Form of Tax Equalization Agreement] [Messrs. Bürker, Filliol, Lang, Lüthi, Spoerry, von Arb and Widmer]
Exhibit 10.58
[Form of Tax
Equalization Agreement]
[Messrs. Bürker,
Filliol, Lang, Lüthi, Spoerry, von Arb and Xxxxxx]
(by internal
mail)
Date October 10, 2007
Reference JTB
Direct dial x00 00 000-0000
Telefax x00 00 000-0000
Dear Mr. [name]:
The company has requested that you file US income tax returns to
ensure you are in full compliance with US tax laws. This filing
requirement is due to your working part of your time in the
United States in your capacity as an officer of Xxxxxxx-Xxxxxx
International Inc.
As a Swiss tax resident, generally you are already subject to
Swiss income taxes on earnings related to US workdays. Although
a portion of your earnings subject to tax in the U.S. may
be excluded from taxation in Switzerland, depending on your
situation, a double taxation cost could result absent the
provisions of this agreement.
You will also have additional tax return preparation costs
associated with the filing of US income tax returns, and,
possibly, in connection with filing your Swiss tax declaration.
In connection with these matters, we have agreed to seek to keep
you in the same position that you would have been in had no US
income tax return been filed. It is our intention that your
financial situation be no better and no worse than if no US
returns were filed. In particular, we have agreed to the
following:
Additional income
taxes
The company will pay any higher income taxes that result from
your filing US income tax returns, whether in the United States
or in Switzerland.
Additional tax
return preparation expenses
The company will engage and pay for accountants to prepare your
US income tax returns, and will also pay for any additional
counseling necessary to prepare and file your Swiss tax
declaration in the future if the filing requires changes from
the process followed in prior years.
Tax payments
The company will pay your US tax liabilities on your behalf, as
well as any interest and penalties due on this additional tax
liability, provided that you comply with requests from the
company
and/or the
accountants in a timely manner. For ease of administration,
while this agreement is in effect, the company will timely
deposit with the appropriate taxing authority the applicable
U.S. tax calculated on the U.S. compensation you
receive from XXXXXXX TOLEDO. All payments by the company under
this agreement to reimburse you for additional Swiss tax, if
any, shall be made no later than the end of the second calendar
year that begins after the calendar year in which you receive a
final assessment requiring Swiss tax to be paid.
You agree that any amount by which your Swiss tax liability is
decreased from what it would have been had the US tax payments
not been made will be promptly repaid to the company as soon as
your Swiss tax liability for a given year has been paid and an
equalization calculation is prepared on the company’s
behalf.
Coverage and scope
of agreement
This agreement covers all income related to your employment with
XXXXXXX TOLEDO, including income upon option exercises or other
equity incentives. This agreement does not extend to income from
sources other than XXXXXXX TOLEDO, except for passive income on
US investments to the extent not otherwise subject to taxation
in Switzerland.
If your employment with the company is terminated, this
agreement will continue to apply until all tax returns that
report XXXXXXX TOLEDO source income have been filed and tax
liabilities related to XXXXXXX TOLEDO income have been
concluded. In addition, it is the intent of the company to only
indemnify you for incremental taxes as if income from XXXXXXX
TOLEDO was your only US source income.
If you are in agreement to proceeding on this basis, please sign
below and return a copy.
Xxxxxxx-Xxxxxx
International Inc.
By: |
Xxxxx X.
Xxxxxxxxxx
|
Title: | General Counsel |
Acknowledged and Agreed:
[name]