Exhibit 10.3
TAX SEPARATION AND INDEMNIFICATION AGREEMENT
This TAX SEPARATION AND INDEMNIFICATION AGREEMENT (the "Agreement"), dated
_____________, 2003, is by and among Alliant Energy Corporation, a Wisconsin
corporation ("Alliant Energy"), Alliant Energy Resources, Inc., a Wisconsin
corporation ("Resources"), Xxxxxxx Petroleum Corporation, a Delaware corporation
("WPC"), Xxxxxxx Oil and Gas Corporation, a Delaware corporation ("Xxxxxxx"),
and three wholly-owned subsidiaries of Xxxxxxx: Xxxxxxx-Xxxxxx Gas Corporation,
an Oklahoma corporation, Xxxxxxx Programs, Inc., a Delaware corporation and WOK
Acquisition Company, a Delaware corporation (the three subsidiaries are
collectively referred to as "Xxxxxxx Subs").
PREAMBLE:
WHEREAS, Resources, Xxxxxxx and Xxxxxxx Subs have been members of an
affiliated group of corporations filing consolidated federal income tax returns
of which Alliant Energy is the common parent (the "Alliant Energy Group") and
filing certain state, local and foreign income or franchise tax returns on a
combined, consolidated, unitary or other similar basis (such federal, state,
local and foreign tax returns are collectively referred to as the "Consolidated
Returns");
WHEREAS, Alliant Energy, Resources, Xxxxxxx and Xxxxxxx Subs are parties to
the Alliant Energy Corporation Tax Allocation Agreement (the "Tax Allocation
Agreement"), which became effective for tax years ending on or after December
31, 1999;
WHEREAS, WPC is acquiring all of the outstanding stock of Xxxxxxx from
Resources (the "Transfer") pursuant to the Master Separation Agreement dated
_________, 2003, by and among WPC, Xxxxxxx, Resources and Alliant Energy;
WHEREAS, upon consummation of the Closing (as such term is defined below),
Xxxxxxx, Xxxxxxx Subs and WPC will become members of an affiliated group of
corporations (the "Buyer Group") and Xxxxxxx and Xxxxxxx Subs will cease to be
members of the Alliant Energy Group; and
WHEREAS, the parties wish to assign responsibility for the preparation and
filing of tax returns; to set forth the methodology for determining their
respective liabilities for Taxes (as such term is defined below) and for
allocating such liabilities among themselves for all Taxes that may be owed to
or assessed by the Internal Revenue Service or any other comparable state, local
or foreign governmental authority attributable to the periods before, after
and/or including the Closing Date (as such term is defined below); to establish
procedures for reimbursing one party for Taxes allocated to the other under this
Agreement; and to provide for certain tax elections and for the division of any
tax benefits which may arise as a result of such elections.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereby agree as follows:
1. Definitions. For purposes of this Agreement, the following terms shall
be defined as follows:
1.1 "Actual Tax Liability" has the meaning specified in Section 1.38
hereof.
1.2 "ADSP" means "aggregate deemed sale price" as such term is defined
in the regulations under Section 338 of theCode.
1.3 "AGUB" means "adjusted grossed-up basis" as such term is defined
in the regulations under Section 338 of the Code.
1.4 "Alliant Energy" means Alliant Energy Corporation, a Wisconsin
corporation.
1.5 "Alliant Energy Group" has the meaning specified in the Preamble
of this Agreement.
1.6 "Allocation Schedule" has the meaning specified in Section 5.1
hereof.
1.7 "AMT Credits" has the meaning specified in Section 1.26 hereof.
1.8 "Buyer" means WPC and any successors thereto.
1.9 "Buyer Group" has the meaning specified in the Preamble of this
Agreement.
1.10 "Change of Control" means the occurrence of any one or more of
the following events subsequent to the Closing Date: (i) the acquisition by an
individual, entity or other "person" (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 50% or more of either (a) the outstanding
shares of common stock of Buyer (the "Outstanding Buyer Common Stock") or (b)
the combined voting power of the then outstanding voting securities of Buyer
entitled to vote generally in the election of directors (the "Outstanding Buyer
Voting Securities"); (ii) the acquisition by any Person, other than Buyer, of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more of either (a) the then outstanding shares of common
stock of Xxxxxxx (the "Outstanding Xxxxxxx Common Stock") or (b) the combined
voting securities of Xxxxxxx entitled to vote generally in the election of
directors (the "Outstanding Xxxxxxx Voting Securities"); (iii) any
reorganization (including, but not limited to, transactions described in Section
368(a) of the Code), merger, share exchange, or consolidation involving Buyer or
any subsidiary of Buyer (each, a "Buyer Merger"), unless, immediately following
any such Buyer Merger (a) more than 50% of the then Outstanding Buyer Common
Stock and 50% of the then Outstanding Buyer Voting Securities are then
beneficially owned, directly or indirectly, by Persons who were the beneficial
owners, respectively, of the Outstanding Buyer Common Stock and the Outstanding
Buyer Voting Securities immediately prior to such Buyer Merger and (b) no Person
beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) 25% or more of either (1) the then Outstanding Buyer Common Stock
or (2) the then Outstanding Buyer Voting Securities; or (iv) any
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reorganization (including, but not limited to, transactions described in section
368(a) of the Code), merger, share exchange, or consolidation involving Xxxxxxx
(each, a "Xxxxxxx Merger"), unless immediately following any such Xxxxxxx
Merger, Buyer beneficially owns, directly or indirectly, at least 80% of the
Outstanding Xxxxxxx Common Stock and 80% of the Outstanding Xxxxxxx Voting
Securities.
1.11 "Closing" means the closing of the Transfer and the immediate
sale of more than 50% of the stock of WPC to underwriters by Resources.
1.12 "Closing Date" means the date on which the Closing occurs.
1.13 "Code" means the Internal Revenue Code of 1986, as amended. All
section references to the Code also include any successor sections thereto.
1.14 "Consolidated Returns" has the meaning specified in the Preamble
of this Agreement, and the term "Consolidated Return" means any one of the
Consolidated Returns.
1.15 "Disputed Allocation" has the meaning specified in Section 5.2
hereof.
1.16 "Disputed Amount" has the meaning specified in Section 9.3.3
hereof.
1.17 "Estimated Tax Payment Date" means any of the dates specified in
Section 6655 of the Code for the payment of Buyer's estimated U.S. federal
income tax.
1.18 "Fair Market Value Schedule" has the meaning specified in Section
5.1 hereof.
1.19 "Interim Period" has the meaning specified in Section 3.1 hereof.
1.20 "Lump Sum Record Date" means the last day of Buyer's taxable year
that includes the 10th anniversary of the Closing Date.
1.21 "Lump Sum Payment Date" means the Return Due Date for the taxable
year that ends on the Lump Sum Record Date.
