taxes imposed on or payable by the Company for any and all Indemnifiable Losses taxable period (or portion thereof) that ends on or before the Closing Date; (ii) with respect to any and Straddle Period, all Taxes ofimposed on or payable by the Company which are allocable pursuant to Section 10.2(e) to the portion of such period ending on the Closing Date; (iii) all Taxes for which the Company is held liable by reason of the Company being included in any consolidated or affiliated group with Seller (or any Affiliates of Seller) (within the meaning of Section 1504(a) of the Code or any similar group defined under a similar provision of state, local or attributable to, PHC with respect to foreign law) at any period, or portion thereof, ending time on or before the First Closing date ("Pre-Closing Periods") up to the aggregate amount of the Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIII. (1) BHE shall be liable forDate, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses with respect to: (A) any and all Taxes of or attributable to PHC with respect to any Pre-Closing Period (including any Taxes incurred as a result of making the Section 338(h)(10) election), but only to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period, including, but not limited to, any such Taxes for which PHC is or may be or become liable for by contract, as transferor, transferee, or successor, or under any applicable law (including, but not limited to, Treasury Regulation Section 1.1502-6 6; and (iv) all Taxes of any Person other than the Company imposed on the Company as a transferee, indemnitor, or 1.1502-78(b)(2successor, by Contract (other than a Contract the primary subject matter of which is not Taxes) or any similar provision under any applicable foreign, state or local law), or otherwise. The indemnification obligations of BHE contained in this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIII. (1) In the case of pursuant to any Tax described in Section 6.13(a)(ii)(A) that relates law, which Taxes relate to any taxable period of PHC that begins an event or transaction occurring on or before the First Closing Date but does not end on or before Date. For the First Closing Date (a "Straddle Period")avoidance of doubt, the portion of the Tax attributable to PHC or for which PHC may be liable for each of the Pre-Closing Period and the portion of such taxable period beginning after the First Closing Date (the "Post-Closing Period"no indemnity payment made under this Section 10.3(a) shall be determined as follows:subject to any cap, deductible or other limitation. (Ab) In Buyer shall be responsible for all Taxes imposed on or payable by the Company that are not otherwise specified in Section 10.3(a). (c) Payment by the indemnifying party of any amount due under Section 10.3(a) shall be made at the time and in the manner specified in Section 10.2(e); provided, that in the case of any franchise or similar a Tax that is not based upon or measured by net income and any ad valorem Tax, the portion attributable to the Pre-Closing Period shall be the amount of the Tax for the entire taxable period multiplied by a fraction the numerator of which is the number of days in the Pre-Closing Period and the denominator of which is the number of days in the entire taxable period. (B) In the case of any such Tax not described in Section 6.13(a)(iii)(A), the portion attributable to the Pre-Closing Period shall be determined on the basis of an interim closing of the books as of and including the First Closing date contested in accordance with the next two sentences. For purposes provisions of this Section 6.13(a)(iii)(B10.2(f), the portion payment of the Tax allocable to the Pre-Closing Period shall appropriate Taxing Authority will be considered to be due no earlier than the product of (x) date a final determination to such effect is made by the Tax for the entire taxable period, multiplied by (y) a fraction, the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Post-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the Post-Closing Periodappropriate Taxing Authority or court.

