Common use of Treatment of Adjustments Clause in Contracts

Treatment of Adjustments. (a) If any adjustment is made in a Return relating to Federal Taxes or Combined State Taxes of the Holdings Consolidated Group, after the filing thereof, in which income or loss of any member of the RJRN Tax Group is included, then within 30 days of the time of a Final Determination of such adjustment, the Designated RJRN Affiliate shall pay to Holdings, or Holdings shall pay to the Designated RJRN Affiliate, as the case may be and as appropriate, (i) the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by the Designated RJRN Affiliate (or treated as such) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that would have been made by the Designated RJRN Affiliate (or treated as such) in accordance with the principles of this Article 3 for the taxable year covered by such Return taking such adjustment into account, and (ii) related adjustments to penalties and interest. Without limiting the generality of Section 3.09(a)(ii) or 3.09(b)(ii), the determination of penalties and interest generally shall take into account the timing and magnitude of the relevant payments, refunds or recoupments made. (b) If any adjustment is made in a Return relating to Federal Taxes or Combined State Taxes of the Holdings Consolidated Group, after the filing thereof, in which income or loss of any member of the Nabisco Tax Group is included, then within 30 days of the time of a Final Determination of such adjustment, Nabisco shall pay to Holdings, or Holdings shall pay to Nabisco, as the case may be and as appropriate, (i) the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by Nabisco (or treated as such) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that would have been made by Nabisco (or treated as such) in accordance with the principles under Article 3 for the taxable year covered by such Return taking such adjustment into account, and (ii) related adjustments to penalties and interest. (c) Any refunds or credits of tax received or otherwise Effectively Realized by Holdings, a member of the Nabisco Tax Group or a member of the RJRN Tax Group, as the case may be, relating to a taxable year that includes a Pre-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax attribute of (i) any member of the Nabisco Tax Group or of the RJRN Tax Group, in the case of Holdings, shall be paid to Nabisco or the Designated RJRN Affiliate, respectively, (ii) Holdings or any member of the RJRN Tax Group, in the case of a member of the Nabisco Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to the Designated RJRN Affiliate), or (iii) Holdings or any member of the Nabisco Tax Group, in the case of a member of the RJRN Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to Nabisco), in each case within 30 days of Effective Realization of such tax saving. In addition, any refunds or credits of tax received or Effectively Realized by Holdings or a member of the Nabisco Tax Group, as the case may be, relating to a taxable year that includes a Post-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax attribute of any member of the Nabisco Tax Group or Holdings, respectively, shall be paid to Nabisco or Holdings, respectively, within 30 days of Effective Realization of such tax saving. Notwithstanding anything in this Section 3.09(c) to the contrary, no payment shall be required to the extent such refunds or credits are attributable to a Tax Asset or an adjustment for which the corporation that receives or otherwise Effectively Realizes the refund or credit has previously made payment in accordance with the principles of this Agreement. (d) For purposes of this Agreement, any income, loss, credit, deduction or other tax attribute of, any tax liability, refund or credit of tax or interest of, or any payments by or on behalf of, any member of the Holdings Consolidated Group (including, without limitation, Holdings or a member of the Nabisco Tax Group) with respect to a Pre-1990 Period shall be treated as an item of the RJRN Tax Group. If, with respect to any Pre-1990 Period, Holdings or any member of the Nabisco Tax Group Effectively Realizes the benefit of a refund of any statutory interest or any Federal Tax or State Tax, Holdings or Nabisco, respectively, shall promptly remit to the Designated RJRN Affiliate the amount of such refund (net of any taxes on the taxable portion, if any, of such refund for which Holdings or the Nabisco Tax Group, respectively, is liable), together with any interest received thereon.