1.22 "Lump Sum Tax Benefit Amount" has the meaning specified in
Section 8.6 hereof.
1.23 "Notional Tax Liability" has the meaning specified in Section
1.38 hereof.
1.24 "Other Returns" has the meaning specified in Section 2.2 hereof.
1.25 "Prepayment Amount" has the meaning specified in Section 8.4
hereof.
1.26 "Realized Section 29 Tax Credits" has the meaning specified in
Section 7.1 hereof.
1.27 "Resources" means Alliant Energy Resources, Inc., a Wisconsin
corporation.
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1.28 "Returns" means all returns, declarations, reports, statements
and other documents required to be filed in respect of Taxes, and the term
"Return" means any one of the foregoing Returns.
1.29 "Return Due Date" means the date specified in Section 6072 of the
Code for the filing of Buyer's income tax returns, as may be validly extended by
Buyer pursuant to the automatic extension procedure under the Code and the
regulations thereunder.
1.30 "Section 29 Tax Credits" means the tax credits under Section 29
of the Code attributable to Xxxxxxx'x and Xxxxxxx Subs' activities during the
taxable year ending on December 31, 2002 that were not utilized in the Alliant
Energy Group's consolidated U.S. Corporation Income Tax Return for taxable year
2002. The amount of such Section 29 Tax Credits is approximately $4,350,000
(such amount is subject to the adjustment by the IRS or otherwise). By operation
of the corporate alternative minimum tax, the Section 29 Tax Credits carry over
to Alliant Energy Group's U.S. federal Consolidated Return for taxable year
ending on December 31, 2003 and future years as part of the Alliant Energy
Group's alternative minimum tax credits. The Alliant Energy Group's alternative\
minimum tax credits generated in taxable year 2002 are referred to as the
"AMT Credits."
1.31 "Section 338(h)(10) Election" has the meaning specified in
Section 4 hereof.
1.32 "Short Period" has the meaning specified in Section 3.1 hereof.
1.33 "Tax" means any one of the Taxes. "Taxes" means all federal,
state, local and foreign taxes, including interest and penalties, on, based on,
measured by, or with respect to, income, net income, net worth or capital
(including without limitation the Michigan single business tax); provided that
Taxes shall not include deferred income taxes.
1.34 "Tax Allocation Agreement" has the meaning specified in the
Preamble of this Agreement.
1.35 "Tax Authority" means the Internal Revenue Service or any other
comparable state, local or foreign governmental authority.
1.36 "Tax Benefit Base Amount" for any Taxable Period means (i) any
increase in an amortization, depreciation, expense or loss deduction in such
Taxable Period or any decrease in an item of income or gain in such Taxable
Period attributable to, or as a result of, the basis adjustments due to the
Section 338(h)(10) Election, including any basis increases attributable to, or
as a result of, payments made pursuant to this Agreement, (ii) any portion of
payments made pursuant to this Agreement characterized as interest or original
issue discount for tax purposes, or (iii) any increase in any net operating or
capital loss carryover or carryback or tax credit that is carried to such
Taxable Period and that arose or arises in a prior or subsequent Taxable Period
as a result of any such increase in deduction or decrease in income or gain
under (i) or (ii) in such prior or subsequent Taxable Period.
1.37 "Tax Benefit Issue" has the meaning specified in Section 9.3.1
hereof.
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1.38 "Tax Benefits" means, for any Taxable Period, the excess, if any,
of (a) the total amount of U.S. federal, state, local and foreign income and
franchise taxes that would be payable by Xxxxxxx or any other member of the
Buyer Group in respect of such Taxable Period if the Tax Benefit Base Amount for
such Taxable Period were not taken into account ("Notional Tax Liability"), over
(b) the total amount of U.S. federal, state, local and foreign income and
franchise taxes payable by Xxxxxxx or any other member of the Buyer Group in
respect of such Taxable Period after taking into account the Tax Base Benefit
Amount for such Taxable Period (the "Actual Tax Liability"); provided, however,
that the Tax Benefits for any Taxable Period shall be no less than the Tax
Benefits calculated without giving effect to any items of income, gain, expense,
loss, deduction, credit or related carryovers or carrybacks directly
attributable to or related to any businesses, assets or liabilities other than
(i) the businesses conducted by Xxxxxxx or any other member of the Buyer Group
prior to Closing, (ii) any assets held by Xxxxxxx or any other member of the
Buyer Group immediately prior to Closing and (iii) any liabilities of Xxxxxxx or
any other member of the Buyer Group immediately prior to Closing (the "Minimum
Tax Benefits"). Any Tax Benefits hereunder shall be determined using the method
of reporting (i.e., consolidated, combined or separate returns) actually
utilized by Xxxxxxx or the particular member of the Buyer Group. In any Taxable
Period ending prior to or on the date of a Change of Control, the Tax Benefits
shall equal the amount calculated as provided above in this Section 1.38. In any
Taxable Period ending subsequent to a Change of Control, the Tax Benefits shall
be the greater of (i) the Tax Benefits calculated as if a Change of Control had
not occurred, with the Notional Tax Liability and the Actual Tax Liability
calculated by including only items of income, gain, expense, loss, deduction,
credit and related carryovers and carrybacks directly attributable or related to
the businesses conducted by Xxxxxxx or any other member of the Buyer Group prior
to the Change of Control (the "Historic Businesses") and excluding all items of
income, gain, expense, loss, deduction, credit or related carryovers or
carrybacks not attributable or related to the Historic Businesses as conducted
by Xxxxxxx or any other member of the Buyer Group prior to the Change of Control
(including, without limitation, any interest expense incurred by Xxxxxxx or any
other member of the Buyer Group after the Change of Control, whether or not to a
related person, or any fees, expenses or other charges to any related person
unless directly related to the Historic Businesses as conducted by Xxxxxxx or
any other member of the Buyer Group prior to the Change of Control), (ii) the
excess of the Notional Tax Liability over the Actual Tax Liability, calculated
by including all items of income, gain, expense, loss, deduction, credit and
related carryovers and carrybacks of any corporation or group of corporations
filing a federal or other consolidated, combined or unitary income or franchise
tax return entitled to the Tax Benefit Base Amount, and (iii) the Minimum Tax
Benefits.
1.39 "Taxable Period" means any taxable year (or portion thereof)
ending after the Closing Date.
1.40 "Transfer" has the meaning specified in the Preamble of this
Agreement.
1.41 "Underpayment Rate" has the meaning specified in Section 9.3.2
hereof.
1.42 "Xxxxxxx" means Xxxxxxx Oil and Gas Corporation, a Delaware
corporation.
