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Exhibit 10.2
TAX ALLOCATION AGREEMENT
This TAX ALLOCATION AGREEMENT is dated as of June [ ], 1998, between
THE DUN & BRADSTREET CORPORATION, a Delaware corporation (the "Corporation") and
THE NEW DUN & BRADSTREET CORPORATION, a Delaware corporation ("New D&B")
(collectively, the "Parties").
WHEREAS, as of the date hereof, the Corporation is the common parent
of an affiliated group of domestic corporations within the meaning of Section
1504(a) of the Code, including Dun & Bradstreet, Inc. ("D&B Opco Inc."), Dun &
Bradstreet International, Ltd. ("D&B International"), Xxxxx'x Investors Service,
Inc. ("Moody's"), The Xxxxxx X. Xxxxxxxxx Corporation ("RHD"), and others, and
the members of the affiliated group have heretofore joined in filing
consolidated federal income tax returns;
WHEREAS, the Board of Directors of the Corporation has determined
that it is appropriate, desirable and in the best interests of the holders of
shares of common stock, par value $1.00 per share, of the Corporation (the "D&B
Common Stock") to take certain steps to reorganize the Corporation's
Subsidiaries (as defined herein) and businesses and to distribute to the holders
of D&B Common Stock all the outstanding shares of common stock of New D&B (the
"New D&B Common Shares"), together with associated Rights;
WHEREAS, as a result of the Reorganization (as defined herein) and
Distribution (as defined herein), New D&B, D&B Opco Inc., D&B International,
Moody's, and others, will not be included in the consolidated federal income tax
return of the Corporation for the portion of the year following the Distribution
or in future years;
WHEREAS, the Parties desire to allocate the tax burdens and benefits
of transactions which occurred on or prior to the Distribution Date and to
provide for certain other tax matters, including the assignment of
responsibility for the preparation and filing of tax returns, the payment of
taxes, and the prosecution and defense of any tax controversies;
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained in this Agreement, the Parties hereby agree
as follows:
ARTICLE I. DEFINITIONS
SECTION 1.1. General. Capitalized terms used in this Agreement and
not defined herein shall have the meanings that such terms have in the
Distribution Agreement. As used in this Agreement, the following terms shall
have the following meanings:
(a) "Agreement" shall mean this Tax Allocation Agreement.
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(b) "Ancillary Agreements" shall mean all of the written agreements,
instruments, assignments or other arrangements (other than this Agreement)
entered into in connection with the transactions contemplated hereby, including,
without limitation, the Distribution Agreement, the Conveyancing and Assumption
Instruments, the Employee Benefits Agreement, the Shared Transaction Services
Agreement, the Transition Services Agreement, the Data Services Agreement and
the Intellectual Property Agreement.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended,
and the Treasury regulations promulgated thereunder, including any successor
legislation.
(d) "Consolidated Return" shall mean the consolidated federal income
tax return of the Corporation for the period commencing on January 1, 1998, and
including the members of the New D&B Group through the Distribution Date.
(e) "Controlled Entity" shall mean any corporation, partnership or
other entity of which another entity (i) owns, directly or indirectly, ownership
interests sufficient to elect a majority of the Board of Directors (or persons
performing similar functions) (irrespective of whether at the time any other
class or classes of ownership interests of such corporation, partnership or
other entity shall or might have such voting power upon the occurrence of any
contingency) or (ii) is a general partner or an entity performing similar
functions (e.g., a trustee).
(f) "Deferred Compensation Deduction" shall mean a deduction with
respect to deferred compensation payments and/or the exercise of stock options
in the Corporation by any former employee of the Pre-Distribution D&B Group if
such deduction is disallowed for a member of the New D&B Group and may be
claimed by any member of the RHD Group.
(g) "Distribution" shall mean the distribution on the Distribution
Date to holders of record of shares of D&B Common Stock as of the Distribution
Record Date of the New D&B Common Shares owned by the Corporation on the basis
of one New D&B Common Share for each outstanding share of D&B Common Stock.
(h) "Distribution Agreement" shall mean the agreement between the
Corporation and New D&B, dated as of June [ ], 1998, to, among other things,
allocate certain assets and allocate and assign responsibility for certain
liabilities of the Corporation and its current and former Subsidiaries.
(i) "Distribution Date" shall mean June 30, 1998.
(j) "Distribution Record Date" shall mean such date as may be
determined by the Corporation's Board of Directors as the record date for the
Distribution.