Treatment of Adjustments. (ai) If Except as provided in clause (iii) below if any adjustment is made in in, or if a Taxing Authority assesses any deficiency with respect to, a Return relating to Federal Taxes or Combined State Taxes of the Holdings a Consolidated Group, after the filing thereof, in which income or loss of any Group filed by a member of the RJRN TRICON Group which would have increased the PepsiCo Tax Group is includedLiability under Section 3(c)(i), then within 30 days of the time of after a Final Determination of such the adjustment, the Designated RJRN Affiliate shall pay to Holdings, or Holdings PepsiCo Group shall pay to the Designated RJRN Affiliate, as the case may be and as appropriate, (i) TRICON Group the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by the Designated RJRN Affiliate (or treated as suchmade under Section 3(c)(i) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that would have been made by the Designated RJRN Affiliate (or treated as suchunder Section 3(c)(i) in accordance with the principles of this Article 3 for the taxable year covered by such Return taking such adjustment into account, and (ii) related adjustments to penalties and interest. Without limiting the generality of Section 3.09(a)(ii) or 3.09(b)(ii), the determination of penalties and interest generally shall take into account the timing and magnitude of the relevant payments, refunds or recoupments made. (bii) If any adjustment is made in in, or if a Taxing Authority assesses any deficiency with respect to, a Return relating to Federal Taxes or Combined State Taxes of the Holdings a Consolidated Group, after the filing thereof, in which income or loss of any Group filed by a member of the Nabisco PepsiCo Group which would have increased the TRICON Tax Group is includedLiability under Section 3(c)(i), then within 30 days after any member of the time PepsiCo Group makes a payment to a Taxing Authority or makes a deposit with a Taxing Authority to stop the running of a Final Determination of interest with respect to such adjustment, Nabisco the TRICON Group shall pay to Holdings, or Holdings shall pay to Nabisco, as the case may be and as appropriate, (i) PepsiCo Group the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by Nabisco (or treated as suchmade under Section 3(c)(i) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that would have been made by Nabisco (or treated as suchunder Section 3(c)(i) in accordance with the principles under Article 3 for the taxable year covered by such Return taking such adjustment into account, and (ii) related adjustments to penalties and interest. (ciii) If any adjustment made in, or any deficiency assessed with respect to, a Return of a Consolidated Group results in a reduction in the amount of the benefit realized by the PepsiCo Group from a Tax Asset of the TRICON Group (whether or not the TRICON Group was paid in respect of such benefit), the TRICON Group shall, within 30 days after receipt of written notice from the PepsiCo Group, pay to the PepsiCo Group the amount of such reduction. In addition, the TRICON Group shall hold each member of the PepsiCo Group harmless for any penalty or interest payable by any member of the TRICON Group as a result of any such reduction. (iv) Any refunds or credits of tax Tax (including a return of a deposit described in Section 3(e)(ii)) received or otherwise Effectively Realized by Holdings, a member of the Nabisco Tax TRICON Group or a member of the RJRN Tax Group, as the case may be, relating to a taxable year that includes a Pre-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax attribute of (i) any shall be paid by such member of the Nabisco Tax TRICON Group or of the RJRN Tax Group, in the case of Holdings, shall be paid to Nabisco or the Designated RJRN Affiliate, respectively, (ii) Holdings or any member of the RJRN Tax Group, in the case of a member of the Nabisco Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to the Designated RJRN Affiliate), or (iii) Holdings or any member of the Nabisco Tax Group, in the case of a member of the RJRN Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to Nabisco), in each case PepsiCo Group within 30 days of Effective Realization of receipt; provided that no such tax saving. In addition, any refunds or credits of tax received or Effectively Realized by Holdings or a member of the Nabisco Tax Group, as the case may be, relating to a taxable year that includes a Post-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax attribute of any member of the Nabisco Tax Group or Holdings, respectively, shall be paid to Nabisco or Holdings, respectively, within 30 days of Effective Realization of such tax saving. Notwithstanding anything in this Section 3.09(c) to the contrary, no payment shall be required to the extent such refunds refund or credits are credit is attributable to (x) a Tax Asset of the PepsiCo Group for which payment has previously been made by the TRICON Group, or (y) an adjustment for which the corporation that receives or otherwise Effectively Realizes the refund or credit payment in respect thereof has previously been made payment in accordance with the principles of this Agreementpursuant to Section 3(e)(i) or 3(e)(ii). (d) For purposes of this Agreement, any income, loss, credit, deduction or other tax attribute of, any tax liability, refund or credit of tax or interest of, or any payments by or on behalf of, any member of the Holdings Consolidated Group (including, without limitation, Holdings or a member of the Nabisco Tax Group) with respect to a Pre-1990 Period shall be treated as an item of the RJRN Tax Group. If, with respect to any Pre-1990 Period, Holdings or any member of the Nabisco Tax Group Effectively Realizes the benefit of a refund of any statutory interest or any Federal Tax or State Tax, Holdings or Nabisco, respectively, shall promptly remit to the Designated RJRN Affiliate the amount of such refund (net of any taxes on the taxable portion, if any, of such refund for which Holdings or the Nabisco Tax Group, respectively, is liable), together with any interest received thereon.