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1.43 "Xxxxxxx Subs" means Xxxxxxx-Xxxxxx Gas Corporation, an Oklahoma
corporation, Xxxxxxx Programs, Inc., a Delaware corporation, and WOK Acquisition
Company, a Delaware corporation. A "Xxxxxxx Sub" means any one of the Xxxxxxx
Subs.
1.44 "WPC" means Xxxxxxx Petroleum Corporation, a Delaware
corporation.
2. Preparation and Filing of Tax Returns.
2.1 Preparation. Alliant Energy shall prepare or cause to be prepared
all Consolidated Returns with respect to Xxxxxxx and Xxxxxxx Subs and the
Returns set forth on Schedule A attached hereto, but only for taxable periods
ending on, prior to, or including the Closing Date. Buyer, Xxxxxxx and Xxxxxxx
Subs shall prepare or cause to be prepared all other Returns of Buyer, Xxxxxxx
and Xxxxxxx Subs. Buyer, Xxxxxxx and Xxxxxxx Subs shall prepare or cause to be
prepared work papers and schedules with respect to Xxxxxxx and Xxxxxxx Subs
setting forth all of the information necessary for Alliant Energy to properly
prepare any Consolidated Return or other return set forth on Schedule A
consistent with past practices on a timely basis. All such Returns shall be
prepared using accounting methods, tax elections and tax positions as determined
by Alliant Energy in its sole discretion, but only for taxable periods ending
on, prior to, or including the Closing Date.
2.2 Filing. Alliant Energy shall file or cause to be filed all
Consolidated Returns with respect to Xxxxxxx and Xxxxxxx Subs for taxable
periods ending on, prior to, or including the Closing Date. Buyer, Xxxxxxx and
Xxxxxxx Subs shall file or cause to be filed all other Returns of Buyer, Xxxxxxx
and Xxxxxxx Subs ("Other Returns"), including those set forth on Schedule A.
3. Obligation for Taxes. Except as provided in Section 4 of this
Agreement, Buyer, Xxxxxxx and Xxxxxxx Subs shall be responsible for all Taxes of
Buyer, Xxxxxxx and Xxxxxxx Subs.
3.1 Taxes Due with Respect to Consolidated Returns. Alliant Energy
shall timely pay or cause to be paid all Taxes on behalf of Xxxxxxx and Xxxxxxx
Subs that are due with respect to the Consolidated Returns for taxable periods
ending on, prior to, or including the Closing Date. With the exception of the
Tax liability on the deemed asset sale as a result of the Section 338(h)(10)
Election (as set forth in this Section 3.1 and Section 4 of this Agreement),
Buyer, Xxxxxxx and Xxxxxxx Subs shall reimburse Alliant Energy for (i) Xxxxxxx'x
and Xxxxxxx Subs' portions of the U.S. federal consolidated income tax of the
Alliant Energy Group in accordance with the Tax Allocation Agreement as if each
of Xxxxxxx and Xxxxxxx Subs remained a "member of the Group" as set forth
therein, and (ii) Xxxxxxx'x and Xxxxxxx Subs' portions of all other Taxes on
such Consolidated Returns using similar principles and procedures as used in the
Tax Allocation Agreement to determine a member's portion of the U.S. federal
consolidated income tax liability of the Alliant Energy Group. Such Taxes shall
be determined by closing Xxxxxxx'x and Xxxxxxx Subs' books and records as of and
including the Closing Date, or if the allocation of an item of income, gain,
expense, loss, deduction, credit or related carryovers or carrybacks cannot be
definitely allocated to an ascertainable date, such item shall be pro rated on a
daily basis. The parties hereto will, to the extent permitted by applicable law,
elect with the relevant Tax Authority to treat for all purposes the Closing Date
as the last day of a taxable
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period of Xxxxxxx and Xxxxxxx Subs. The period January 1, 2003, through and
including the Closing Date shall be treated as a "Short Period" for purposes of
this Agreement. In any case where applicable law does not permit Xxxxxxx or
Xxxxxxx Subs to treat the Closing Date as the last day of a Short Period, then
for purposes of this Agreement, Buyer, Xxxxxxx and Xxxxxxx Subs shall pay all
such Taxes that are attributable to the operation of Xxxxxxx and Xxxxxxx Subs
for such Interim Period (as defined below) as follows: (i) in the case of Taxes
that are not based in whole or in part on income or gross receipts, the total
amount of such Taxes for the period in question multiplied by a fraction, the
numerator of which is the total number of days in the Interim Period, and the
denominator of which is the total number of days in the entire period in
question, and (ii) in the case of Taxes that are based in whole or in part on
income or gross receipts, the Taxes that would be due with respect to the
Interim Period, if such Interim Period were a Short Period. "Interim Period"
means, with respect to any Taxes imposed on Xxxxxxx or Xxxxxxx Subs for which
the Closing Date is not the last day of a Short Period, the period of time
beginning on the first day of the actual taxable period that includes the
Closing Date and ending on and including the Closing Date. Buyer, Xxxxxxx and
Xxxxxxx Subs shall not be required to reimburse Alliant Energy for Taxes due on
Consolidated Returns for taxable periods beginning after the Closing Date.
3.2 Taxes Due with Respect to Other Returns. Buyer, Xxxxxxx and
Xxxxxxx Subs shall pay or cause to be paid timely to the relevant Tax Authority
all Taxes that are due with respect to the Other Returns, including those set
forth on Schedule A.
4. Section 338(h)(10) Election. Buyer and Alliant Energy and, if
necessary, Resources, Xxxxxxx, and/or Xxxxxxx Subs, shall timely make or cause
to be made a valid joint election under Section 338(h)(l0) of the Code and
equivalent elections under comparable state, local or foreign law as may be
requested by Alliant Energy (in its sole discretion) relating to the Transfer
(collectively, the "Section 338(h)(10) Election"). Buyer, Xxxxxxx, Xxxxxxx Subs,
Alliant Energy and Resources shall each file, or cause to be filed, their
federal Tax Returns treating the Transfer as a sale of the assets of Xxxxxxx and
Xxxxxxx Subs followed by a liquidation pursuant to Section 338(h)(10) of the
Code. If an equivalent election is made for state, local or foreign Tax
purposes, the parties shall each file on a similar basis all of their state,
local and foreign Tax Returns. Buyer, Xxxxxxx and Xxxxxxx Subs shall timely
assist Alliant Energy in making the Section 338(h)(10) Election, including
without limitation, completing all relevant forms, schedules, and other
documents and all Tax Returns reflecting the Section 338(h)(10) Election.
