Correlative Adjustment definition

Correlative Adjustment means, in the case of an Adjustment comprising either a Restructuring Adjustment or Non-Line of Business Adjustment, the net present value of any future increases or decreases in a Tax that would be realized, using the assumptions set forth in the next sentence, by either AT&T or any other member of the AT&T Services Group, Lucent or any other member of the Lucent Group or NCR or any other member of the NCR Group, as the case may be, in one or more Taxable periods (or any portion of a Taxable period) but only if such increases or decreases (a) will take effect or begin to take effect in the Taxable period or portion of a Taxable period immediately following the Taxable period or portion of a Taxable period in which the Restructuring Adjustment or Non-Line of Business Adjustment to such Tax was made; and (b) are a direct result of such an Adjustment to that Tax in the immediately preceding Taxable period or portion of such Taxable period. For purposes of determining the net present value of any such future increases or decreases in a Tax, the following assumptions will be used: (i) a discount rate equal to the sum of the Prime Rate as of the date of the Final Determination relating to such Restructuring Adjustment or Non-Line of Business Adjustment plus 3.5%; (ii) in the case of any income Tax, the highest marginal Tax rate or, in the case of any other Tax, the highest applicable Tax rate, in each case in effect with respect to that Tax for the Taxable period, or portion of the Taxable period, in which the Restructuring Adjustment or Non-Line of Business Adjustment was made; (iii) the depreciation, amortization or credit rate or lives, if applicable, in effect for the Taxable period, or portion of the Taxable period, in which the Restructuring Adjustment or Non- Line of Business Adjustment was made; and (iv) such determination shall be made without regard to whether any actual increases or decreases in such Tax will in fact be realized with respect to the future Returns to which such Correlative Adjustment relates.

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Correlative Adjustment means a disallowance of an item of deduction, loss or credit (or an increase of an item of income or gain) that is related or attributable to the Assets of a Party or that Party’s Affiliates, that is included in a Tax Return for a Pre-Distribution Tax Period or the portion of a Straddle Tax Period ending on the Distribution Date, and that results in a correlative increase of an item of deduction, loss or credit (or reduction of an item of income or gain) with respect to another Party or that Party’s Affiliates with respect to such period or periods.

Correlative Adjustment means a tax benefit such as an increase in the amount of tax basis of an asset, exclusion from income, tax credit or other adjustment that results (directly or indirectly) from a tax detriment arising in any Seagate taxable year ending prior to the taxable year in which the Closing occurs, such as an increase in taxable income or gain, reduction in the amount of a tax credit or the tax basis of an asset, to the extent arising from a settlement with, a taxing authority, a final determination (as described in Section 1313(a) of the Code), or the filing of an amended Tax Return, in each case, subsequent to the Closing.

Examples of Correlative Adjustment in a sentence

If pursuant to a Final Determination there is a Correlative Adjustment attributable to a Pre-Distribution Non-Income or Non-U.S. Tax Audit that causes a Party or its Affiliate to become entitled to a tax benefit, such Party shall pay the amount of the Tax Benefit Actually Realized in respect to the taxable years included in the Final Determination to the Party that experiences (or whose Affiliate experiences) a tax detriment as a result of such Correlative Adjustment.
If a Pre-Distribution U.S. Income Tax Audit results in a Final Determination that causes a Correlative Adjustment to one Party (or its Subsidiary) and a corresponding Tax Benefit to the other Party (or its Subsidiary), such other Party shall pay the amount of the Tax Benefit to the first Party.
If pursuant to a Final Determination there is a Correlative Adjustment attributable to a Pre-Distribution Non-Income or Non-U.S. Tax Audit that causes a Party or its Affiliate to become entitled to a tax benefit, such Party shall pay the amount of the Tax Benefit Actually Realized in the taxable year of the Final Determination to the Party that experiences (or whose Affiliate experiences) a tax detriment as a result of such Correlative Adjustment.
If pursuant to a Final Determination there is a Correlative Adjustment attributable to a Pre-Distribution Non-Income or Non-U.S. Tax Audit that causes a Party or its Affiliate to become entitled to a tax benefit, such Party shall pay to the Party that experiences, or whose Affiliates experience, a tax detriment in an amount equal to the lesser of (a) the Tax Benefit Actually Realized or (b) the amount of the tax detriment as a result of such Correlative Adjustment.
If an Audit described in Section 9.2(a)(i) results in a Final Determination that causes a Correlative Adjustment to one Party (or its Subsidiary) and a corresponding Tax Benefit to the other Party (or its Subsidiary), such other Party shall pay, without duplication of any other amounts payable under this Agreement, the amount of the Tax Benefit to the first Party.
APA Primary & Correlative Adjustment Example ▪ US parent manufactures tangible goods, and its Japanese subsidiary supplies raw materials.