Tax Indemnities. (b) (1a) Except as provided in Section 6.13(a)(ii)The Shareholders shall, Penobscot shall on a pro rata basis, be liable responsible for, shall pay or cause to be paid, and agrees to defendshall indemnify, defend and hold harmless Acquirer and indemnify BHE from its Affiliates against and against any reimburse Acquirer and all Indemnifiable Losses with respect to its Affiliates for any and all Taxes ofthat may be imposed upon or assessed against PPRX, PRXA or attributable to, PHC with respect to any period, their respective assets (other than Taxes disclosed in the Financial Statements provided for in the books and records of PPRX or portion thereof, ending PRXA and set forth on or before the First Closing date Company Disclosure Schedule): ("Pre-Closing Periods"i) up to the aggregate amount of the Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIII. (1) BHE shall be liable for, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses with respect to: (A) any and all Taxes of or attributable to PHC with respect to any Pre-Closing Period (including any Taxes incurred as a result of making the Section 338(h)(10) election), but only to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period; (ii) arising by reason of any breach or inaccuracy of the representations contained in Section 3.11 hereof; (iii) with respect to any and all Taxes of any member of an Affiliated Group of which PPRX , includingPRXA (or any predecessor thereof) is or was a member on or prior to the Closing Date, but not limited to, including any such Taxes for which PHC is each of PPRX or PRXA may be or become liable for by contract, as transferor, transferee, or successor, or under any applicable law (including, but not limited to, Treasury Regulation Section 1.1502-6 or 1.1502-78(b)(2) of the Treasury regulations promulgated under the Code (or any similar provision of state, local or foreign Law); (iv) with respect to any Taxes arising as a result of the Section 338(h)(10) Elections; (v) all recordation, sales, use, stamp, filing, transfer, documentary or similar fees or Taxes under Maine or Federal law relating to the transactions contemplated by this Agreement; or (vi) by reason of being a successor-in-interest or transferee of another Person prior to the Closing. In respect of the Section 338(h)(10) elections, any applicable foreign, state or local law), or otherwise. The indemnification obligations liabilities of BHE contained in the Shareholders hereunder shall be reduced by the amount of unfunded liabilities of Acquirer under this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIIIXII. (1b) Acquirer shall be responsible for, shall pay or cause to be paid, and shall indemnify, defend and hold harmless the Shareholders against and reimburse the Shareholders for all Taxes that they may at any time suffer or incur, or become subject to, as a result of, or in connection with, PPRX or PRXA with respect to Post-Closing Periods. (c) Payment by the indemnitor of any amount due to the indemnitee under this Section 12.01 shall be made within 10 days following written notice by the indemnitee that payment of such amount to the appropriate Tax authority is due by the indemnitee; provided, that the indemnitor shall not be required to make any payment earlier than two Business Days before it is due to the appropriate Tax authority. In the case of a Tax that is contested in accordance with the provisions of Section 12.02 payment of the Tax to the appropriate Tax authority will not be considered to be due earlier than the date that a final determination to such effect is made by such Tax authority or a court. Payments under this Article XI shall not be subject to the threshold set forth in Section 11.02(b) or the limitation set forth in Section 11.02(c). (d) For purposes of this Agreement, "Pre-Closing Period" shall mean a taxable period or portion thereof that ends on or prior to the Closing Date. If a taxable period begins on or prior to the Closing Date and ends after the Closing Date, then the portion of the taxable period that ends on (and including) the Closing Date shall constitute a Pre-Closing Period. In the case of any Tax described in Section 6.13(a)(ii)(A) that relates to any taxable is imposed on a periodic basis and is payable for a period of PHC that begins on or before the First Closing Date but does not end on or before and ends after the First Closing Date (a "Straddle Period")Date, the portion of such Taxes payable for the Tax attributable to PHC or for which PHC may be liable for each of the Pre-Pre- Closing Period and the portion of such taxable period beginning after the First Closing Date (the "Post-Closing Period") shall be determined as follows: (Ai) In in the case of any franchise or similar Tax that is not other than a Tax based upon or measured by net income and any ad valorem Taxincome, the portion attributable to the Pre-Closing Period shall be the amount of the such Tax for the entire taxable period multiplied by a fraction fraction, the numerator of which is the number of days in the Pre-period ending on the Closing Period Date and the denominator of which is the number of days in the entire period and (ii) in the case of any Tax based upon or measured by income, the amount which would be payable if the taxable period. year ended on the Closing Date. Any credit shall be prorated based upon the fraction employed in clause (Bi) of the preceding sentence. In the case of any such Tax not described in based upon or measured by capital (including net worth or long- term debt) or intangibles, any amount thereof required to be allocated under this Section 6.13(a)(iii)(A), the portion attributable 12.01(d) shall be computed by reference to the Pre-Closing Period shall be determined level of such items on the basis of an interim closing of the books as of and including the First Closing date in accordance with the next two sentencesDate. For purposes of this Section 6.13(a)(iii)(B)Agreement, the portion of the Tax allocable to the Pre-Closing Period shall be the product of (x) the Tax for the entire taxable period, multiplied by (y) a fraction, the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Post-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the "Post-Closing Period" means any period other than a Pre-Closing Period.