Treatment of Adjustments. (a) If any adjustment of an item of tax is made in a Return relating to Federal Taxes or Combined State Taxes of the Holdings Consolidated Group, after the filing thereof, in which income or loss of any member of the RJRN Tax Group is included, then within 30 days of the time of a Final Determination of such adjustment, the Designated RJRN Affiliate shall pay to Holdings, or Holdings shall pay to the Designated RJRN Affiliate, as the case may be and as appropriatebe, (i) the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by the Designated RJRN Affiliate (or treated as such) in accordance with the principles of Article 3 with respect to such tax item for the taxable year covered by such Return, and (B) all payments that would have been made by the Designated RJRN Affiliate (or treated as such) in accordance with the principles of this Article 3 with respect to such tax item for the taxable year covered by such Return taking such adjustment into account. (b) Upon the Final Determination of an adjustment of an item of tax under Section 3.09(a), the Designated RJRN Affiliate shall pay to Holdings, or Holdings shall pay to the Designated RJRN Affiliate, as the case may be, the difference between (A) all interest and penalty payments actually made, net of refunds or recoupments of interest and penalties received or otherwise Effectively Realized, by the Designated RJRN Affiliate (or treated as such) with respect to such tax item, and (iiB) related adjustments all interest and penalty payments that would have been made by the Designated RJRN Affiliate with respect to penalties and interest. Without limiting the generality of Section 3.09(a)(ii) or 3.09(b)(ii), the determination of penalties and interest generally shall take into account such tax item (with regard to the timing and magnitude of each payment, refund or recoupment actually made, received or Effectively Realized with respect to the relevant payments, refunds tax item to which the interest or recoupments madepenalty relates) taking such adjustment into account. (bc) If any adjustment of an item of tax is made in a Return relating to Federal Taxes or Combined State Taxes of the Holdings Consolidated Group, after the filing thereof, in which income or loss of any member of the Nabisco Tax Group is included, then within 30 days of the time of a Final Determination of such adjustment, Nabisco shall pay to Holdings, or Holdings shall pay to Nabisco, as the case may be and as appropriatebe, (i) the difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by Nabisco (or treated as such) in accordance with the principles of Article 3 with respect to such tax item for the taxable year covered by such Return, and (B) all payments that would have been made by Nabisco (or treated as such) in accordance with the principles under Article 3 with respect to such tax item for the taxable year covered by such Return taking such adjustment into account. (d) Upon the Final Determination of an adjustment of an item of tax under Section 3.09(c), Nabisco shall pay to Holdings, or Holdings shall pay to Nabisco, as the case may be, the difference between (A) all interest and penalty payments actually made, net of refunds or recoupments of interest and penalties received or otherwise Effectively Realized, by Nabisco (or treated as such) with respect to such tax item, and (iiB) related adjustments all interest and penalty payments that would have been made by Nabisco with respect to penalties such tax item (with regard to the timing and interestmagnitude of each payment, refund or recoupment actually made, received or Effectively Realized with respect to the tax item to which the interest or penalty relates) taking such adjustment into account. (ce) Any refunds or credits of tax received or otherwise Effectively Realized by Holdings, a member of the Nabisco Tax Group or a member of the RJRN Tax Group, as the case may be, relating to a taxable year that includes a Pre-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, extent (a) by the corporation receiving the refund or credit, deduction or other tax attribute of (i) any member of the Nabisco Tax Group or of the RJRN Tax Group, in the case of Holdings, shall be paid to Nabisco or the Designated RJRN Affiliate, respectively, (ii) Holdings or any member of the RJRN Tax Group, in the case of a member of the Nabisco Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to the Designated RJRN Affiliate), or (iii) Holdings or any member of the Nabisco Tax Group, in the case of a member of the RJRN Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to Nabisco), in each case within 30 days of Effective Realization of such tax saving. In addition, any refunds or credits of tax received or Effectively Realized by Holdings or a member of the Nabisco Tax Group, as the case may be, relating to a taxable year that includes a