More Definitions of Correlative Adjustment

Correlative Adjustment means a disallowance of an item of deduction, loss or credit (or an increase of an item of income or gain) attributable to a Party or that Party’s Subsidiaries, that is included in a Tax Return for a Pre-Distribution Tax Period or the portion of a Straddle Tax Period ending on the Distribution Date, and that directly results in a correlative increase of an item of deduction, loss or credit (or reduction of an item of income or gain) with respect to another Party or that Party’s Subsidiaries with respect to a Tax Return for a Pre-Distribution Tax Period or a Straddle Tax Period.

Correlative Adjustment means, in the case of an Adjustment, the net present value of any future increases or decreases in a Tax that would be realized, using the assumptions set forth in the next sentence, by any member of the Health Care Systems Group, the Instruments Group, or the Semiconductor Equipment Group, as the case may be, in one or more Tax Periods (or any portion of a Tax Period) but only if such increases or decreases are a direct result of such an Adjustment to that Tax. For purposes of determining the net present value of any such future increases or decreases in a Tax, the following assumptions will be used: (i) a discount rate equal to the sum of the Prime Rate as of the date of the recomputation of Tax or the Final Determination relating to such Adjustment plus 2.0%; (ii) in the case of any Income Tax, the highest marginal Tax rate, or, in the case of any other Tax, the highest applicable Tax rate, in each case in effect with respect to that Tax for the Tax Period, or portion of the Tax Period, in which the Adjustment was made; (iii) the depreciation, amortization or credit rate or lives, if applicable, in effect for the Tax Period, or portion of the Tax Period, in which the Adjustment was made; and (iv) such determination shall be made without regard to whether any actual increases or decreases in such Tax will in fact be realized with respect to the future Tax Returns to which such Correlative Adjustment relates.

Correlative Adjustment means, in the case of an Adjustment comprising a Non-Line of Business Adjustment, the net present value of any future increases or decreases in a Tax that would be realized, using the assumptions set forth in the next sentence, by either Intelligroup or any other member of the Intelligroup Group or SeraNova or any other member of the SeraNova Group, as the case may be, in one or more Taxable periods (or any portion of a Taxable period) but only if such increases or decreases (a) are a direct result of the Non-Line of Business Adjustment and (b) will take effect or begin to take effect in the Taxable period or portion of a Taxable period of or immediately following the Taxable period or portion of a Taxable period in which the Non-Line of Business Adjustment to such Tax is made. For purposes of determining the net present value of any such future increases or decreases in a tax, the following assumptions will be used: (i) a discount rate equal to the sum of the Federal Short-Term Rate as of the date of the Final Determination relating to such Non-Line of Business Adjustment plus 3.5%; (ii) in the case of any income Tax, the highest marginal Tax rate or, in the case of any other Tax, the highest applicable Tax rate, in each case in effect with respect to that Tax for the Taxable period, or portion of the Taxable period, in which the Non-Line of Business Adjustment was made; (iii) the depreciation, amortization or credit rate or lives, if applicable, in effect for the Taxable period, or portion of the Taxable period, in which the Non-Line of Business Adjustment was made; and (iv) such determination shall be made without regard to whether any actual increases or decreases in such Tax will in fact be realized with respect to the future Returns to which such Correlative Adjustment relates.