Tax Indemnities. (b) a) The Seller shall be responsible for, shall pay or cause to be paid, and shall indemnify and hold harmless the Purchaser against and reimburse the Purchaser for all Taxes (1other than conveyance taxes which are allocated to the Purchaser pursuant to Section 7.4) Except as provided arising in connection with the Business or the Assets (including with respect to a breach of the representation and warranty contained in Section 6.13(a)(ii), Penobscot shall be liable for, and agrees to defend, hold harmless and indemnify BHE from and against any and all Indemnifiable Losses 3.13) with respect to any Tax period or portion thereof that ends on or before the Closing Date; provided, however, that no indemnity shall be provided under this Agreement for any Taxes resulting from a breach by the Purchaser of its representations, warranties or obligations under this Agreement. (b) From and after the Closing Date, the Purchaser shall be responsible for, shall pay or cause to be paid, and shall indemnify, defend and hold harmless the Seller against and reimburse the Seller for all Taxes ofthat the Seller may at any time suffer or incur, or attributable become subject to, PHC as a result of or in connection with the Business or the Assets that are not subject to indemnification pursuant to paragraph (a) of this Section 7.1. (c) Payment by the indemnitor of any amount due to the indemnitee under this Section 7.1 shall be made within 10 days following written notice by the indemnitee that payment of such amounts to the appropriate Tax authority is due by the indemnitor, provided -------- that the indemnitor shall not be required to make any payment earlier than two days before it is due to the appropriate Tax authority. If Seller receives an assessment or other notice of Tax due with respect to any period, Asset or portion thereof, the Business for any period ending on or before the First Closing date ("Pre-Closing Periods") up Date for which the Seller is not responsible, in whole or in part, pursuant to Section 7.1(a), and Seller pays such Tax, then the Purchaser shall pay to the aggregate Seller in accordance with the first sentence of this Section 7.1(c), the amount of the such Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIIIfor which Seller is not responsible. (1d) BHE shall be liable forFor purposes of this Agreement, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses with respect to: (A) any and all Taxes of or attributable to PHC with respect to any Pre-Closing Period (including any Taxes incurred as a result of making the Section 338(h)(10) election), but only to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period, including, but not limited to, any such Taxes for which PHC is or may be or become liable for by contract, as transferor, transferee, or successor, or under any applicable law (including, but not limited to, Treasury Regulation Section 1.1502-6 or 1.1502-78(b)(2) or any similar provision under any applicable foreign, state or local law), or otherwise. The indemnification obligations of BHE contained in this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIII. (1) In the case of any Tax described in Section 6.13(a)(ii)(A) that relates to any taxable is imposed on a periodic basis and is payable for a period of PHC that begins on or before the First Closing Date but does not end on or before and ends after the First Closing Date (a "Straddle Period")Date, the portion of such Taxes payable for the Tax attributable to PHC or for which PHC may be liable for each of period ending on the Pre-Closing Period and the portion of such taxable period beginning after the First Closing Date (the "Post-Closing Period") shall be determined as follows: (Ai) In in the case of any franchise or similar Tax that is not other than a Tax based upon or measured by net income and any ad valorem Taxincome, the portion attributable to the Pre-Closing Period shall be the amount of the such Tax for the entire taxable period multiplied by a fraction fraction, the numerator of which is the number of days in the Pre-period ending on the Closing Period Date and the denominator of which is the number of days in the entire taxable period. period and (Bii) in the case of any Tax based upon or measured by income, the amount that would be payable based on the actual operation of the Business during the portion of such period ending on the Closing Date. Any Tax credit shall be prorated based upon the fraction employed in clause (i) of the preceding sentence. In the case of any such Tax not described in based upon or measured by capital (including net worth or long-term debt) or intangibles, any amount thereof required to be allocated under this Section 6.13(a)(iii)(A), the portion attributable 7.1(d) shall be computed by reference to the Pre-level of such items on the Closing Period Date. (e) The indemnification obligations hereunder relate solely to Taxes and not to any other Losses which a party may incur in connection with the defense or contest of any Tax audits or proceedings, and each party waives the right to seek indemnification for such other Losses under any other provision of this Agreement. (f) Any amount payable under this Article 7 shall be made net of any Tax benefit enjoyed by the indemnitee, determined on the basis of an interim closing of the books as of and including the First Closing date in accordance a manner consistent with the next two sentences. For purposes last sentence of this Section 6.13(a)(iii)(B), the portion of the Tax allocable to the Pre-Closing Period shall be the product of (x) the Tax for the entire taxable period, multiplied by (y) a fraction, the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Post-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the Post-Closing Period10.5 hereof.