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(k) "Final Determination" shall mean the final resolution of
liability for any Tax for any taxable period, including any related interest or
penalties, by or as a result of: (i) a final and unappealable decision,
judgment, decree or other order by any court of competent jurisdiction; (ii) a
closing agreement or accepted offer in compromise under Section 7121 or 7122 of
the Code, or comparable agreement under the laws of other jurisdictions which
resolves the entire Tax liability for any taxable period; (iii) any allowance of
a refund or credit in respect of an overpayment of Tax, but only after the
expiration of all periods during which such refund may be recovered by the
jurisdiction imposing the Tax; or (iv) any other final disposition, including by
reason of the expiration of the applicable statute of limitations.
(l) "Governmental Authority" shall mean any federal, state, local,
foreign or international court, government, department, commission, board,
bureau, agency, official or other regulatory, administrative or governmental
authority.
(m) "Income Tax Return" shall mean any Tax Return relating to Income
Taxes.
(n) "Income Taxes" shall mean any federal, state or local Taxes
determined by reference to income, net worth, gross receipts or capital or any
federal, state or local Taxes imposed in lieu of income Taxes.
(o) "Indemnifying Party" shall have the meaning as defined in
Section 3.5.
(p) "Indemnitee" shall have the meaning as defined in Section 3.5.
(q) "IRS" shall mean the Internal Revenue Service.
(r) "New D&B Group" shall mean New D&B, New D&B Opco Inc., D&B
International, Moody's and each corporation, partnership, limited liability
company, or other entity (other than any member of the RHD Group) that is a
Subsidiary of the Corporation immediately prior to the Distribution.
(s) "New D&B Opco Inc." shall mean a newly formed Delaware
corporation and wholly owned subsidiary of New D&B created to hold the assets
and liabilities related to, and to operate, the business of supplying business,
commercial-credit and business-marketing information services and receivables
management services.
(t) "Nonperforming Party" shall have the meaning as defined in
Section 5.2.
(u) "Other Taxes" shall mean any federal, state or local Taxes other
than Income Taxes.
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(v) "Person" shall mean any natural person, corporation, business
trust, joint venture, association, company, partnership or government, or any
agency or political subdivision thereof.
(w) "Pre-Distribution D&B Group" shall mean the Corporation and all
of its Subsidiaries (direct and indirect, domestic and foreign) at any time
prior to the Distribution.
(x) "Reorganization" shall mean the series of contributions and
distributions of Controlled Entities and assets, transfers and assumptions of
liabilities, and other transactions whereby the New D&B Group and the RHD Group
are formed and all Controlled Entities of the Corporation prior to the
Distribution (other than New D&B and the other members of the RHD Group) are
placed under the control of New D&B in preparation for the Distribution.
(y) "Reorganization Tax Payment" shall mean the payment of any Tax
for which New D&B is liable pursuant to Section 3.3 of this Agreement and the
imposition and/or payment of which will permit the other Party or any of its
Subsidiaries to increase deductions, losses or Tax credits or decrease income,
gains or recapture of Tax credits for any taxable period or periods beginning
after or including but not ending on the Distribution Date.
(z) "RHD Group" shall mean the Corporation, RHD and each
corporation, partnership, limited liability company or other entity contemplated
to remain or become a Subsidiary of the Corporation after the Distribution.
(aa) "Separate Company State or Local Income Tax Return" shall mean
any state or local Income Tax Return initially filed on a separate basis
(whether or not it is subsequently determined that such Income Tax Return should
have been filed on a combined basis).
(ab) "Subsidiary" shall mean any entity of which another entity's
ownership satisfies the 80-percent voting and value test defined in Section
1504(a)(2) of the Code, whether directly or indirectly.
(ac) "Tax" or "Taxes" whether used in the form of a noun or
adjective, shall mean taxes on or measured by income, capital, net worth,
franchise, gross receipts, sales, use, excise, payroll, personal property, real
property, ad-valorem, value-added, leasing, leasing use or other taxes, levies,
imposts, duties, charges or withholdings of any nature. Whenever the term "Tax"
or "Taxes" is used (including, without limitation, regarding any duty to
reimburse another Party for indemnified taxes or refunds or credits of taxes) it
shall include penalties, fines, additions to tax and interest thereon.