Notwithstanding anything to the contrary contained in the Tax Allocation
Agreement, Alliant Energy shall be responsible for the Taxes resulting from the
deemed asset sale on account of the Section 338(h)(10) Election (the calculation
of such Taxes shall take into account all current deductions as a result of a
liability being treated as part of ADSP). If a Section 338(h)(10) Election is
made, Buyer, Xxxxxxx and Xxxxxxx Subs shall cause each partnership (and each
entity taxed as a partnership for Tax purposes) in which any of them has an
interest to make an election under Section 754 of the Code to the extent such
election maximizes the amount of Tax Benefits, the Prepayment Amount and the
Lump Sum Tax Benefit Amount to be paid to Resources as determined by Alliant
Energy or Resources in their sole discretion.
5. Valuation and Allocation of Consideration.
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5.1 General. The parties agree that ADSP, AGUB and similar terms under the
relevant state, local or foreign law with respect to the Transfer and the
Section 338(h)(10) Election and any post-Closing adjustment thereto shall be
determined by Alliant Energy, such determination to be made, in part, based on
the sales price per share of the common stock of Buyer to the underwriters.
Within ninety (90) days after the Closing Date, Buyer or Xxxxxxx shall deliver
to Alliant Energy a schedule that sets forth the fair market value of each asset
of Xxxxxxx and Xxxxxxx Subs and a schedule that allocates the value of the
consideration among the assets of Xxxxxxx and Xxxxxxx Subs, which schedules are
subject to the review, approval and adjustment by Alliant Energy, which review,
approval and adjustment shall include, but is not limited to, making necessary
adjustments to make the allocations consistent with any post-Closing Date
adjustments; provided, however, that any adjustments to the initial schedules
prepared by Buyer or Xxxxxxx shall be mutually agreed to by Buyer or Xxxxxxx, on
the one hand, and Alliant Energy, on the other. The schedule setting forth the
fair market value of each asset of Xxxxxxx and Xxxxxxx Subs as mutually agreed
to by the parties is referred to as the "Fair Market Value Schedule." The
schedule setting forth the allocation of the value of the consideration among
the assets of Xxxxxxx and Xxxxxxx Subs as mutually agreed to by the parties is
referred to as the "Allocation Schedule." The Allocation Schedule shall be
revised to reflect any subsequent adjustments to ADSP or AGUB or similar terms
(including without limitation as a result of the payments made pursuant to this
Agreement) in accordance with each asset's fair market value as set forth on the
Fair Market Schedule. The parties (i) shall be bound by the fair market values
of the assets set forth on the Fair Market Value Schedule and the allocation set
forth on the Allocation Schedule (as may be revised from time to time) for
purposes of determining any Taxes, Tax Benefits, the Prepayment Amount and the
Lump Sum Tax Benefit Amount, and (ii) shall prepare and file all Returns (and
Buyer, Xxxxxxx and any other member of the Buyer Group shall file amended
Returns if requested by Alliant Energy) in a manner consistent with such
allocation as set forth on such Allocation Schedule (as may be revised from time
to time). In the event that any Tax Authority disputes such allocation, the
party receiving notice of such dispute shall promptly notify and consult with
the other parties hereto concerning resolution of such dispute.
5.2 Resolution of Allocation Disputes. If the parties hereto are unable to
mutually agree on the fair market values of the assets set forth on the Fair
Market Value Schedule or the allocation on the initial Allocation Schedule
described in Section 5.1 hereof within sixty (60) days (the "Disputed
Allocation") following delivery thereof, the determination of such Disputed
Allocation shall be made by an independent firm of certified public accountants
jointly selected by Alliant Energy and Buyer. If Alliant Energy and Buyer cannot
agree on the selection of an independent firm of certified public accountants,
such firm will be jointly selected by the firms of certified public accountants
that certify (or selected by the firm of certified public accountants that
certifies) the financial statements of Alliant Energy and Buyer and such firm
cannot be one of the selecting firm(s). Such accountants shall be given access
by Alliant Energy, Buyer and their respective subsidiaries to all information
necessary to determine the Disputed Allocation, subject to the agreement of such
accountants that such information shall be kept confidential and shall not be
released without the written consent of Alliant Energy or Buyer, as appropriate,
except as compelled by legal process. The Disputed Allocation as determined by
the accountants shall be final and binding on the parties, and the parties agree
to be bound thereby and to act accordingly. Each of Alliant Energy and Buyer
(and their subsidiaries) shall pay its own costs and expenses incurred in
determining the Disputed Allocation. Resources and
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Buyer shall share equally the costs of the independent firm of certified public
accountants selected to determine the Disputed Allocation.
6. Subsequent Assessments or Refunds.
6.1 Tax Adjustment Relating to Consolidated Returns. In the event
there is an adjustment with respect to a Consolidated Return for a taxable
period ending on, prior to or including the Closing Date subsequent to the
preparation of such Return and payment and reimbursement of the Taxes shown
as due thereon, Alliant Energy shall pay or cause to be paid any Taxes and
be entitled to receive all refunds of Taxes. If, as a result of the
adjustment, additional Tax is due, then Buyer, Xxxxxxx and Xxxxxxx Subs
shall reimburse Alliant Energy the portion of such Tax due attributable to
Xxxxxxx or Xxxxxxx Subs calculated using the same principles as set forth
in Section 3.1 hereof within ten (10) days after notice thereof. If, as a
result of the adjustment, the Alliant Energy Group is entitled to a Tax
refund, then Alliant Energy shall pay to Buyer, Xxxxxxx or Xxxxxxx Subs the
portion of such Tax refund attributable to Xxxxxxx or Xxxxxxx Subs
calculated in the same manner as Tax liabilities are calculated as set
forth in Section 3.1 hereof within ten (10) days after receipt thereof.
6.2 Tax Adjustment Relating to Other Returns. In the event there is an
adjustment with respect to the Other Returns subsequent to the preparation
of such Returns and payment of the Taxes due, Buyer, Xxxxxxx and Xxxxxxx
Subs shall pay or cause to be paid any Taxes and be entitled to receive all
refunds of Taxes with respect to such Other Returns.
7. Section 29 Tax Credits.
7.1 Realized Section 29 Tax Credits. "Utilized AMT Credits" means, for
any taxable period ending after the Closing Date, an amount equal to the
excess, if any, of (a) the total amount of U.S. federal income tax that
would be payable by the Alliant Energy Group in respect to such taxable
period if the AMT Credits were not taken into account, over (b) the total
amount of U.S. federal income tax payable by the Alliant Energy Group in
respect to such taxable period taking into account the AMT Credits (if any)
for such taxable period in accordance with the Code and the regulations
thereunder. For purposes of determining whether the AMT Credits are taken
into account for such taxable period for purpose of calculating Utilized
AMT Credits and the amount of AMT Credits remaining under this Agreement,
the alternative minimum tax credits (including the AMT Credits) generated
from the earliest year shall be deemed to be used first (i.e., on a
First-In-First-Out basis). Realized Section 29 Tax Credits shall mean an
amount equal to the Utilized AMT Credits multiplied by a fraction, the
numerator of which is the difference between the Section 29 Credits less
cumulative amounts paid by Alliant under this Section 7.1 (as may be
adjusted under Section 7.2) and the denominator of which is the difference
between the AMT Credits less cumulative amounts of Utilized AMT Credits.