Tax Indemnities. (b) i) From and after the Closing Date, without duplication and subject to (1S)8 hereof (but without regard to the limitations in (S)8(b)(i)(A) Except as provided in Section 6.13(a)(iiand (B) hereof), Penobscot the Parent and the Seller shall be liable forindemnify the Buyer and the Company and their Affiliates against all Taxes (including reasonable attorneys' and accountants' fees and other reasonable out-of-pocket expenses incurred in connection therewith, and agrees but reduced by any Tax benefit that the Buyer, the Company or their Affiliates realize as a result of the payment (or the adjustment giving rise to defend, hold harmless and indemnify BHE from and against the payment) of any and all Indemnifiable Losses such Taxes) imposed on or payable by the Company or any of its Subsidiaries (A) with respect to any taxable period or portion thereof that ends on or before the Closing Date (including any Taxes allocated to such period under (S)9(a)(iv) hereof); (B) under Treasury Regulation (S)1.1502-6 (or any similar provision of state, local or foreign law) by reason of the Company or any of its Subsidiaries being included in any consolidated, affiliated, combined or unitary or other similar group of which the Parent is the common parent at any time on or before the Closing Date, (C) pursuant to any contract or agreement with any third party for indemnification of Taxes or (D) without duplication, any Taxes arising from a breach of representation contained in (S)4(j); other than any Taxes included as a liability in Closing Working Capital. No indemnity shall be provided under this Agreement for any Taxes resulting from any transaction of the Company or any of its Subsidiaries occurring after the Closing Date or on the Closing Date after the Closing that is not in the Ordinary Course of Business. (ii) From and after the Closing Date, without duplication, the Buyer shall, and shall cause the Company to, indemnify the Parent and its Affiliates against all Taxes (including reasonable attorneys' and accountants' fees and other reasonable out-of-pocket expenses incurred in connection therewith) imposed on the Company and its Subsidiaries, which Taxes are not subject to indemnification pursuant to (S)9(a)(i), including Taxes (A) resulting from any transaction of the Company and its Subsidiaries occurring after the Closing Date or attributable toon the Closing Date after the Closing that is not in the Ordinary Course of Business, PHC (B) with respect to any period, taxable period or portion thereof, ending on or before the First Closing date ("Pre-Closing Periods") up to the aggregate amount of the Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIII. (1) BHE shall be liable for, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, thereof that begins after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses with respect to: (A) any and all Taxes of or attributable to PHC with respect to any Pre-Closing Period Date (including any Taxes incurred allocated to such period under (S)9(a)(iv) hereof) or (C) included as a result liability in Closing Working Capital. (iii) Payment by the indemnitor of making any amount due under this (S)9 shall be made within ten days following written notice by the Section 338(h)(10) electionindemnitee that payment of such amounts to the appropriate Tax Authority is due, provided that the indemnitor shall not be required to make any payment earlier than two days before it is due to the appropriate Tax Authority. If the Parent receives an assessment or other notice of Taxes due with respect to the Company or any of its Subsidiaries for any period for which the Parent is not responsible, in whole or in part, pursuant to (S)9(a)(i), but only then the Buyer shall pay such Tax, or if the Parent pays such Tax, then the Buyer or the Company shall pay to the Parent, in accordance with the first sentence of this (S)9(a)(iii), the