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(ad) "Tax Benefit" shall mean the sum of the amount by which the Tax
liability (after giving effect to any alternative minimum or similar Tax) of a
corporation or group of affiliated corporations to an applicable taxing
authority is reduced (including, without limitation, by deduction, entitlement
to refund, credit or otherwise, whether available in the current taxable year,
as an adjustment to taxable income in any other taxable year or as a
carryforward or carryback, as applicable) plus any interest from such government
or jurisdiction relating to such Tax liability.
(ae) "Tax Detriment" shall mean the sum of the amount by which the
Tax liability (after giving effect to any alternative minimum or similar Tax) of
a corporation or group of affiliated corporations to an applicable taxing
authority is increased plus any interest or penalties due to such government or
jurisdiction relating to such Tax liability.
(af) "Tax Item" shall mean any item of income, capital gain, net
operating loss, capital loss, deduction, credit or other Tax attribute relevant
to the calculation of a Tax liability.
(ag) "Tax Returns" shall mean all reports or returns (including
information returns) required to be filed or that may be filed for any period
with any taxing authority (whether domestic or foreign) in connection with any
Tax or Taxes (whether domestic or foreign).
(ah) "Timing Adjustment" shall mean any adjustment which (x)
decreases deductions, losses or credits or increases income (including any
increases in income where no income was previously reported), gains or recapture
of Tax credits for the period in question, and for which either Party is
liable pursuant to this Agreement, and (y) will permit an increase in
deductions, losses or Tax credits or a decrease in income, gains or recapture of
Tax credits for another taxable period, and with respect to which the other
Party benefits.
SECTION 1.2. References; Interpretation. References in this
Agreement to any gender include references to all genders, and references to the
singular include references to the plural and vice versa. The words "include",
"includes" and "including" when used in this Agreement shall be deemed to be
followed by the phrase "without limitation". Unless the context otherwise
requires, references in this Agreement to Articles, Sections, Exhibits and
Schedules shall be deemed references to Articles and Sections of, and Exhibits
and Schedules to, such Agreement. Unless the context otherwise requires, the
words "hereof", "hereby" and "herein" and words of similar meaning when used in
this Agreement refer to this Agreement in its entirety and not to any particular
Article, Section or provision of this Agreement.
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ARTICLE II. PREPARATION AND FILING OF TAX RETURNS
SECTION 2.1. Predistribution Tax Returns.
(a) All federal Income Tax Returns of the Pre-Distribution D&B Group
that are required to be filed for periods beginning before the Distribution Date
shall be prepared by New D&B and filed by the Corporation.
(b) All combined state and local Income Tax Returns of the
Pre-Distribution D&B Group that may be or are required to be filed for periods
beginning before the Distribution Date shall be prepared by New D&B and filed by
the Corporation.
(c) In the case of Tax Returns for foreign, non-combined state and
local Income Taxes and Other Taxes of any member of the Pre-Distribution D&B
Group that may be or are required to be filed for any period beginning before
the Distribution Date, New D&B shall prepare and file such Tax Returns (or shall
cause such Tax Returns to be prepared and filed) if they relate to a member of
the New D&B Group and the Corporation shall prepare and file such Tax Returns
(or shall cause such Tax Returns to be prepared and filed) if they relate to a
member of the RHD Group.
(d) In the case of any partnership in which a member of the
Pre-Distribution D&B Group is the designated tax matters partner, the
Corporation or New D&B, as the case may be, shall cause such entity to prepare
and file such partnership's Tax Returns for all periods beginning prior to the
Distribution Date.
SECTION 2.2. Post-Distribution Tax Returns.
(a) The filing of all Tax Returns for periods beginning on or after
the Distribution Date shall be the responsibility of the Corporation if they
relate to any member of the RHD Group and shall be the responsibility of New D&B
if they relate to any member of the New D&B Group.
(b) In the case of any partnership in which a member of the
Pre-Distribution D&B Group is the designated tax matters partner, the
Corporation or New D&B, as the case may be, shall cause such entity to continue
to prepare and file such partnership's Tax Returns.
SECTION 2.3. Manner of Preparation.
(a) Unless otherwise required by the IRS, any Governmental Authority
or a court, the Parties hereby agree to file all Tax Returns, and to take all
other actions, in a manner consistent with the position that the last day on
which any member of the New D&B Group was included in the Pre-Distribution D&B
Group is the Distribution Date. For any period that includes but does not end on
the Distribution Date, to the extent
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permitted by law or administrative practice, the taxable year of each member of
the Pre-Distribution D&B Group and any group of such members shall be treated as
ending on the Distribution Date.