Within ten (10) days after Alliant Energy files or causes to be filed its
U.S. federal Consolidated Return for a taxable period ending after the
Closing Date, Alliant Energy shall, in lieu of any other payment under any
agreement among the parties, pay to Xxxxxxx or Xxxxxxx Subs an amount equal
to the Realized Section 29 Tax Credits (if any) for such taxable period.
Buyer, Xxxxxxx and Xxxxxxx Subs hereby acknowledge and agree that the
Alliant Energy Group may not be able to utilize its AMT Credits until
taxable year 2008 or later.
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Consequently, the amount of Realized Section 29 Tax Credits may be zero
until taxable year 2008 or later.
7.2 Tax Adjustment Relating to Realized Section 29 Tax Credits. If, as
a result of an adjustment, the amount of the Realized Section 29 Tax
Credits for a taxable period is less than the amount as computed under
Section 7.1 hereof (or as recomputed under this Section 7.2), then Buyer,
Xxxxxxx and Xxxxxxx Subs shall pay Alliant Energy the difference within ten
(10) days of notice thereof. If, as a result of an adjustment, the amount
of the Realized Section 29 Tax Credits for a taxable period is more than
the amount as computed under Section 7.1 hereof (or as recomputed under
this Section 7.2), then Alliant Energy shall pay Xxxxxxx or Xxxxxxx Subs
the difference within ten (10) days of its discovery thereof.
7.3 Payment with respect to Realized Section 29 Tax Credits. Any
amount that Alliant Energy is obligated to pay to Xxxxxxx or Xxxxxxx Subs
under this Section 7 shall first be offset by the amount that Buyer,
Xxxxxxx and Xxxxxxx Subs are obligated to pay Alliant Energy or Resources
under this Agreement.
7.4 Tax Credit Accounting. Alliant Energy shall prepare and deliver or
cause to be prepared and delivered to Buyer, Xxxxxxx or Xxxxxxx Subs, no
more than sixty (60) days after it files a U.S. federal Consolidated
Return, a good faith accounting of the amounts, if any, of the AMT Credits
utilized in such Consolidated Return, the amounts, if any, of the AMT
Credits that have not been utilized, the Section 29 Tax Credits, and the
Realized Section 29 Tax Credits. Alliant Energy's accounting obligation
shall terminate after the sum of the amounts paid to Xxxxxxx or Xxxxxxx
Subs under Sections 7.1 and 7.2 hereof and the amounts subject to offset
under Section 7.3 hereof equals the Section 29 Tax Credits.
8. Tax Benefit Sharing Payment to Resources.
8.1 Return Due Date Payments. Except as set forth in Section 8.6, with
respect to each Taxable Period, Buyer, Xxxxxxx, or Xxxxxxx Subs shall pay
to Resources, on the appropriate Return Due Date for such Taxable Period,
an amount equal to 90% of the amount of the Tax Benefits for the Taxable
Period, together with accrued interest at the Underpayment Rate determined
as follows: interest shall accrue on 22.5% (or, in the case of a Taxable
Period of less than one year, 90% divided by the number of Estimated Tax
Payment Dates in such Taxable Period) of the Tax Benefits with respect to a
Taxable Period beginning on each Estimated Tax Payment Date with respect to
such Taxable Period until paid.
8.2 Current Amount Adjustment. To the extent that the amounts paid to
Resources pursuant to Section 8.1, this Section 8.2 and Section 9.3.2
(excluding amounts for interest and penalties) hereof for a Taxable Period
exceed the sum of 90% of the amount of the actual Tax Benefits (as may be
amended or recomputed, as the case may be), such excess amounts paid shall
be paid to Buyer, Xxxxxxx or Xxxxxxx Subs by Resources. To the extent that
the amounts paid to Resources pursuant to Section 8.1, this Section 8.2 and
Section 9.3.2 (excluding amounts for interest and penalties) hereof for a
Taxable Period are less than 90% of the amount of the actual Tax Benefits
(as may be amended or recomputed, as the case may be), such deficit in
amounts shall be paid to Resources by Buyer, Xxxxxxx or Xxxxxxx Subs. All
amounts due under this Section 8.2 shall be paid within ten (10) days of
the time Buyer files its
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U.S. federal, state, local or foreign income, franchise, or other Tax
Return for the Taxable Period (or amended returns, claims for refund or
other modifications to taxable income).
8.3 Tax Computation Assumptions. The Tax Benefits, the Prepayment
Amount and the Lump Sum Tax Benefit Amount hereunder shall be calculated
separately for U.S. federal, state, local and foreign Tax purposes. When
allocation or apportionment factors are required for any Tax computation,
the factors used in Xxxxxxx'x or the affected member of the Buyer Group's
most recently filed Returns or Returns as filed (as appropriate) in the
relevant jurisdictions shall be used if actual allocation or apportionment
factors are not readily available.
8.4 Prohibited Transactions by Buyer, Xxxxxxx and Xxxxxxx Subs. Buyer,
Xxxxxxx and every member of the Buyer Group shall not (i) enter into any
transactions a significant purpose of which is to reduce the amount of the
Tax Benefits, the Prepayment Amount or the Lump Sum Tax Benefit Amount
otherwise payable to Resources under this Agreement, or (ii) enter into any
transactions which may result in the disqualification or invalidation of
the Section 338(h)(10) Election, which transactions include but are not
limited to the merger, liquidation, conversion or other corporate
transactions involving Xxxxxxx or Xxxxxxx Subs that may result in the
Internal Revenue Service or any other Tax Authority disqualifying or
invalidating any Section 338(h)(10) Election. In addition, prior to the
receipt of the Lump Sum Tax Benefit Amount by Resources, Buyer, Xxxxxxx and
every member of the Buyer Group shall not, without the prior written notice
to Alliant Energy and Resources and the prior written consent of Alliant
Energy, sell, distribute or otherwise dispose of any assets of Buyer
(including the stock of Xxxxxxx acquired pursuant to the Master Separation
Agreement), Xxxxxxx or Xxxxxxx Subs other than assets disposed of by Buyer,
Xxxxxxx or Xxxxxxx Subs in the ordinary course of business. Alliant
Energy's consent shall not be withheld unless Alliant Energy determines, in
its sole discretion, that such sale, distribution or other disposition of
assets is a transaction described in (i) or (ii) above or that the value
(considering both the timing and the amount) of the Tax Benefits or the
Lump Sum Tax Benefit Amount that Resources is entitled to receive under
this Agreement after such sale, distribution or other disposition of assets
is less than the value of the Tax Benefits or the Lump Sum Tax Benefit
Amount that Resources would have been entitled to receive under this
Agreement if such sale, distribution or other disposition had not occurred.