amount of such Tax for which the Parent is not responsible. In the case of a Tax that is contested in accordance with the provisions of (S)9(c), payment of the Tax to the appropriate Tax Authority will not be considered to be due earlier than the date a final determination to such effect is made by the appropriate Tax Authority or court. Final determination shall have the meaning as set forth in (S)1313(a) of the Code. (i) The Parent and the Buyer shall, to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period, including, but not limited to, any such Taxes for which PHC is or may be or become liable for permitted by contract, as transferor, transferee, or successor, or under any applicable law (includingand except as otherwise provided herein, but not limited toelect with the relevant Tax Authority to close the taxable period of the Company and its Subsidiaries at the end of the day on the Closing Date. For purposes of this Agreement, Treasury Regulation Section 1.1502-6 or 1.1502-78(b)(2) or any similar provision under any applicable foreign, state or local law), or otherwise. The indemnification obligations of BHE contained in this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIII. (1) In the case of any Tax described in Section 6.13(a)(ii)(A) that relates to any is imposed on a periodic basis and is payable for a taxable period of PHC that begins on or before the First Closing Date but does not end on or before and ends after the First Closing Date (a "Straddle Period")Date, the portion of the Tax attributable to PHC or such Taxes which is payable for which PHC may be liable for each of the Pre-Closing Period and the portion of such taxable period beginning after ending on the First Closing Date (the "Post-Closing Period") shall be determined as follows: (A) In in the case of any franchise or similar Tax that is not other than a Tax based upon or measured by net income and any ad valorem Taxor receipts, the portion attributable to the Pre-Closing Period shall be the amount of the such Tax for the entire taxable period (or, in the case of such Taxes determined on an arrears basis, the amount of such Tax for the immediately preceding period) multiplied by a fraction fraction, the numerator of which is the number of days in the Pre-portion of such taxable period ending on the Closing Period Date and the denominator of which is the number of days in the entire taxable period. period and (B) in the case of a Tax based upon or measured by income or receipts, the amount which would be payable if the relevant taxable period ended on the Closing Date. Any credit or refund resulting from an overpayment of Taxes shall be prorated based upon the method employed in the immediately preceding sentence. In the case of any such Tax not described in Section 6.13(a)(iii)(A)based upon or measured by capital (including net worth or long-term debt) or intangibles, the portion attributable any amount thereof required to be allocated under this (S)9(a)(iv) shall be computed by reference to the Prelevel of such items on the Closing Date. The taxable period of any partnership or other pass-Closing Period through entity in which the Company or any Subsidiary is a partner or other beneficial interest holder shall be determined deemed to terminate on the basis of an interim closing Closing Date. All determinations necessary to effect the foregoing allocations shall be made in a manner consistent with prior practice of the books as of Company and including the First Closing date in accordance with the next two sentences. For purposes of this Section 6.13(a)(iii)(B), the portion of the Tax allocable to the Pre-Closing Period shall be the product of (x) the Tax for the entire taxable period, multiplied by (y) a fraction, the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Post-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the Post-Closing Periodits Subsidiaries.