(b) In the case of federal Income Tax Returns and combined state
and local Income Tax Returns, the Corporation shall prepare, in a manner
consistent with prior practice, a tax package for each member of the RHD Group
included in the relevant Tax Return and shall provide such tax package to New
D&B at least 90 days prior to the due date (including extensions) of the Tax
Return. New D&B shall submit any part of the Tax Return that relates to a member
of the RHD Group to the Corporation at least 30 days prior to the date on which
such Tax Return is due (including extensions). The Corporation shall submit its
comments to New D&B within 10 days of receipt of the relevant portions of such
Tax Return. New D&B shall not be required to alter the Tax Return to reflect
such comments unless the Corporation receives an opinion of tax counsel, which
counsel shall be reasonably acceptable to New D&B, to the effect that failure to
make such alteration would create a significant risk of the imposition of a
penalty on the Corporation or any other member of the RHD Group.
(c) With regard to Tax Returns to be prepared and filed by the
Corporation or any other member of the RHD Group with respect to which New D&B
has liability under section 3.1 hereof, the Corporation shall submit such
Tax Return to New D&B at least 30 days prior to the date on which such Tax
Return is due (including extensions). New D&B shall submit its comments to the
Corporation within 10 days of receipt of such Tax Return. The Corporation
shall alter the Tax Return to reflect the comments of New D&B unless the
Corporation receives an opinion of tax counsel, which counsel shall be
reasonably acceptable to New D&B, to the effect that such alteration would
create a significant risk of the imposition of a penalty on the Corporation or
any other member of the RHD Group.
(d) All Tax Returns filed on or after the Distribution Date shall be
prepared on a basis that is consistent with the rulings obtained from the IRS or
any other Governmental Authority in connection with the Reorganizations or
Distribution (in the absence of a controlling change in law or circumstances)
and shall be filed on a timely basis (including pursuant to extensions) by the
Party responsible for such filing under this Agreement. In the absence of a
controlling change in law or circumstances and unless deviation from past
practice would have no adverse effect on either Party, all Tax Returns filed
after the date of this Agreement shall be prepared on a basis consistent with
the elections, accounting methods, conventions, assumptions and principles of
taxation used for the most recent taxable periods for which Tax Returns
involving similar Tax Items have been filed. In the event of a deviation from
such past practices by the Corporation, the Corporation shall not be in breach
of this agreement, but, notwithstanding Article III, New
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D&B shall have no liability for any Taxes resulting from such deviation and the
Corporation shall hold New D&B harmless from any such increased tax liability;
provided, however, either Party filing any Tax Return that does not conform
to such past practices shall not be liable for any additional Tax liability
imposed (subject to Section 3.1), in whole or in part, as a result of such
deviation from past practice if: (i) for Tax Returns filed within three years of
the Distribution Date, 30 days prior to the filing of such Tax Return, the Party
filing such Tax Return notifies the other Party; and (ii) the Party filing such
Tax Return establishes that conformity with past practice involves a significant
risk of the imposition of a penalty.
ARTICLE III. PAYMENT OF TAXES
SECTION 3.1. Predistribution Taxes.
(a) New D&B shall be liable for and shall pay all federal, state,
local and foreign Income Taxes (or receive all refunds) for all members of the
Pre-Distribution D&B Group for all periods ending on or prior to the
Distribution Date, including Taxes arising as a result of an audit adjustment;
provided, however, that in the case of any Separate Company State or Local
Income Tax Return, the RHD Group and the New D&B Group shall be liable for and
shall pay their own liabilities (or receive their own refunds) arising from any
audit adjustment (including any state or local audit adjustment resulting from a
federal audit adjustment).
(b) The RHD Group and the New D&B Group shall be responsible for
their own Other Taxes for all periods.
(c) Straddle Periods
(i) In the case of any tax period including but ending after
the Distribution Date, New D&B shall be liable for and shall pay all Income
Taxes (or receive all refunds) of all members of the Pre-Distribution D&B Group
attributable to the period up to the Distribution Date (any such Income Taxes,
"Pre-Distribution Income Taxes"). The RHD Group and the New D&B Group shall be
responsible for their own Tax liabilities (or be entitled to their own refunds)
attributable to the portion of the tax period after the Distribution Date. Such
apportionment will be done on a closing of the books basis, except that Tax
Items that are calculated on an annual basis shall be apportioned on a time
basis.