In the event Alliant Energy withholds its consent because the value of the
Tax Benefits or the Lump Sum Tax Benefit Amount that Resources is entitled
to receive under this Agreement after a sale, distribution or other
disposition of assets is less than the value of the Tax Benefits or the
Lump Sum Tax Benefit Amount that Resources would have been entitled to
receive under this Agreement if such sale, distribution or other
disposition had not occurred, if Buyer or Xxxxxxx, prior to ten (10) days
before the date of such sale, distribution or other disposition of assets,
pays Resources an amount equal to 90% of all of the Tax Benefits for all
taxable periods ending on, after or including the date of such sale,
distribution or other disposition (including Tax Benefits for future
Taxable Periods which shall take into account adjustments to the Tax
Benefit Base Amount as a result of the payment of the Prepayment Amount)
attributable to the assets sold, distributed or otherwise disposed of as if
all of such assets were sold for their fair market value in a fully taxable
transaction on the date of such sale, distribution or other disposition and
assuming that each of Buyer, Xxxxxxx and other members of the Buyer Group
have income or gain in excess of all available depreciation, amortization,
losses and other deductions (the "Prepayment Amount"), then Alliant Energy
and Resources shall consent to such sale, distribution or other
disposition.
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8.5 Tax Benefit Estimates. With respect to each Taxable Period ending
on or prior to the Lump Sum Record Date, Buyer, Xxxxxxx and Xxxxxxx Subs
shall prepare and deliver or cause to be prepared and delivered to
Resources, no less than sixty (60) days prior to the end of each calendar
year, a good faith estimate of the amount of the Tax Benefits that will be
payable to Resources during the immediately following year. Buyer, Xxxxxxx
and Xxxxxxx Subs shall in good faith revise and update or cause to be
revised and updated each such estimate on a quarterly basis, to be
delivered to Resources no less than fifteen (15) days prior to the end of
each quarter.
8.6 Lump Sum Tax Benefit Amount. Buyer, Xxxxxxx and other members of
the Buyer Group shall, on the Lump Sum Payment Date, pay Resources the
present value of 90% of all the Tax Benefits with respect to all Taxable
Periods ending after the Lump Sum Record Date (the "Lump Sum Tax Benefit
Amount"). The Lump Sum Tax Benefit Amount shall be calculated by projecting
future Tax Benefits (which shall take into account adjustments to the Tax
Benefit Base Amount as a result of the payment of the Lump Sum Tax Benefit
Amount) using all relevant data, business plans, engineering and geological
studies, tax rates and other provisions of the tax law in effect (and
giving effect to any changes thereto for the Taxable Periods such changes
are scheduled to become effective) and by assuming that each of Buyer,
Xxxxxxx and other members of the Buyer Group have income or gain in all
relevant Taxable Periods in excess of all available depreciation,
amortization, losses and other deductions, thereby maximizing the Tax
Benefits for each such Taxable Period. In determining the present value of
the future projected Tax Benefits amount, (i) the projected Tax Benefits
for all Taxable Periods ending on or before the fourth anniversary of the
Lump Sum Record Date shall be discounted using the short-term applicable
federal rate (compounding annually) effective on the Lump Sum Payment Date
as published by the Internal Revenue Service under Section 1274(d) of the
Code, (ii) the projected Tax Benefits for all Taxable Periods ending after
the fourth anniversary and on or before the tenth anniversary of the Lump
Sum Record Date shall be discounted using the mid-term applicable federal
rate (compounding annually) effective on the Lump Sum Payment Date as
published by the Internal Revenue Service under Section 1274(d) of the
Code, and (iii) the projected Tax Benefits for all Taxable Periods ending
after the tenth anniversary of the Lump Sum Record Date shall be discounted
using the long-term applicable federal rate (compounding annually)
effective on the Lump Sum Payment Date as published by the Internal Revenue
Service under Section 1274(d) of the Code. For purposes of computing the
discounted Tax Benefits for each Taxable Period, such Tax Benefits shall be
assumed to be earned ratably throughout the year and shall be discounted to
the Lump Sum Payment Date. Buyer, Xxxxxxx and Xxxxxxx Subs' payment of the
Lump Sum Tax Benefit Amount pursuant to this Section 8.6 shall relieve the
obligation of Buyer, Xxxxxxx and other members of the Buyer Group to make
Tax Benefit payments with respect to Taxable Periods ending after the Lump
Sum Record Date under Sections 8.1 and 8.2 hereof but shall not affect any
other aspect of this Agreement.
9. Matters Arising After the Closing Date.
9.1 Cooperation. Buyer, Xxxxxxx and any affected member of the Buyer
Group shall consult in good faith and provide Resources and Alliant Energy
with such assistance as reasonably may be requested in writing by any of
them in connection with (i) the preparation and execution of any Return,
(ii) the determination of the Tax Benefit Base Amount, the Notional Tax
Liability, the Actual Tax Liability, the estimate of the amount of the Tax
Benefits and any adjustment thereof, the Prepayment Amount and the Lump Sum
Tax Benefit Amount
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(iii) the negotiation and settlement of any audit or other examination of any
Return by any Tax Authority, or (iv) the handling of any judicial or
administrative proceeding relating to any Tax liability or taxable periods of
Xxxxxxx or Xxxxxxx Subs ending on, prior to, or including the Closing Date,
including without limitation to (i) notify Resources and Alliant Energy of any
Tax Authority's initiating an audit, requesting information or proposing
adjustment, or any extension of statutes of limitation and of final
determinations of adjustment, (ii) preserve records, documents and other
information relevant to liabilities for Taxes until the expiration of the
applicable statute of limitations or extensions thereof and to provide, upon
written request, copies of such records and/or reasonable access thereto, (iii)
make available without charge at a location determined by Buyer, Xxxxxxx or
Xxxxxxx Subs during normal working hours, upon written request, personnel
responsible for preparing, maintaining, or explaining information, records and
documents in connection with matters relating to Taxes, and (iv) execute and
deliver such powers of attorney, consents and other documents as are necessary
to carry out the intent of this Agreement.
9.2 Discretion to Contest, Negotiate and Settle. Alliant Energy shall
have sole and exclusive discretion to contest or not to contest, negotiate and
settle proposed adjustments relating to the inclusion in any Consolidated Return
of the income, gain, expense, loss, deduction, credit, related carryovers or
carrybacks, or other tax items of Xxxxxxx and Xxxxxxx Subs for any period ending
on, prior to, or including the Closing Date. Buyer shall have sole and exclusive
discretion to contest or not to contest, negotiate and settle proposed
adjustments relating to the inclusion in all other Returns of the income, gain,
expense, loss, deduction, credit, related carryovers or carrybacks, or other tax
items of Xxxxxxx and Xxxxxxx Subs, except as set forth in Section 9.3 hereof.