Tax Indemnities. (b) (1a) Except as provided in Section 6.13(a)(ii)From and after the Closing Date, Penobscot Parent shall be liable responsible for, shall pay or cause to be paid, and agrees to defendshall indemnify, defend and hold harmless CS and indemnify BHE from the Beverage Companies against and against reimburse CS and the Beverage Companies for: (i) any and all Indemnifiable Losses Tax with respect to any and Tax period or portion thereof that ends on or before the Closing Date for which any Beverage Company may be liable under Section 1.1502-6 of the Treasury Regulations (or any similar provision of state, local or foreign law); (ii) all income Taxes of, (or attributable to, PHC Taxes based on net income) ("INCOME TAXES") of the Beverage Companies with respect to any period, Tax period or portion thereof, ending thereof that ends on or before the First Closing date Date in excess of $3,468,000 ("Pre-Closing Periods") up to the aggregate amount of the Tax Accrual. The indemnification obligations of Penobscot contained in this Section 6.13(a)(i) are separate from Penobscot's obligations in Article VIII. (1) BHE shall be liable for, and agrees to defend, hold harmless and indemnify Penobscot and its Affiliates (including, after the Second Closing date, PHC) from and against, any and all Indemnifiable Losses federal tax benefits computed at 35% with respect to: (Ato $2,815,000 of such amount);1/(iii) any and all Taxes of or attributable to PHC the Beverage Companies other than Income Taxes with respect to any Pre-Tax period or portion thereof that ends on or before the Closing Period Date and other than Conveyance Taxes (including as defined in Section 8.6) in excess of the sum of (x) the aggregate accruals for current Taxes (other than Income Taxes) not yet due and payable on the 3.7 Balance Sheets hereof, (y) accruals in the ordinary course of business after July 2, 2000 and (z) $831,000 (after federal tax benefits computed at 35% with respect to $650,000 of such amount)2/; (iv) any Income Tax of the Beverage Companies with respect to any Tax period or portion thereof that ends on or before the Closing Date, arising out of, resulting from or related to, the elections under Sections 338 and 338(h)(10) of the Code provided for in the Tax Agreement and; (v) any Tax of the Beverage Companies with respect to any Tax period or portion thereof that ends on or before the Closing Date arising out of, resulting from or related to the Restructuring; PROVIDED, HOWEVER, that no indemnity shall be provided under this Agreement by Parent for any Tax resulting from any transaction of the Beverage Companies occurring on the Closing Date but after the Closing that is not in the ordinary course of business or is not provided for in the Tax Agreement. At the election of Parent, made at any time, 50% of any number set forth in this Section 8.1(a)(ii) may be reduced (or increased) and a corresponding increase (or reduction) made to the corresponding number set forth in Clause (z) of Section 8.1(a)(iii). Any obligation for indemnity provided for in Section 8.1(a)(iii) shall be subject to and limited by the provisions of Section 7.5 and shall be included as a Loss under those provisions. (b) From and after the Closing Date, CS and the Beverage -------- [FN] 1/ $2,815,000 of reserves for income taxes and $653,000 of interest thereon. 2/ $650,000 of reserves for other taxes plus $181,000 of interest thereon. Companies shall, jointly and severally, be responsible for, shall pay or cause to be paid, and shall indemnify, defend and hold harmless Merging Companies and their Affiliates against and reimburse Parent and its Affiliates for all Taxes incurred Parent and its Affiliates may at any time suffer or incur, or become subject to, as a result of making or in connection with the Beverage Companies that are not subject to indemnification pursuant to paragraph (a) of this Section 338(h)(10) election8.1 (other than Conveyance Taxes), but only to the extent the aggregate amount of such other Taxes exceeds the Tax Accrual; and (B) any Taxes of any corporation or other Person, that is or was affiliated with PHC, with respect to any Pre-Closing Period, including, but not limited to, Taxes resulting from any transaction of the Beverage Companies occurring on the Closing Date but after the Closing that is not in the ordinary course of business or is not provided for in the Tax Agreement. CS agrees to comply with all provisions of Article VIII of the Stock Purchase Agreement ("QUAKER AGREEMENT") between the Quaker Oats Company ("QUAKER") and Parent, dated as of March 27, 1997 required for Parent to obtain indemnification for Taxes from Quaker pursuant to Article VIII of the Quaker Agreement and promptly to pay over to Parent all taxes received by or credited to a Beverage Company which Parent is obligated to pay to Quaker pursuant to the Quaker Agreement; PROVIDED, HOWEVER, no such Taxes for which PHC is or may be or become liable for by contract, as transferor, transferee, or successor, or under any applicable law (including, but not limited to, Treasury Regulation Section 1.1502-6 or 1.1502-78(b)(2) or