(ii) The amount of Pre-Distribution Income Taxes payable by
New D&B pursuant to Section 3.1(c)(i) above shall be reduced by the amount of
any estimated Income Taxes paid by the Pre-Distribution D&B Group (or any member
thereof) prior to the Distribution Date. If the amount of any such estimated
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Income Tax payments exceeds the amount of Pre-Distribution Income Taxes, RHD
shall pay New D&B the amount of such excess.
SECTION 3.2. Post-Distribution Taxes. Unless otherwise provided in
this Agreement:
(a) New D&B shall pay all Taxes and shall be entitled to receive and
retain all refunds of Taxes with respect to tax periods beginning on or after
the Distribution Date that are attributable to the New D&B Group or any member
thereof; and
(b) The Corporation shall pay all Taxes and shall be entitled to
receive and retain all refunds of Taxes with respect to tax periods beginning on
or after the Distribution Date that are attributable to the RHD Group or any
member thereof.
SECTION 3.3. Restructuring Taxes. Notwithstanding any statement to
the contrary in this Agreement and except as otherwise provided in the
Distribution Agreement, to the extent that any Taxes are found to arise out of
the Reorganization, then any such Tax liability incurred by the Parties (or
any of their Subsidiaries) shall be the responsibility of New D&B; provided,
however, that to the extent specific cash allocations for such Taxes are made in
connection with the Distribution, New D&B shall be relieved of its liability for
such Taxes.
SECTION 3.4. Gain Recognition Agreements. New D&B shall prepare all
documentation required to be filed with any Tax Returns, including required
annual certifications, relating to gain recognition agreements under Section
367(a) of the Code entered into with respect to transactions between members of
the Pre-Distribution D&B Group occurring before the Distribution Date and shall
deliver such documentation to the Corporation. The Corporation shall be
obligated to file such documentation with the appropriate Tax Returns.
SECTION 3.5. Indemnification.
(a) Indemnification by New D&B. New D&B shall indemnify, defend and
hold harmless the Corporation and RHD (and their respective affiliates) from and
against any and all Tax liabilities allocated to New D&B by this Agreement.
(b) Indemnification by the Corporation. The Corporation shall
indemnify, defend and hold harmless New D&B, New D&B, Inc. and Moody's (and
their respective affiliates) from and against any and all Tax liabilities
allocated to the Corporation by this Agreement.
(c) Indemnity Payments.
(i) To the extent that one Party (the "Indemnifying Party") owes
money to another Party (the "Indemnitee") pursuant to this Section 3.5, the
Indemnitee shall provide the Indemnifying Party with its calculations of the
amount required to be paid pursuant to this Section 3.5, showing such
calculations in sufficient detail so as to permit the Indemnifying Party to
understand the calculations. The Indemnifying Party shall pay the Indemnitee, no
later than the later of 30 business days prior to the due date (including
extensions) of the relevant Tax Returns and 14 business days after the
Indemnifying Party receives the Indemnitee's calculations, the amount that the
Indemnifying Party is required to pay or indemnify the Indemnitee under this
Section 3.5 unless
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the Indemnifying Party disagrees with the Indemnitee's calculations (in which
case any dispute regarding such calculations shall be resolved in accordance
with Section 5.4 of this Agreement).
(ii) All indemnity payments shall be calculated on an after-Tax
basis and shall be treated as contributions to capital and/or dividends
immediately prior to the Distribution.
ARTICLE IV. TAX ATTRIBUTES, TIMING ADJUSTMENTS AND REORGANIZATION TAX PAYMENTS
SECTION 4.1. Carrybacks. In the event any net operating loss,
capital loss or credit of the Corporation for any taxable period ending on or
after the Distribution Date is eligible to be carried back to a taxable period
beginning prior to the Distribution Date (any such amount, an "Eligible
Amount"), the Corporation may, to the extent permitted under applicable Tax
law, elect not to carry back such Eligible Amount. To the extent any Eligible
Amount is carried back and used by the Corporation for a taxable period
beginning prior to the Distribution Date, the Corporation shall be obligated to
pay any refund that it receives to New D&B; provided, that in the case of any
taxable period including but ending after the Distribution Date, the
Corporation shall not be obligated to pay any such refund to New D&B to the
extent the refund is attributable to the portion of the taxable period after
the Distribution Date (determined in accordance with the principles of Section
3.1(c)). [Upon request by New D&B, the Corporation shall, within 90 days of
such request, deliver an officer's certificate to New D&B stating whether
or not the Corporation has any Eligible Amount.]