9.3 Disputed Tax Benefits.
9.3.1 Control of Proceedings. In the event that an audit of Buyer,
Xxxxxxx or any other affected member of the Buyer Group by the Internal Revenue
Service or other Tax Authority may have an effect on the existence or amount of
the Tax Benefits, the Prepayment Amount or the Lump Sum Tax Benefit Amount (a
"Tax Benefit Issue"), Buyer, Xxxxxxx and any other affected member of the Buyer
Group shall contest the matter on audit, through Internal Revenue Service or
other administrative proceedings and through judicial proceedings.
Representatives of Alliant Energy or Resources shall be allowed to participate
in such proceedings in so far as they relate to the Tax Benefit Issue and such
participation shall be reflected by the grant of appropriate powers of attorney.
Decisions regarding the conduct of a contest shall be made by Alliant Energy or
Resources or its representatives after consultation with Buyer and its
representatives; provided, however, that ultimate control over contesting the
Tax Benefit Issue, including control over procedural matters that necessarily
relate to all issues being contested (including, without limitation, choice of
forum), shall be exercised in good faith by Alliant Energy or Resources and its
representatives and Buyer, Xxxxxxx and any other affected member of the Buyer
Group shall take any action as is necessary to effectuate the decisions of
Alliant Energy or Resources; provided, further, however, that decisions relating
solely to tax issues unrelated to the Tax Benefit Issue shall be made as set
forth in Section 9.2 hereof. Decisions regarding the settlement of a contest of
the Tax Benefit Issue shall be made in good faith jointly by Alliant Energy (and
Resources) and Buyer (and Xxxxxxx and Xxxxxxx Subs) and their representatives;
provided, however, that if Alliant Energy (or Resources) or Buyer (or
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Xxxxxxx or Xxxxxxx Subs) decline a settlement proposal relating to the Tax
Benefit Issue that the other wishes to accept, the contest will continue and the
declining party will (i) bear all further contest costs, (ii) indemnify the
party wishing to accept the settlement against any outcome more adverse than
that of the proposed settlement and (iii) be entitled to all benefits more
advantageous than those of the proposed settlement.
9.3.2 Outcome of Contest and Repayment.
A. Adverse Outcome. If, as the result of a contest described in
Section 9.3.1 hereof, the Tax Benefits, the Prepayment Amount or the Lump Sum
Tax Benefit Amount is less than that taken into account in computing any
payments made under Section 8 hereof, such payments shall be recomputed on the
basis of such revised Tax Benefits, the Prepayment Amount or the Lump Sum Tax
Benefit Amount and any excess payments shall be paid by Resources to Buyer,
Xxxxxxx or any other member of the Buyer Group, within ten (10) days after such
contest is over. Resources shall also pay to Buyer, Xxxxxxx or any other member
of the Buyer Group interest at the rates required to be paid by Buyer, Xxxxxxx
or such other member of the Buyer Group under Section 6621 of the Code (the
"Underpayment Rate") with respect to the revision of the amount of Tax Benefits,
the Prepayment Amount or the Lump Sum Tax Benefit Amount or at the corresponding
state, local or foreign underpayment interest rates in connection with revisions
relating to the state, local or foreign tax revisions also within ten (10) days
after the contest is over.
B. Favorable Outcome. If, as the result of a contest described in
Section 9.3.1 hereof, Tax Benefits, the Prepayment Amount or the Lump Sum Tax
Benefit Amount is more than that taken into account in computing any payments
made under Section 8 hereof, such payments shall be recomputed on the basis of
such revised Tax Benefits, the Prepayment Amount or the Lump Sum Tax Benefit
Amount and any deficit in payment amounts shall be paid by Buyer, Xxxxxxx and
other members of the Buyer Group to Resources within ten (10) days after such
contest is over. Buyer, Xxxxxxx and other members of the Buyer Group shall also
pay to Resources interest at the rates Buyer, Xxxxxxx or other members of the
Buyer Group are entitled to under Section 6611 of the Code with respect to the
revision of the amount of Tax Benefits, the Prepayment Amount or the Lump Sum
Tax Benefit Amount or at the corresponding state, local or foreign overpayment
interest rates in connection with revisions relating to the state, local or
foreign tax revisions, also within ten (10) days after the contest is over.
9.3.3 Resolution of Computational Disputes. If the parties hereto
are unable to agree on the amount of Tax Benefits, the Prepayment Amount or the
Lump Sum Tax Benefit Amount (the "Disputed Amount") as determined under Sections
1.38, 8.1, 8.2, 8.3, 8.4 and 8.6 hereof, the determination of such Disputed
Amount shall be made by an independent firm of certified public accountants
jointly selected by Alliant Energy and Buyer. If Alliant Energy and Buyer cannot
agree on the selection of an independent firm of certified public accountants,
such firm will be jointly selected by the firms of certified public accountants
that certify (or selected by the firm of certified public accountants that
certifies) the financial statements of Alliant Energy and Buyer and such firm
cannot be one of the selecting firm(s). Such accountants shall be given access
by Alliant Energy, Buyer and their respective subsidiaries to all information
necessary to determine the Disputed Amount, subject to the agreement of such
accountants that
14
such information shall be kept confidential and shall not be released without
the written consent of Alliant Energy or Buyer, as appropriate, except as
compelled by legal process. Any amount otherwise due under this Agreement that
is a Disputed Amount shall be paid, together with interest at the Underpayment
Rate from the date on which such payment was originally due, within ten (10)
days of the determination of such Disputed Amount. Judgment upon the Disputed
Amount as determined by the accountants may be entered in any court having
jurisdiction over the matter. Each of Alliant Energy and Buyer (and their
subsidiaries) shall pay its own costs and expenses incurred in determining the
Disputed Amount. Resources and Buyer shall share equally the costs of the
independent firm of certified public accountants selected to determine the
Disputed Amount.
9.3.4 Expenses. Unless otherwise provided in the Agreement, fees and
expenses paid to third-party service providers and incurred after the date
hereof by Alliant Energy, Resources, Buyer or any of their subsidiaries for the
purpose of resolving any dispute relating to the Tax Benefits, the Prepayment
Amount or the Lump Sum Tax Benefit Amount including, without limitation, legal
and accounting expenses relating to the resolution of any dispute with any Tax
Authority regarding a Tax Benefit Issue or any related activity, shall be borne
by Resources in the lesser of the following percentages (i) 90% or (ii) the Tax
Benefits, the Prepayment Amount or the Lump Sum Tax Benefit Amount in
controversy relating to a Tax Benefit Issue divided by the total Tax in
controversy relating to such Tax Benefit Issue. All other such fees and expenses
shall be borne by Buyer. Notwithstanding the above, the obligation of Resources
to bear any portion of such fees or expenses related to service providers not
retained by it shall be contingent upon Alliant Energy's and Resources' prior
written approval of the retention of any such service providers.