Post-Distribution Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax attribute of any member of the Nabisco Tax Group or Holdings, respectively, shall be paid to Nabisco or Holdings, respectively, within 30 days of Effective Realization of such tax saving. Notwithstanding anything in this Section 3.09(c) to the contrary, no payment shall be required to the extent such refunds or credits are attributable to a Tax Asset or an adjustment for which the corporation that receives or otherwise Effectively Realizes the refund or credit payment in respect thereof has previously been made payment in accordance with the principles of this AgreementSection 3.09(a) or 3.09(c). (df) For purposes of the calculations under this AgreementSection 3.09, any income, loss, credit, deduction or other tax attribute of, any tax liability, refund or credit of tax or interest of, or any payments by or on behalf of, any member of the Holdings Consolidated Group (including, without limitation, Holdings or a member of the Nabisco Tax Group) with respect to a Pre-1990 Pre-January 1990 Period shall be treated as an item of the RJRN Tax Group. If, with respect to any Pre-1990 Pre-January 1990 Period, Holdings or any member of the Nabisco Tax Group Effectively Realizes the benefit of a refund of any statutory interest or any Federal Tax or Combined State Tax, Holdings or Nabisco, respectively, shall promptly remit to the Designated RJRN Affiliate the amount of such refund (net of any taxes on the taxable portion, if any, of such refund for which Holdings or the Nabisco Tax Group, respectively, is liable)refund, together with any interest received thereon.

Treatment of Adjustments. (ai) Except as provided in clause (iii) below, if any adjustment is made in, or if a Taxing Authority assesses any deficiency with respect to, a Return of a Consolidated Group filed by a member of the PBG Group which would have increased the PepsiCo Tax Liability under Section 3(c)(i), then within 30 days after a Final Determination of the adjustment, the PepsiCo Group shall pay to the PBG Group the difference between all payments actually made under Section 3(c)(i) and all payments that wou have been made under Section 3(c)(i) taking such adjustment into account. (ii) If any adjustment is made in in, or if a Taxing Authority assesses any deficiency with respect to, a Return relating to Federal Taxes or Combined State Taxes of the Holdings a Consolidated Group, after the filing thereof, in which income or loss of any Group filed by a member of the RJRN PepsiCo Group which would have increased the PBG Tax Group is includedLiability under Section 3(c)(i), then within 30 days after any member of the time PepsiCo Group makes a payment to a Taxing Authority or makes a deposit with a Taxing Authority to stop the running of a Final Determination of interest with respect to such adjustment, the Designated RJRN Affiliate shall pay to Holdings, or Holdings PBG Group shall pay to the Designated RJRN Affiliate, as the case may be and as appropriate, (i) the PepsiCo Group t difference between (A) all payments actually made, net of all refunds or recoupments received or otherwise Effectively Realized, by the Designated RJRN Affiliate (or treated as suchmade under Section 3(c)(i) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that would have been made by the Designated RJRN Affiliate (or treated as suchunder Section 3(c)(i) in accordance with the principles of this Article 3 for the taxable year covered by such Return taking such adjustment into account, and (ii) related adjustments to penalties and interest. Without limiting the generality of Section 3.09(a)(ii) or 3.09(b)(ii), the determination of penalties and interest generally shall take into account the timing and magnitude of the relevant payments, refunds or recoupments made. (biii) If any adjustment is made in a Return relating If, subsequent to Federal Taxes the payment by the PepsiCo Group or Combined State Taxes of the Holdings Consolidated PBG Group, after the filing thereof, in which income or loss of any member of the Nabisco Tax Group is included, then within 30 days of the time of a Final Determination of such adjustment, Nabisco shall pay to Holdings, or Holdings shall pay to Nabisco, as the case may be and as appropriate(the "Payor Group"), to the PBG Group or the PepsiCo Group, respectively (ithe "Payee Group"), of any amount referred to in Section 3(c)(ii), 3(c)(iii) the difference between or 3(d)(i) above, there shall be (A) all payments actually made, net a Final Determination which results in a disallowance or a reduction of all refunds the relevant Tax Asset or recoupments received or otherwise Effectively Realized, by Nabisco (or treated as such) in accordance with the principles of Article 3 for the taxable year covered by such Return, and (B) all payments that a reduction in the amount of the benefit realized by the Payor Group from such Tax Asset as the result of a Fin