SECTION 4.2. Timing Adjustments, Reorganization Tax Payments, and
Deferred Compensation Deductions.
(a) If an audit or other examination of any federal, state or local
Tax Return (other than a Separate Company State or Local Income Tax Return with
respect to which the RHD Group is liable for audit adjustments pursuant to
Section 3.1(a)) (x) for any period beginning prior to the Distribution Date
shall result (by settlement or otherwise) in a Timing Adjustment in favor of
the RHD Group or any member thereof, or (y) for any taxable period shall result
(by settlement or otherwise) in a Deferred Compensation Deduction in favor of
the RHD Group or any member thereof, or if any Reorganization Tax Payment in
favor of the RHD Group or any member thereof is made by New D&B, then:
(i) The Corporation shall pay New D&B the amount of any Tax
Benefit that results from such Timing Adjustment, Reorganization Tax Payment, or
Deferred Compensation Deduction within 30 business days of the date such Tax
Benefits are realized; and
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(ii) Notwithstanding the foregoing, the Corporation shall only
be required to take steps to obtain such Tax Benefit or to pay New D&B if, in
the opinion of the Corporation's tax counsel, which counsel shall be reasonably
acceptable to New D&B, the reporting of such Tax Benefit shall not expose the
Corporation to the imposition of a penalty.
(b) If an audit or other examination of any federal, state or local
Tax Return for any period beginning prior to the Distribution Date shall result
(by settlement or otherwise) in a Timing Adjustment to the Tax Detriment of the
RHD Group or any member thereof after the Distribution Date, then New D&B shall
pay the Corporation the lesser of (i) the amount of any such Tax Detriment and
(ii) the actual Tax Benefit to New D&B that results from such Timing Adjustment.
(c) Realization of Tax Benefits.
(i) For purposes of this Section 4.3, a Tax Benefit shall be deemed
to have been realized at the time any refund of Taxes is received or applied
against other Taxes due, or at the time of filing of a Tax Return (including any
Tax Return relating to estimated Taxes) on which a loss, deduction or credit is
applied in reduction of Taxes which would otherwise be payable. Where a Party
has other losses, deductions, credits or similar items available to it, such
deductions, credits or similar items of such Party may only be applied after the
use of any Timing Adjustment, Reorganization Tax Payment, or Deferred
Compensation Deduction.
(ii) The Corporation may, at its election, pay the amount of any Tax
Benefit to New D&B rather than filing amended returns or otherwise reflecting
adjustments or taking positions on its Tax Returns. If such an election is made,
the Corporation will be treated as having realized a Tax Benefit at the time it
would have realized a Tax Benefit had it chosen to file amended returns or
otherwise to reflect adjustments or to take positions on its Tax Returns.
(d) Tax Benefits Subsequently Denied. If any Tax Benefit realized
pursuant to Section 4.3(c)(i) is subsequently denied, then the Corporation or
New D&B, as the case may be, shall refund the amount of any payment for such Tax
Benefit within 30 business days of its notification that a Final Determination
has been reached denying the claimed Tax Benefit.
ARTICLE V. TAX AUDITS, TRANSACTIONS AND OTHER MATTERS
SECTION 5.1. Tax Audits and Controversies.
(a) In the case of any audit, examination or other proceeding
("Proceeding") brought against the Corporation (or a Subsidiary) with respect to
Taxes for which New D&B is or may be
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liable pursuant to this Agreement, the Corporation shall promptly inform New D&B
and shall execute or cause to be executed any powers of attorney or other
documents necessary to enable New D&B to take all actions desired with respect
to such Proceeding. Each Party shall have the right to control, at its own
expense, the portion of any such Proceeding that relates to Taxes for which such
Party is or may be liable pursuant to this Agreement; provided, however, that
New D&B shall have the right to control, at its own expense, all Proceedings in
respect of the Consolidated Return and 1998 combined state and local Income Tax
Returns.
(b) The Party in control of a Proceeding or any part thereof
pursuant to Section 5.1(a) above shall consult with the other Party with respect
to any issue that may affect such other Party (or Subsidiary). The Party in
control of such Proceeding or any part thereof shall not enter into any final
settlement or closing agreement that may adversely affect the other Party (or
Subsidiary) without the consent of such other Party, which consent may not
unreasonably be withheld. Where consent to any final settlement or closing
agreement is withheld, the Party withholding consent shall continue or initiate
further proceedings, at its own expense, and the liability of the Party in
control of such Proceeding shall not exceed the liability that would have
resulted from the proposed closing agreement or final settlement (including
interest, additions to Tax and penalties which have accrued at that time).