10. Capital Contribution. Xxxxxxx shall deliver to Alliant Energy a
schedule setting forth the minimum required amount of federal, state and local
income taxes and Federal Insurance Contributions Act taxes Xxxxxxx is required
to withhold from its employees on the payments made to them pursuant to that
certain Xxxxxxx Petroleum Corporation Phantom Equity Plan at least ten (10) days
prior to the date such taxes are required to be withheld, together with all
supporting documentation. Such schedule shall be subject to the review, approval
and adjustment by Alliant Energy; provided, however, that any such adjustments
shall be mutually agreed to by Buyer or Xxxxxxx, on the one hand, and Alliant
Energy, on the other. If the parties are unable to mutually agree on the amount
of the minimum required tax withholding within five (5) business days following
delivery of such schedule, then the resolution procedure set forth in Section
5.2 hereof shall be used to resolve such dispute. Resources shall pay (as a
capital contribution), on behalf of Xxxxxxx, such amount of the minimum
required tax withholding to Xxxxxxx'x outside payroll processor on the date the
withholding tax is required to be remitted to the appropriate taxing authority;
provided however, that any portion of such amount that is still the subject of a
dispute (and only to the extent of such portion) does not have to be paid at
such time. Any remaining amount, as finally determined, shall be paid by
Resources to Xxxxxxx'x outside payroll processor within three (3) business days
after such amount is finally determined. Buyer and Xxxxxxx shall cause such
payroll processor to timely remit all amounts paid by Resources under this
Section 10 to the appropriate tax authorities.
11. Attorney's Fees. Should suit be brought to enforce or interpret any
part of the Agreement, the prevailing party will be entitled to recover, as an
element of the costs of suit and not as damages, reasonable attorneys' fees
actually incurred by such prevailing party (including, without limitation,
costs, expenses and fees on any appeal). The prevailing party will be entitled
to recover its costs of suit, regardless of whether such suit proceeds to final
judgment.
12. Notice of Change of Control. Buyer shall notify Alliant Energy and
Resources in writing of any Change of Control within thirty (30) days of the
occurrence of such Change of Control and shall promptly provide Resources with
all information in Buyer's possession relating to such Change of Control as
Alliant Energy or Resources may reasonably request. Notwithstanding any other
provision of this Agreement, Alliant Energy and Resources may elect, by
delivering written notice to Buyer within ninety (90) days after its receipt of
the aforementioned notice from Buyer, to have such Change of Control not deemed
a "Change of Control" for purposes of this Agreement. Alliant Energy and
Resources shall have the right to make such an election with respect to any
Change of Control.
13. Construction. Each of the parties further agrees that notwithstanding
anything to the contrary contained herein, the provisions of this Agreement in
all events shall be interpreted and applied in a manner consistent with the
following principle: Alliant Energy or Resources shall be compensated for 90% of
any tax savings arising from (i) the increase in basis of the assets of Xxxxxxx
and Xxxxxxx Subs due to the Section 338(h)(10) Election and (ii) the payments
made pursuant to this Agreement.
15
14. Notices. Any notice required under any provisions of this Agreement
shall be made in the manner provided in the section entitled "Notices" in the
Master Separation Agreement. Delivery of notice to Buyer shall be deemed to be
delivery of notice to Xxxxxxx and Xxxxxxx Subs.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the law of the state of Wisconsin applicable to contracts made
and to be performed therein, without effect to its choice of law.
16. Binding Effect; Successors. This Agreement shall be binding upon and
inure to the benefit of any successor, by merger, acquisition of assets or
otherwise, to any of the parties hereto (including but not limited to any
successor of Alliant Energy, Resources, Buyer, Xxxxxxx or Xxxxxxx Subs
succeeding to the tax attributes of Alliant Energy, Resources, Buyer, Xxxxxxx or
Xxxxxxx Subs under Section 381 of the Code), to the same extent as if such
successor had been an original party to the Agreement. In addition, Buyer shall
cause any and all members of the Buyer Group to be bound by the Agreement to the
extent necessary to implement the Agreement. Moreover, in the event of any
acquisition of the assets of Xxxxxxx or Xxxxxxx Subs in which gain or loss is
not recognized, in whole or in part, for federal income tax purposes, Buyer,
Xxxxxxx and Xxxxxxx Subs shall ensure that any purchaser of such assets shall
assume the obligation set forth in this Agreement.
17. Severability. In the event that any term or provision of this Agreement
shall for any reason be held invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other term
or provision, to the extent the same shall have been held to be invalid, illegal
or unenforceable, had never been contained herein.
18. Headings. The headings in the sections of this Agreement are inserted
for convenience of reference only and shall not constitute a part hereof.
19. Waivers. No waiver of any breach or default hereunder shall be
considered valid unless in writing and signed by the party giving such waiver,
and no such waiver shall be deemed a waiver of any subsequent breach or default
of the same or similar nature.
20. Rules of Construction. Each of the parties hereto agrees that (a) the
normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation
or construction of this Agreement, and (b) no usage of trade, course of dealing,
course of performance or enforcement or surrounding circumstances shall be used
in interpreting or construing this Agreement.
21. Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
22. Entire Agreement. This Agreement, together with the Tax Allocation
Agreement, the Registration Rights Agreement and the Master Separation
Agreement, constitutes the entire agreement of the parties with respect to the
subject matter hereof, supersedes all prior agreements and understandings
between them, and may not be modified, amended or terminated except by a written
agreement signed by all of the parties hereto. In the
16
event there is a conflict between this Agreement and the Tax Allocation
Agreement, this Agreement shall control. In the event both this Agreement and
the Tax Allocation Agreement provide for a payment or reimbursement of the same
Tax, this Agreement shall control.
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
ALLIANT ENERGY CORPORATION
By:______________________________
Name:____________________________
Title:___________________________
ALLIANT ENERGY RESOURCES, INC.
By:______________________________
Name:____________________________
Title:___________________________
XXXXXXX PETROLEUM CORPORATION
By:______________________________
Name:____________________________
Title:___________________________
XXXXXXX OIL AND GAS CORPORATION
By:______________________________
Name:____________________________
Title:___________________________
XXXXXXX-XXXXXX GAS CORPORATION
By:______________________________
Name:____________________________
Title:___________________________
XXXXXXX PROGRAMS, INC.
By:______________________________
Name:____________________________
Title:___________________________
WOK ACQUISITION COMPANY
By:______________________________
Name:____________________________
Title:___________________________
18