any similar provision under any applicable foreign, state or local law), or otherwise. The payment shall reduce Parent's indemnification obligations of BHE contained in this Section 6.13(a)(ii) are separate from BHE's obligations in Article VIIIobligation to CS hereunder. (1c) Payment by an indemnitor of any amount due to an indemnitee under this Section 8.1 shall be made within 10 days following written notice by the indemnitee that payment of such amounts to the appropriate Tax authority is due by the indemnitee, provided that the indemnitor shall not be required to make any payment earlier than five days before it is due to the appropriate Tax authority. In the case of a tax that is contested in accordance with the provisions of Section 8.3, payment of the Tax to the appropriate Tax authority will not be considered to be due earlier than the date a final determination to such effect is made by such Tax authority or a court. (d) For purposes of this Agreement (including without limitation determining Parent's indemnification obligations under Section 8.1(a)), in the case of any Tax described in Section 6.13(a)(ii)(A) that relates to any taxable is imposed on a periodic basis and is payable for a period of PHC that begins on or before the First Closing Date but does not end on or before and ends after the First Closing Date (a "Straddle Period")Date, the portion of such Taxes payable for the Tax attributable to PHC or for which PHC may be liable for each of period ending on the Pre-Closing Period and the portion of such taxable period beginning after the First Closing Date (the "Post-Closing Period") shall be determined as follows: (Ai) In in the case of any franchise or similar Tax that is not other than a Tax based upon or measured by net income and any ad valorem Taxincome, the portion attributable to the Pre-Closing Period shall be the amount of the such Tax for the entire taxable period multiplied by a fraction fraction, the numerator of which is the number of days in the Pre-period ending on the Closing Period Date and the denominator of which is the number of days in the entire period; PROVIDED, HOWEVER, that (x) if any property, asset or other right of a Beverage Company is sold or otherwise transferred prior to the Closing Date, then ad valorem Taxes pertaining to such property, asset or other right shall be attributed entirely to the pre-Closing period, and (y) if any property, asset or other right of a Beverage Company is purchased or otherwise acquired after the Closing Date, then ad valorem Taxes pertaining to such property, asset or other right shall be attributed entirely to the post-Closing period, and (ii) in the case of any Tax based upon or measured by income, the amount which would be payable if the taxable year ended as of the close of the Closing Date, PROVIDED, HOWEVER, that any Tax resulting from the departure of a Beverage Company from an affiliated, combined or consolidated group in which it was a member in a pre-Closing period (resulting from the triggering into income of deferred intercompany transactions under Section 1.1502-13 of the Treasury regulations or excess loss accounts under Section 1.1502-19 of the Treasury regulations or otherwise) shall be allocated to a pre-Closing period. (B) . In the case of any such Tax not described in based upon or measured by capital (including net worth or long-term debt) or intangibles, any amount thereof required to be allocated under this Section 6.13(a)(iii)(A), the portion attributable 8.1(d) shall be computed by reference to the Pre-Closing Period shall be determined level of such items on the basis of an interim closing of the books as of and including the First Closing date in accordance with the next two sentences. For purposes of this Section 6.13(a)(iii)(B)Date; PROVIDED, the portion of the Tax allocable to the Pre-Closing Period shall be the product of HOWEVER, that (x) if any property, asset or other right of a Beverage Company is sold or otherwise transferred prior to the Closing Date, then any such Tax for computed by reference to such property, asset or other right shall be attributed entirely to the entire taxable pre-Closing period, multiplied by and (y) if any property, asset or other right of a fractionBeverage Company is purchased or otherwise acquired after the Closing Date, then any such Tax computed by reference to such property, asset or other right shall be attributed entirely to the numerator of which is the hypothetical Tax for such Pre- Closing Period (determined on the basis of such interim closing of the books, without annualization) and the denominator of which is the sum of the numerator plus the hypothetical Tax for the Postpost-Closing Period (determined on the basis of such interim closing of the books, without annualization). The hypothetical Tax for any period shall in no case be less than zero. The amount of the Tax remaining after subtracting the portion attributable to the Pre-Closing Period (as determined in accordance with the preceding provisions of this Section 6.13(a)(iii)(B)) is the amount of the Tax attributable to the Post-Closing Periodperiod.