Determination or the use by the Payor Group of a Tax Asset of a member of the Payor Group, the Payee Group shall repay to the Payor Group the amount which would not have been made payable to the Payee Group pursuant to Section 3(c)(ii), 3(c)(iii) or 3(d)(i) had the amount of the benefit been determined in light of such event. In addition, the Payee Group shall hold each member of the Payor Group harmless for any penalty or interest payable by Nabisco (or treated any member of the Payor Group as sucha result of any such event referred to in the preceding sentence. Any amounts payable under this Section 3(e)(iii) in accordance with shall be paid by the principles under Article 3 for Payee Group within 30 days of demand therefor. To the taxable year covered extent the Payee Group's repayment obligation arises due to the use by the Payor Group of a Tax Asset of a member of the Payor Group, the Payee Group shall pay to the Payor Group interest on the amount repaid to the Payor Group from the date such Return taking amount was paid by the Payor Group until such adjustment into account, and (ii) related adjustments to penalties and interestrepayment at Prime. (civ) Any refunds or credits of tax Tax (including a return of a deposit described in Section 3(e)(ii)) received or otherwise Effectively Realized by Holdings, a member of the Nabisco Tax PepsiCo Group or a member of the RJRN Tax PBG Group, as the case may be, relating to a taxable year that includes a Pre-Distribution Offering Period, to the extent reflecting a tax saving attributable to any item of income, loss, credit, deduction or other tax Tax attribute of (i) any member of the Nabisco Tax PBG Group or of the RJRN Tax PepsiCo Group, in the case of Holdingsrespectively, shall be paid to Nabisco by the PepsiCo Group or the Designated RJRN AffiliatePBG Group, respectively, to the PBG Group or the PepsiCo Group, respectivel within 30 days of receipt; provided that no such payment shall be required to the extent such refund or credit is attributable to (iix) Holdings or any member a Tax Asset of the RJRN Tax PBG Group or PepsiCo Group, in respectively, for which payment has previously been made by the case of a member of PepsiCo Group or the Nabisco Tax PBG Group, shall be paid respectively, pursuant to Holdings (and, as appropriate, forwarded by Holdings to the Designated RJRN AffiliateSection 3(c) or 3(d)(i), or (iiiy) Holdings an adjustment for which payment in respect thereof has previously been made pursuant to Section 3(e)(i), 3(e)(ii) or any member of the Nabisco Tax Group3(e)(iii); and PROVIDED FURTHER that, in the case of a member of the RJRN Tax Group, shall be paid to Holdings (and, as appropriate, forwarded by Holdings to Nabisco), in each case within 30 days of Effective Realization of such tax saving. In addition, any refunds or credits of tax received or Effectively Realized by Holdings or a member of the Nabisco Tax Group, as the case may be, relating to a taxable year that includes a Post-Distribution Period, to determining the extent reflecting to which a tax saving refund is attributable to any item of income, loss, credit, deduction or other tax Tax attribute of any member of the Nabisco Tax Group or Holdings, respectively, shall be paid to Nabisco or Holdings, respectively, within 30 days of Effective Realization of such tax saving. Notwithstanding anything in this Section 3.09(c) to the contrary, no payment shall be required to the extent such refunds or credits are attributable to a Tax Asset or an adjustment for which the corporation that receives or otherwise Effectively Realizes the refund or credit has previously made payment in accordance with the principles of this Agreement. (d) For purposes of this Agreement, any income, loss, credit, deduction or other tax attribute of, any tax liability, refund or credit of tax or interest of, or any payments by or on behalf of, any member of the Holdings Consolidated Group (including, without limitation, Holdings or a member of the Nabisco Tax PepsiCo Group or the PBG Group) , if the portion of any such refund represents interest with respect to a Pre-1990 Period Taxes and the items or Tax attributes to which such interest relates are not readily identifiable, then the PepsiCo Senior Vice President and Treasurer shall be treated as an item in good faith determine the allocation such interest among the items and Tax attributes of the RJRN Tax Group. If, with respect to any Pre-1990 Period, Holdings or any member members of the Nabisco Tax PepsiCo Group Effectively Realizes and the benefit of a refund of any statutory interest or any Federal Tax or State Tax, Holdings or Nabisco, respectively, shall promptly remit to the Designated RJRN Affiliate the amount of such refund (net of any taxes on the taxable portion, if any, of such refund for which Holdings or the Nabisco Tax PBG Group, respectively, is liable), together with any interest received thereon.