SECTION 5.2. Cooperation. The Corporation and New D&B shall
cooperate with each other in the filing of any Tax Returns and the conduct of
any audit or other proceeding and each shall execute and deliver such powers of
attorney and other documents and make available such information and documents
as are necessary to carry out the intent of this Agreement. To the extent such
cooperation involves the services of officers, directors, employees, or agents
of either Party, such services shall be made available in accordance with
Section 2.9 of the Distribution Agreement. Each Party agrees to notify the other
Party of any audit adjustment that does not result in Tax liability but can
reasonably be expected to affect Tax Returns of the other Party or any of its
Subsidiaries. Notwithstanding any other provision of this Agreement, if a Party
(the "Nonperforming Party") fails to give its full cooperation and use its best
efforts in the conduct of an audit or other proceeding as provided by this
Section 5.2, and such failure results in the imposition of additional Taxes for
the period or periods involved in the audit or other proceeding, the
Nonperforming Party shall be liable in full for such additional Taxes.
SECTION 5.3. Retention of Records; Access.
(a) The Corporation and New D&B shall, and shall cause each of their
Controlled Entities to, retain adequate records, documents, accounting data and
other information (including
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computer data) necessary for the preparation and filing of all Tax Returns
required to be filed by any member of the Pre-Distribution D&B Group or any
combination of such members and for any audits and litigation relating to such
Tax Returns or to any Taxes payable by any member of the Pre-Distribution D&B
Group or any combination of such members.
(b) The Corporation and New D&B shall, and shall cause each of their
Controlled Entities to, give to the other Party reasonable access to (i) all
records, documents, accounting data and other information (including computer
data) necessary for the preparation and filing of all Tax Returns required to be
filed by any member of the Pre-Distribution D&B Group or any combination of such
members and for any audits and litigation relating to such Tax Returns or to any
Taxes payable by any member of the Pre-Distribution D&B Group or any combination
of such members and (ii) its personnel and premises, for the purpose of the
review or audit of such reports or returns to the extent relevant to an
obligation or liability of a Party under this Agreement and in accordance with
the procedures provided in Article IV of the Distribution Agreement.
(c) The obligations set forth above in Sections 5.3(a) and 5.3(b)
shall continue until the final conclusion of any litigation to which the records
and information relate or until expiration of all applicable statutes of
limitations, whichever is longer. For purposes of the preceding sentence, each
Party shall assume that no applicable statute of limitations has expired unless
such Party has received notification or otherwise has knowledge that such
statute of limitations has expired.
(d) Notwithstanding any other provision of this Agreement, if a
Party fails to comply with any of its obligations set forth in this Section 5.3
and such failure results in the imposition of additional Taxes, such
nonperforming Party shall be liable in full for such additional Taxes.
SECTION 5.4. Dispute Resolution. Any dispute or claim arising out
of, in connection with, or in relation to the interpretation, performance,
nonperformance, validity or breach of this Agreement or otherwise arising out
of, or in any way related to this Agreement, shall be resolved in the manner set
forth in Article VI of the Distribution Agreement.
SECTION 5.5. Confidentiality; Ownership of Information; Privileged
Information. The provisions of Article IV of the Distribution Agreement relating
to confidentiality of information, ownership of information, privileged
information and related matters shall apply with equal force to any records and
information prepared and/or shared by and among the Parties in carrying out the
intent of this Agreement.
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ARTICLE VI. MISCELLANEOUS
SECTION 6.1. Complete Agreement; Construction. This Agreement,
including the Exhibits and Schedules, and the Ancillary Agreements shall
constitute the entire agreement between the Parties with respect to the subject
matter hereof and shall supersede all previous negotiations, commitments and
writings with respect to such subject matter. In the event of any inconsistency
between this Agreement and any Schedule hereto, the Schedule shall prevail.
SECTION 6.2. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more such counterparts have been signed
by both Parties.
SECTION 6.3. Survival of Agreements. Except as otherwise
contemplated by this Agreement, all covenants and agreements of the Parties
contained in this Agreement shall survive the Distribution Date.
SECTION 6.4. Expenses. Except as otherwise set forth in this
Agreement, all costs and expenses incurred on or prior to the Distribution Date
(whether or not paid on or prior to the Distribution Date) in connection with
the preparation, execution, delivery and implementation of this Agreement shall
be charged to and paid by New D&B. Except as otherwise set forth in this
Agreement, each Party shall bear its own costs and expenses incurred after the
Distribution Date.
SECTION 6.5. Notices. All notices and other communications hereunder
shall be in writing and hand delivered or mailed by registered or certified mail
(return receipt requested) or sent by any means of electronic message
transmission with delivery confirmed (by voice or otherwise) to the Parties at
the following addresses (or at such other addresses for a Party as shall be
specified by like notice) and will be deemed given on the date on which such
notice is received:
To the Corporation:
The Xxxxxx X. Xxxxxxxxx Corporation
One Manhattanville Road
Purchase, N.Y. 10577
Attn: General Counsel
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To New D&B:
The Dun & Bradstreet Corporation
Xxx Xxxxxxx Xxxx Xxxx
Xxxxxx Xxxx, XX 00000
Attn: General Counsel
SECTION 6.6. Waivers. The failure of any Party to require strict
performance by the other Party of any provision in this Agreement will not waive
or diminish that Party's right to demand strict performance thereafter of that
or any other provision hereof.
SECTION 6.7. Amendments. This Agreement may not be modified or
amended except by an agreement in writing signed by the Parties hereto.
SECTION 6.8. Assignment. This Agreement shall not be assignable, in
whole or in part, directly or indirectly, by any Party hereto without the prior
written consent of the other Party hereto, and any attempt to assign any rights
or obligations arising under this Agreement without such consent shall be void.
SECTION 6.9. Successors and Assigns. The provisions to this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the Parties and their respective successors and permitted assigns.
SECTION 6.10. Termination. This Agreement may be terminated,
amended, modified or abandoned at any time prior to the Distribution by and in
the sole discretion of the Corporation without the approval of New D&B or the
stockholders of the Corporation. In the event of such termination, no Party
shall have any liability of any kind to any other Party or any other person.
After the Distribution, this Agreement may not be terminated except by an
agreement in writing signed by the Parties.
SECTION 6.11. Controlled Entities. Each of the Parties hereto shall
cause to be performed, and hereby guarantees the performance of, all actions,
agreements and obligations set forth herein to be performed by any Controlled
Entity of such Party or by any entity that is contemplated to be a Controlled
Entity of such Party on and after the Distribution Date.
SECTION 6.12. Third Party Beneficiaries. This Agreement is solely
for the benefit of the Parties hereto and their respective Subsidiaries and
should not be deemed to confer upon third parties any remedy, claim, liability,
reimbursement, claim of action or other right in excess of those existing
without reference to this Agreement.
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SECTION 6.13. Title and Headings. Titles and headings to sections
herein are inserted for the convenience of reference only and are not intended
to be a part of or to affect the meaning or interpretation of this Agreement.
SECTION 6.14. Exhibits and Schedules. The Exhibits and Schedules
shall be construed with and as an integral part of this Agreement to the same
extent as if the same had been set forth verbatim herein.
SECTION 6.15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK.
SECTION 6.16. Consent to Jurisdiction. Without limiting the
provisions of Section 5.4 hereof, each of the Parties irrevocably submits to the
exclusive jurisdiction of (a) the Supreme Court of the State of New York, New
York County, and (b) the United States District Court for the Southern District
of New York, for the purposes of any suit, action or other proceeding arising
out of this Agreement or any transaction contemplated hereby. Each of the
Parties agrees to commence any action, suit or proceeding relating hereto either
in the United States District Court for the Southern District of New York or if
such suit, action or other proceeding may not be brought in such court for
jurisdictional reasons, in the Supreme Court of the State of New York, New York
County. Each of the Parties further agrees that service of any process, summons,
notice or document by U.S. registered mail to such Party's respective address
set forth above shall be effective service of process for any action, suit or
proceeding in New York with respect to any matters to which it has submitted to
jurisdiction in this Section 6.16. Each of the Parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Supreme Court of the State of New York, New York County, or
(ii) the United States District Court for the Southern District of New York, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
SECTION 6.17. Severability. In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby. The Parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions, the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be
duly executed as of the day and year first above written.
THE DUN & BRADSTREET CORPORATION
By:
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Name:
Title:
THE NEW DUN & BRADSTREET
CORPORATION
By:
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Name:
Title:
