Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Membership Interest Purchase Agreement (Steel Dynamics Inc), Membership Interest Purchase Agreement (Ak Steel Holding Corp)
Contests. Whenever (a) After the Closing Date, the Acquirors shall promptly notify THCI in writing of the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding or of any demand or claim on the Acquirors or any of their respective Affiliates which, makes an assessmentif determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification under Section 7.06. Such notice shall contain factual information (to the extent known to the Acquirors or otherwise disputes the amount relevant Affiliate) describing the asserted Tax liability in reasonable detail and shall include copies of Taxes for which Seller may reasonably be expected any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If the Acquirors fail to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of give THCI prompt notice of such an asserted Tax Claim, promptly inform Seller in writing; provided, however, that liability as required by this Section 7.07 and if THCI is precluded by the failure to give such prompt notice as provided herein from contesting the asserted Tax liability in both the administrative and judicial forums, then THCI shall not relieve Seller have any obligation to indemnify for any loss arising out of its obligations under this Article V except such asserted Tax liability to the extent that Seller is materially THCI was prejudiced thereby. Seller shall have the right to as a result of such failure.
(b) THCI may elect to control the defense direct, through counsel of its own choosing and at its own expense, any Tax Claim audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought under Section 7.06 relating to any taxable periods period ending on or before the Closing DateDate (any such audit, claim for refund or otherwise proceeding relating to Taxes for which Seller may be liable under this Agreement (other than with respect an asserted Tax liability is referred to herein as a Straddle Period"CONTEST"). If THCI elects to direct a Contest, at its sole cost and expense by written notice to Purchaser it shall within ten (10) 30 calendar days of receipt of the notice thereof; providedof asserted Tax liability notify the Acquirors in writing of its intent to do so, however, that Purchaser mayand the Acquirors shall cooperate and shall cause their respective Affiliates or their respective successors to cooperate, at its sole cost and THCI's expense, retain separate counsel of its choosing to participate in the defense or settlement each phase of such Contest. In each such case, neither the Acquirors nor any of their respective Affiliates may settle or compromise any asserted Tax Claim by Sellerliability over the objection of THCI. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller THCI elects not to control direct the defense Contest or thereafter fails or ceases to defend any such Tax Claimnotify the Acquiror of its election as herein provided, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company Acquirors or any of its Subsidiaries; providedtheir respective Affiliates may contest, howeverat their own expense, that, in the case of a such asserted Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in liability or pay or compromise such proceeding (asserted Tax liability at its sole cost and THCI's expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Asset Purchase Agreement (Westfield America Inc), Asset Purchase Agreement (Rouse Company)
Contests. Whenever In the event Purchaser or Sellers receives written notice of any Taxing Authority asserts a examination, claim, makes an assessmentsettlement, proposed adjustment, administrative or judicial proceeding, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement other matter (a “"Tax Claim”)") related to any Pre-Closing Taxes, Transfer Taxes or Overlap Period Taxes, Purchaser or Sellers, as the case may be, shall upon notify the other Parties in writing as soon as reasonably practical (but in no event more than ten (10) Business Days) after receipt of such notice. If Sellers notify Purchaser in writing within thirty (30) Business Days following receipt of such written notice they intend to exercise their rights pursuant to this Section 8.7, they shall be entitled to control the defense, prosecution, settlement or compromise of such Tax Claim, promptly inform Seller at their own expense. Purchaser shall take such action in writing; provided, however, that failure to give contesting such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating as Sellers shall reasonably request from time to taxable periods ending on or before time, including the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement selection of counsel and experts and execution of powers of attorney. Purchaser shall (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10a) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement not make any payments of such Tax Claim for at least thirty (30) days (or such shorter period as may be required by Sellerapplicable Law) after giving the notice required by this Section 8.7, (b) give the Sellers any information requested relating to such Tax Claim, (c) give any Tax Authority any information requested by Sellers relating to such Tax Claim, and (d) otherwise cooperate with and make internal resources available to the Sellers in good faith in order to effectively contest any such Tax Claim. If Seller timely elects Sellers shall reimburse Purchaser for any reasonable, out-of-pocket costs pre-approved by Sellers and demonstrated to control the defense of Sellers' reasonable satisfaction that are incurred by Purchaser in providing such assistance. Purchaser shall not settle or otherwise compromise any such Tax Claim with any Taxing Authority or prosecute such contest to a determination in accordance court or other tribunal or initial or appellate jurisdiction unless instructed to do so by the Sellers. Any of the Sellers may settle or otherwise compromise any such Tax Claim without Purchaser's prior written consent, except that if as a result of such settlement or compromise the Taxes payable by Purchaser would be materially increased, none of Sellers may settle or compromise such matter without Purchaser's prior written consent, which consent shall not be unreasonably withheld. In connection with this Section 5.06any proceeding taken with respect to such matters, (i) Seller Sellers shall keep Purchaser reasonably apprised informed of the status of the Tax Claim all material developments and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto events relating to such matters if involving a material liability for Taxes and (ii) Purchaser shall have the right to consentright, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in any such proceeding (at its sole cost proceedings. Purchaser shall cooperate with Sellers by giving them and expense) their representatives, on prior reasonable notice, reasonable access and cooperation during normal business hours to the extent such Tax Claim is related all information, books and records pertaining to the portion of such Straddle Period that is a Transfer Taxes, Pre-Closing Tax PeriodTaxes and Overlap Period Taxes. Sellers shall reimburse Purchaser for any reasonable, out-of-pocket costs pre-approved by Sellers and demonstrated to Sellers' reasonable satisfaction that are incurred by Purchaser shall not settle in providing such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementassistance.
Appears in 2 contracts
Sources: Purchase Agreement (Pinnacle West Capital Corp), Purchase Agreement (Sierra Pacific Resources /Nv/)
Contests. Whenever (a) After the Closing, the Purchaser shall -------- promptly notify the Shareholders in writing of the commencement of any Taxing Tax audit or administrative or judicial proceeding or of any demand or claim on the Purchaser, the Company or any Company Subsidiary which, if determined adversely to the taxpayer or after the lapse of time, is likely to give rise to grounds for indemnification by the Shareholders. Such notice shall contain factual information (to the extent known to the Purchaser) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority asserts in respect of any such asserted Tax liability. If the Purchaser fails to give the Shareholders prompt notice of an asserted Tax liability, then (i) if the Shareholders are precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, the Shareholders shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (ii) if the Shareholders are not so precluded from contesting, but such failure to give prompt notice results in a claimdetriment to the Shareholders, makes an assessment, or any amount which the Shareholders are otherwise disputes required to pay the Purchaser with respect to such liability shall be reduced by the amount of Taxes for which Seller may reasonably be expected to be liable under such detriment.
(b) Except as indicated in the last sentence of this Agreement (a “Tax Claim”Section 8.04(b), the Shareholders may elect to direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought from the Shareholders (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "Contest"). If the Shareholders elect to direct the Contest of an asserted Tax ------- liability, they shall, within 30 calendar days of receipt of the notice of asserted Tax liability, notify the Purchaser of their intent to do so, and the Purchaser shall upon receipt of notice cooperate and shall cause the Company and the Company Subsidiaries to cooperate, at the Shareholders' expense, in each phase of such Tax ClaimContest. If the Shareholders elect not to direct the Contest, promptly inform Seller fail to notify the Purchaser of their election as herein provided or contest their indemnification obligation, the Purchaser may pay, compromise or contest, at its own expense, such asserted liability. However, in writingsuch case, the Purchaser may not settle or compromise any asserted liability over the objection of the Shareholders; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to be -------- ------- unreasonably withheld. In any event, both the extent that Seller is materially prejudiced therebyPurchaser and the Shareholders may participate, at their own expense, in the Contest. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than If a Contest includes both an asserted liability with respect to a Straddle Period), at its sole cost which an indemnity may be sought from the Shareholders and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes an asserted liability for which Purchaser or its Affiliates no such indemnity may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claimsought, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser 8.04(b) shall have apply only to such portion of the right to control any proceedings relating to Taxes of or Contest as involves the asserted liability with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller an indemnity may be liable under this Agreementsought from the Shareholders.
Appears in 2 contracts
Sources: Registration Rights Agreement (Pogo Producing Co), Merger Agreement (Pogo Producing Co)
Contests. Whenever Purchaser shall promptly notify Seller in writing upon receipt by Purchaser or the Subject Company of notice of any Taxing Authority asserts a claimpending or threatened federal, makes an assessmentstate, local or otherwise disputes foreign income or franchise tax audits or assessments which may materially affect the amount tax liabilities of Taxes the Subject Company for which Seller may reasonably would be expected required to be liable under this Agreement (a “Tax Claim”indemnify Purchaser pursuant to Section 5.4(a), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the sole right to elect to control represent the defense of Subject Company's interests in any Tax Claim tax audit or administrative or court proceeding relating to taxable periods ending on or before the Closing Date, or otherwise relating and to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate employ counsel of its choosing choice at its own expense. Seller shall not be entitled to participate in settle, either administratively or after the defense commencement of litigation, any claim for Taxes that would materially adversely affect the liability for Taxes of Purchaser or settlement the Subject Company for any period after the Closing Date without the prior written consent of Purchaser; provided that such Tax Claim by Seller. If consent shall not be unreasonably withheld or delayed and shall not be necessary to the extent that Seller timely elects to control has indemnified Purchaser against the defense effect of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Datesettlement. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate participate, at its own expense, in such proceeding the defense of any claim for Taxes for a year or period that includes and ends after the Closing Date that may be the subject of indemnification by Seller pursuant to Section 5.4(a) and, with the written consent of Purchaser (which shall not be unreasonably withheld or delayed), and at its sole cost and expense) , may assume the entire defense of such tax claim. Neither Purchaser nor the Subject Company may agree to the extent such settle any Tax Claim is related to claim for the portion of such Straddle Period that is a Pre-the year or period ending prior to or on the Closing Tax Period, and Purchaser shall not settle such portion Date which may be the subject of such Tax Claim indemnification by Seller under Section 5.4(a) without the prior written consent of Seller’s consent, which ; provided that such consent may shall not be unreasonably withheld, conditioned withheld or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Lady Luck Gaming Corp), Stock Purchase Agreement (Sodak Gaming Inc)
Contests. Whenever Buyer shall promptly notify the Sellers' Representatives in writing of any Taxing written request by a Governmental Authority asserts to audit MEI or PPC (and their successors), and any written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding involving MEI or PPC (and their successors), makes an assessmentas the case may be, or otherwise disputes which, if determined adversely to the amount of Taxes taxpayer, would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingSection 12; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect Buyer's right to indemnification hereunder, except to the extent extent, if any, that, but for such failure, the Selling Shareholders or GCM, as the case may be, could have timely contested the Tax liability in question. In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller relates to any Pre-Closing Period other than the Interim Period, the Common Stock Selling Shareholders, with respect to MEI, or GCM or his designee, with respect to PPC, shall have the right to elect at the Selling Shareholders' or GCM's expense (as the case may be) to control the defense conduct of any Tax Claim relating to taxable periods ending on such audit or before proceeding, provided that within 60 days after such Person receives the Closing Date, or otherwise relating to Taxes for which Seller may be liable written notice from Buyer required under this Agreement (other than Section 12 and prior to taking any such action with respect to such audit or administrative or judicial proceeding, the Common Stock Selling Shareholders or GCM acknowledge in writing that they have the indemnification obligation under this Section 12 to indemnify Buyer and MEI and PPC, as the case may be, against the full amount of any adjustment that may be made as a Straddle result of such audit or proceeding. Notwithstanding the foregoing, neither the Common Stock Selling Shareholders nor GCM shall settle or otherwise compromise any issue or matter without the Buyer's prior written consent (which consent shall not be unreasonably withheld) if such issue or matter will have a material effect on the liability for Taxes of the Buyer or MEI and PPC, as the case may be, for a post-Closing taxable year or period (or for an Interim Period), . Buyer also may participate in any such audit or proceeding at its sole cost and own expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; providedand, howeverif the Common Stock Selling Shareholders or GCM, that Purchaser mayas the case may be, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control do not assume the defense of any such Tax Claim in accordance with audit or proceeding, Buyer may, without any effect to its or MEI's or PPC's, right to indemnification under this Section 5.0612, (i) Seller shall keep Purchaser reasonably apprised of defend the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser same in such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding with respect thereto and (ii) Purchaser shall have the right to Common Stock Selling Shareholders' or GCM's consent, as applicable, which consent may shall not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Purchase Agreement (Pantry Inc), Purchase Agreement (Pantry Inc)
Contests. Whenever (a) Buyer Parties and the Companies shall promptly forward to Stockholder Representative all written notifications and other communications from any Taxing Authority asserts relating to any Tax liability of the Companies with respect to a claimPre-Closing Tax Period or any actions with respect to the same. The failure of Buyer Parties or the Companies to deliver such written notice in such period shall not affect the rights of an Indemnified Party under Article 7 with respect to any Tax or Damage directly or indirectly related to the subject matter of such written notification or other communication except to the extent that the Indemnifying Party is materially and irrevocably prejudiced by the failure to provide such written notice.
(b) (i) Stockholder Representative (at Stockholders’ expense, makes an assessmentwhich shall be paid solely from the Stockholder Representative Expense Amount first and then from the Indemnification Escrow Account without regard to the Deductible) shall control any audit or examination by any taxing authority or any other judicial or administrative proceeding with respect to Taxes, and contest, resolve and defend against any assessment for additional Taxes, notice of Tax deficiency or otherwise disputes the amount other adjustment of Taxes for which Seller may reasonably be expected to be liable under this Agreement of the Companies (each, a “Tax ClaimMatter”), Purchaser shall upon receipt of notice of ) for any Pre-Closing Tax Period (but for this purpose excluding any Straddle Period) but only to the extent the Stockholders have an obligation with respect to any such Tax ClaimMatter under Article 7, promptly inform Seller in writingincluding through recovery against the Indemnification Escrow Account, which has not expired or lapsed; provided, however, that failure Stockholder Representative shall provide to give such notice as provided herein Buyer Parties (at Buyer Parties’ expense, which expense shall not relieve Seller be subject to indemnification under Article 7) reasonable participation rights with respect to so much of its obligations under this Article V except such Tax Matter that is reasonably likely to affect the extent that Seller is materially prejudiced therebyTax liability of Buyer Parties or the Companies for any Post-Closing Tax Period. Seller Stockholder Representative shall have the right to elect to control the defense of not assert any Tax Claim relating to taxable periods ending on defenses or before the Closing Dateclaims, enter into any settlement of, or otherwise relating compromise, any such Tax Matter that reasonably could adversely affect the liability of Buyer Parties or the Companies for any Taxes, as to Taxes for which Seller may the Stockholders would not be liable under this Agreement hereunder, without the prior written consent of Parent, which consent shall not be unreasonably withheld, delayed or conditioned. If Buyer Parties object to any action that Stockholder Representative proposes to take pursuant to the preceding sentence, Buyer Parties shall, within thirty (other than with respect to a Straddle Period), at its sole cost and expense by 30) days after delivery from Stockholder Representative of written notice of the intent to Purchaser take such action, notify Stockholder Representative in writing that it so objects, specifying with particularity the objectionable action and stating the specific factual or legal basis for any such objection. If a notice of objection shall be duly delivered, Buyer Parties and Stockholder Representative shall negotiate in good faith and use their commercially reasonable efforts to resolve such items. If Buyer Parties and Stockholder Representative are unable to reach such agreement within ten (10) days after receipt by Stockholder Representative of such notice, the disputed items shall be resolved by the Dispute Advisor and any determination by the Dispute Advisor shall be final. The Dispute Advisor shall resolve any disputed items within ten (10) days of receipt of notice thereof; providedhaving the item referred to it pursuant to such procedures as it may require. The costs, however, that Purchaser may, at its sole cost fees and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised expenses of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller Dispute Advisor shall be entitled to participate in such proceeding (at its sole cost borne equally by Buyer Parties and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementStockholder Representative.
Appears in 2 contracts
Sources: Merger Agreement (Vici Properties Inc.), Merger Agreement (Penn National Gaming Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (a) After the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Closing, Purchaser shall upon receipt promptly notify the Sellers Representative in writing of the proposed assessment or the commencement of any Tax audit or administrative or judicial proceeding or of any demand or claim on Purchaser, its Affiliates, or the Company or any Company Subsidiary which, if determined adversely to the taxpayer or after the lapse of time, could result in any Tax liability for the Sellers or be grounds for indemnification by the Sellers under ARTICLE IX. Such notice shall contain factual information (to the extent known to Purchaser, its Affiliates, or the Company) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If Purchaser fails to give the Sellers Representative prompt notice of an asserted Tax liability as required by this Section 7.03, then the Sellers shall not have any obligation to indemnify for any loss arising out of such asserted Tax Claimliability, promptly inform Seller in writing; provided, however, but only to the extent that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except results in a detriment to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement Sellers.
(other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10b) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in In the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such audit or administrative or judicial proceeding (at its sole cost and expensea “Contest”) that relates to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion have the sole right (at Seller’s expense) to control the conduct of such Tax Claim Contest. Purchaser shall notify Sellers Representative of any Contest, and shall keep Sellers Representative reasonably informed of the progress of such Contest, including by providing Sellers Representative copies of any material correspondence with the taxing authority. However, in such case, none of Purchaser or the Company may settle or compromise any asserted liability that Sellers may be obligated to indemnify without prior written consent of the Seller’s consentSellers Representative; provided, which however, that consent may to settlement or compromise shall not be unreasonably withheld.
(c) With respect to Straddle Periods, conditioned or delayedPurchaser shall direct and control, if such settlement would affect through counsel of its own choosing, any Contest involving any asserted Tax liability. If the amount of Taxes for asserted Tax liability is one with respect to which Seller indemnity may be liable under this Agreementsought from the Sellers pursuant to ARTICLE IX, the Sellers Representative may participate (at the Sellers’ expense) in such Contest, and neither Purchaser nor the Company may settle or compromise any asserted liability without the prior written consent of the Sellers Representative, which shall not be unreasonably withheld.
(d) Purchaser, the Sellers Representative and the Sellers agree to cooperate, and Purchaser agrees to cause the Company and the Company Subsidiaries to cooperate, in the defense against or compromise of any claim in any Contest.
Appears in 2 contracts
Sources: Stock Purchase Agreement (PAE Inc), Stock Purchase Agreement (PAE Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before a) After the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser Buyers shall notify Sellers in writing within ten (10) days of receipt receiving notice of a proposed assessment or the commencement of any Tax audit or administrative or judicial Proceeding or of any demand or claim on Buyers or the Cinemex Companies or Symphony, which, if determined adversely to such party or after the lapse of time, could have an adverse effect on Sellers. Such notice thereof; provided, however, that Purchaser may, at its sole cost shall contain factual information (to the extent known to Buyers and expense, retain separate counsel of its choosing to participate in the defense Cinemex Companies or settlement Symphony or any Related Person of such party) briefly describing the asserted Tax Claim by Seller. If Seller timely elects to control the defense liability and shall include copies of any notice or other document received from any Taxing Authority in respect of any such asserted Tax Claim in accordance with liability. The failure of Buyers to provide Sellers such notice shall not release Sellers from their obligations under this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement Agreement except to the extent Sellers have been materially prejudiced by the failure to receive such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. notice.
(b) Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatprovided below, in the case of a Tax Claim with respect audit or administrative or judicial Proceeding (a “Contest”) that relates to a Taxable Periods ending on or prior to the Closing Date or to any Straddle Period, Seller shall Period pursuant to which Contest Sellers could be liable for indemnification or could be entitled to a Tax refund from a Taxing Authority pursuant to this Agreement, Sellers shall have the right, at their expense, to participate in or, at the option of Buyers, control the conduct of such proceeding Contest; provided that, even if Buyers opt to permit Sellers to control the conduct of such Contest, Sellers (at its sole cost i) shall permit Buyers to participate in the Proceeding and expenseto monitor the progress of such Proceeding, and (ii) if such settlement or compromise would have an adverse effect on the Cinemex Companies, Symphony or Buyers, individually or in the aggregate, shall not settle or otherwise compromise such Proceeding without the prior written consent of Buyers (which consent shall not be unreasonably withheld, delayed or conditioned). Notwithstanding the foregoing, Sellers shall not have the right to control any Contest pursuant to which Sellers would reasonably be expected to be entitled to a Tax refund if the outcome of such contest could have an adverse effect on the Cinemex Companies, Symphony, or Buyers, individually or in the aggregate. In the case of a Contest that relates to the extent income tax returns of any of the Cinemex Companies or Symphony (an “Income Tax Contest”) that relates to Taxable Periods ending on or prior to the Closing Date, pursuant to which Contest Sellers could be liable for indemnification or could be entitled to a Tax refund from a Taxing Authority pursuant to this Agreement, Sellers shall have the right, at their expense, to control the conduct of such Income Tax Claim Contest, and, pursuant to Section 11.4, Buyers will cause Cinemex Companies to provide Sellers with reasonable assistance and access to the books and records of such Cinemex Company or Symphony as it relates to the Income Tax Contest, provided that Sellers (i) shall permit Buyers to participate in the Income Tax Contest and to monitor the progress of such Contest and (ii) if such settlement or compromise would have an adverse effect on the Cinemex Companies, Symphony or Buyers, individually or in the aggregate, shall not settle or otherwise compromise such Income Tax Contest without the prior written consent of Buyers (which consent shall not be unreasonably withheld, delayed or conditioned). Notwithstanding the foregoing, Sellers shall not be entitled to control any Contest if such Contest, alone or in conjunction with other Contests, could reasonably be expected to result in Losses that exceed the Tax Loss Cap. Any Tax adjustment (including restatement by inflation, surcharges, penalties and fines) assessed as a consequence of the conclusion of a Tax audit or administrative or judicial proceeding or of any demand or claim on Buyers or the Cinemex Companies corresponding to a taxable period that (A) ends on or before the Closing Date or (B) is related allocable to the portion of such Straddle Period that is a Pre-ending on and including the Closing Date, (x) shall be paid by Sellers to Buyers if the Tax Periodadjustment requires payment of additional Taxes, and Purchaser shall not settle such portion of such Tax Claim without subject to the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, limitations set forth in Section 8.5 as if such settlement would affect additional Taxes were Losses subject to indemnification under Section 8.4(i) and (y) shall be paid by or at the amount direction of Taxes for which Seller may be liable under this AgreementBuyers to Sellers if the Tax adjustment results in a credit or refund of Taxes.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Amc Entertainment Inc), Stock Purchase Agreement (Marquee Holdings Inc.)
Contests. Whenever (i) Buyer and Seller shall promptly notify the other Party in writing upon receipt of written notice of any Taxing Authority asserts a claimpending or threatened audit, makes an assessmentnotice of deficiency, examination, assessment or otherwise disputes any other administrative proceeding or court proceedings (“Audit”) which may affect any Tax liability for which the amount other Party is liable pursuant to this Section 5.12.
(ii) In the case of any Audit that relates solely to Taxes for which Seller may is liable under Section 5.12(a), Seller shall, at its option, have the sole right to (A) represent the interests of the Acquired Companies in such Audit; (B) employ counsel of its choice in connection therewith; and (C) settle such Audit; provided, however, if settlement or compromise of such Audit reasonably could be expected to adversely affect Buyer or the Acquired Companies, then Seller shall not settle or compromise any asserted Tax liability without the prior written consent of Buyer (such consent not to be liable under this Agreement unreasonably withheld, delayed or conditioned).
(a “iii) Buyer shall have the right to (A) control all other Audits, including all Audits involving any Post-Closing Tax Claim”Period (including any Straddle Period), Purchaser shall upon receipt ; (B) employ counsel of notice of its choice; and (C) settle such Tax Claim, promptly inform Seller in writingAudit; provided, however, that failure Buyer shall afford Seller the opportunity to give such notice participate, as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of may reasonably be requested by Seller, with Buyer in contesting any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) claim solely to the extent such Tax Claim is related claim relates to the portion of such Straddle Period Taxes that is would give rise to a Pre-Closing Tax Period, Seller indemnity obligation hereunder; and Purchaser shall provided further that Buyer may not settle such portion of such or compromise any asserted Tax Claim liability that would give rise to a Seller indemnity obligation hereunder without the Seller’s consent, which prior written consent may of Seller (such consent not to be unreasonably withheld, conditioned delayed or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementconditioned).
Appears in 2 contracts
Sources: Stock Purchase Agreement, Stock Purchase Agreement (API Technologies Corp.)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing of (i) the initiation of any Taxing Authority asserts audit or other examination by a claimtaxing authority of any Pre-Closing Period and (ii) any written notice of a proposed assessment or claim in an audit or administrative or judicial proceeding of the Purchaser or any member of the Target Group which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingArticle VII; provided, however, that the failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser’s right to indemnification under this Article V VII except to the extent extent, if any, that such failure to promptly provide notice materially affected the ability of the Seller is to successfully avoid or materially prejudiced thereby. reduce the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that relates to Pre-Closing Period, the Seller shall have the right at its expense to elect to participate in and control the defense conduct of any Tax Claim relating to taxable periods ending on such audit or before proceeding; the Closing Date, or otherwise relating to Taxes for which Seller Purchaser also may be liable under this Agreement (other than with respect to a Straddle Period)participate, at its sole cost and expense by written notice own expense, in any such audit or proceeding. If the settlement of such audit or proceeding could be reasonably expected to increase the Tax liability of the Purchaser or any of its Affiliates (including any member of the Target Group) in a Post-Closing Period, the Seller may not settle such audit or proceeding without the Purchaser’s consent, which shall not be unreasonably withheld or delayed, provided that the Purchaser’s consent shall not be required if the Purchaser fails to confirm in writing to the Seller its consent or decline to consent within ten (10) days Business Days of the Purchaser’s receipt of notice thereof; providedthe Seller’s request for such consent (and for the avoidance of doubt, howeverif the Seller fails to receive the Purchaser’s consent or decline to consent within ten (10) Business Days of the Purchaser’s receipt of the Seller’s request for consent, that the Purchaser may, at is deemed to have provided its sole cost and expense, retain separate counsel of its choosing consent to participate in the defense Seller to settle such audit or settlement of such Tax Claim by Sellerproceeding). If the Seller timely elects to does not assume the control the defense of any such Tax Claim in accordance with this Section 5.06audit or proceeding, (i) Seller shall keep the Purchaser reasonably apprised of may defend the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate same in such proceeding (at its sole cost and expense) manner as it may deem appropriate, including settling such audit or proceeding, subject to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may shall not be unreasonably withheld, conditioned withheld or delayed, provided that the Seller’s consent shall not be required if the Seller fails to confirm in writing to the Purchaser its consent or decline to consent within ten (10) Business Days of the Seller’s receipt of the Purchaser’s request for such settlement would affect consent (and for the amount avoidance of Taxes doubt, if the Purchaser fails to receive the Seller’s consent or decline to consent within ten (10) Business Days of the Seller’s receipt of the Purchaser’s request for consent, the Seller is deemed to have provided its consent to the Purchaser to settle such audit or proceeding). In the event that issues relating to a potential adjustment are required to be contested in the same audit or proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit or proceeding with respect to the latter issues, except to the extent that it would be harmful to the Seller.
(c) With respect to issues relating to a potential adjustment for which both the Seller and the Purchaser or any member of the Target Group could be liable, (i) both the Seller and the Purchaser may participate in the audit or proceeding and (ii) the audit or proceeding shall be liable controlled by the Purchaser, and the Seller and Purchaser shall take commercially reasonable efforts to separate such audit or proceeding so that issues relating to each of them can be handled separately. The principle set forth in this Section 7.04(c) also shall govern for purposes of deciding any issue that must be decided jointly (including choice of judicial forum) in situations in which separate issues are otherwise controlled under this AgreementArticle VII by the Purchaser and the Seller.
Appears in 2 contracts
Sources: Master Purchase Agreement, Master Purchase Agreement (China Lodging Group, LTD)
Contests. Whenever If an audit is commenced or any Taxing Authority asserts other claim is made by any Tax authority with respect to a claim, makes an assessment, Tax liability of the Company or otherwise disputes the amount any of Taxes its Subsidiaries for which Verizon, GTE or Seller may reasonably be expected to could be liable under this Agreement Section 5.3(b) (a “Tax Claim”"TAX CONTEST"), Purchaser Buyer shall upon receipt of notice promptly notify Seller of such Tax ClaimContest (unless Verizon, promptly inform GTE or Seller previously was notified in writing directly by the relevant Tax authority). If Seller so requests in writing and at Seller's expense, Buyer (1) shall cause the relevant entity (Buyer, the Company, any Subsidiary or any successor) to contest such Tax Contest on audit or by appropriate claim for refund or credit of Taxes or in a related administrative or judicial proceeding which Seller in writingits sole and absolute discretion chooses to direct such entity to pursue, and (2) shall permit Seller, at its expense, to control the prosecution and settlement of any such audit or refund claim or related administrative or judicial proceeding with respect to such Tax Contest; providedand, howeverwhere deemed necessary by Seller, Buyer shall cause the relevant entity to authorize by appropriate powers of attorney such persons as Seller shall designate to represent such entity with respect to such audit or refund claim or related administrative or judicial proceeding and to settle or otherwise resolve any such proceeding; PROVIDED that failure to give such notice as provided herein in any case under this subsection, (x) Seller shall not, without the prior written consent of Buyer, which consent shall not relieve Seller be unreasonably withheld, accept any proposed adjustment or enter into any settlement or agreement in compromise or otherwise dispose of any such audit or refund claim or related administrative or judicial proceeding in a manner that would purport to bind the Company if such actions would materially and adversely affect the Tax liability or Tax basis, depreciation, amortization, useful lives, net operating losses, or similar Tax items of Buyer, the Company or any of its obligations under this Article V except Subsidiaries for Taxable periods or portions thereof ending after the Closing Date and (y) Seller shall keep Buyer informed as to the extent that progress of any audit or refund claim or related administrative or judicial proceeding which Seller is materially prejudiced thereby. Seller has taken control of and Buyer shall have the right to elect consult with Seller during such proceedings at its own expense. Buyer shall further execute and deliver, or cause to control be executed and delivered, to Seller or its designee all instruments and documents reasonably requested by Seller to implement the defense provisions of this subsection. Any refund of Taxes obtained by Buyer or the affected entity with respect to any Tax Claim relating to taxable periods period (or portion thereof) of the Company ending on or before the Closing Date, or otherwise relating Date shall be paid promptly to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i5.3(c) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementhereof.
Appears in 2 contracts
Sources: Agreement of Merger (Tsi Finance Inc), Stock Purchase Agreement (Tsi Finance Inc)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify Parent in writing of any Taxing Authority asserts notice received by the Purchaser or any of its Subsidiaries of a claim, makes proposed assessment or claim in an assessmentaudit or administrative or judicial proceeding of the Purchaser or any of its Subsidiaries, or otherwise disputes of the amount of Taxes Company or SAP Thai, which, if determined adversely to the taxpayer, would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”)Article VII. If, following the receipt by the Purchaser shall upon receipt or any of its Subsidiaries of notice of such Tax Claima proposed assessment or claim, promptly inform Seller in writing; provided, however, that failure the Purchaser fails to give Parent the prompt notice required by the preceding sentence of this Section 7.03, then (i) if Parent is precluded by such notice as provided herein failure from contesting the asserted Tax liability in question, Parent shall not relieve Seller of its obligations have any obligation to indemnify the Purchaser under this Article V except VII for any loss or damage arising out of such asserted Tax liability, and (ii) if Parent is not precluded from contesting the asserted Tax liability in question, but such failure results in a monetary detriment to Parent, any amount which Parent otherwise would be required to pay the extent Purchaser pursuant to this Article VII with respect to such liability shall be reduced by the amount of such detriment.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right relates to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable provided that Parent acknowledges in writing its liability under this Agreement to hold the Purchaser and its Subsidiaries and the Company and SAP Thai harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding that relates to periods ending on or before the Closing Date (other than with respect or, in the case of any taxable year that includes the Closing Date, against an adjustment allocable under Section 7.01(b) to a Straddle Periodthe portion of such year ending on or before the Closing Date), Parent shall have the right at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Seller. If Seller timely elects audit or proceeding but only to control the extent that such audit or proceeding relates solely to a potential adjustment for which Parent has acknowledged its liability; the Purchaser also may participate in any such audit or proceeding and, if Parent does not assume the defense of any such Tax Claim audit or proceeding, the Purchaser may defend the same in accordance such manner as it may deem appropriate, including, without limitation, settling such audit or proceeding after giving five days' prior written notice to Parent setting forth the terms and conditions of settlement. In the event that issues relating to a potential adjustment for which Parent has acknowledged its liability are required to be dealt with in the same proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit or proceeding with respect to the latter issues.
(c) With respect to issues relating to a potential adjustment for which both Parent (as evidenced by its acknowledgment under this Section 5.067.03) and any of the Purchaser, one of its Subsidiaries or the Company or SAP Thai could be liable, (i) Seller shall keep Purchaser reasonably apprised of each party may participate in the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceeding and (ii) the audit or proceeding shall be controlled by that party which would bear the burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the immediately preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (including, without limitation, choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article VII by the Purchaser and Parent.
(d) Neither the Purchaser nor Parent shall have enter into any compromise or agree to settle any claim pursuant to any Tax audit or proceeding which would adversely affect the right to consentother party for such year or a subsequent year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . The Purchaser and Parent agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control cooperate in the defense against or thereafter fails compromise of any claim in any audit or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 2 contracts
Sources: Asset and Stock Purchase Agreement (Amcol International Corp), Asset and Stock Purchase Agreement (Amcol International Corp)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding or of any demand or claim on the Purchaser, makes an assessmentits Affiliates or any of the ▇▇▇▇▇▇ Entities which, if determined adversely to the taxpayer or otherwise disputes after the amount lapse of Taxes time, could be grounds for which indemnification by the Seller may reasonably be expected to be liable under this Agreement Section 7.01 (a “Tax Claim”). Such notice shall contain factual information (to the extent known to the Purchaser, its Affiliates or any ▇▇▇▇▇▇ Entity) describing the Claim in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such Claim. If the Purchaser shall upon receipt of fails to give the Seller prompt notice of a Claim as required by this Section 7.03, then the Seller shall not have any obligation to indemnify for any Loss arising out of such Tax Claim, promptly inform Seller in writing; provided, however, but only to the extent that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except results in a detriment to the extent Seller.
(b) In the case of a Tax audit or administrative or judicial proceeding (a “Contest”) that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Date, or otherwise relating the Seller shall have the sole right, at its expense, to Taxes for which control the conduct of such Contest.
(c) With respect to Straddle Periods, the Seller may be liable under this Agreement (other than elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax liability with respect to which Seller acknowledges liability indemnity may be sought from the Seller pursuant to Section 7.01. If the Seller elects to direct a Straddle Period)Contest, at its sole cost and expense by written notice to Purchaser the Seller shall within ten (10) 60 days of receipt of the notice thereofof asserted Tax liability notify the Purchaser of its intent to do so, and the Purchaser shall cooperate and shall cause the ▇▇▇▇▇▇ Entities to fully cooperate, at the Seller’s expense, in each phase of such Contest. If the Seller elects not to direct the Contest, the Purchaser or any ▇▇▇▇▇▇ Entity may assume control of such Contest (at the Purchaser’s expense). However, in such case, none of the Purchaser or any ▇▇▇▇▇▇ Entity may settle or compromise any asserted liability without prior written consent of the Seller; provided, however, that Purchaser mayconsent to settlement or compromise shall not be unreasonably delayed or withheld. In any event, the Seller may participate, at its sole cost and own expense, retain separate counsel of its choosing in the Contest.
(d) The Purchaser and the Seller agree to participate cooperate, and the Purchaser agrees to cause the ▇▇▇▇▇▇ Entities to cooperate, in the defense against or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense compromise of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Dow Chemical Co /De/), Stock Purchase Agreement (Rohm & Haas Co)
Contests. Whenever any Taxing Authority asserts a claim(a) After the Merger Effective Time, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt promptly notify the Seller in writing of the proposed assessment or the commencement of any Tax audit or administrative or judicial proceeding or of any demand or claim on the Purchaser, its Affiliates, the Company, any Subsidiary or any Joint Venture which, if determined adversely to the taxpayer or after the lapse of time, could be grounds for indemnification by the Seller under Section 7.01. Such notice shall contain factual information (to the extent known to the Purchaser, its Affiliates, the Company, any Subsidiary or any Joint Venture) describing the asserted Tax Liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax Liability. Any failure by the Purchaser to give the Seller prompt notice of an asserted Tax Liability as required by this Section 7.03, shall not limit the obligation of the Seller to indemnify the Purchaser, the Company, any Subsidiary or any Joint Venture for such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except Liability unless and only to the extent that Seller is materially prejudiced thereby. Seller shall have such failure resulted in an economic detriment to the right to elect to control Seller.
(b) In the defense case of any a Tax Claim relating audit or administrative or judicial proceeding (a “Contest”) that relates to taxable periods ending on or before the Closing Datedate of the Merger, the Seller shall have the sole right, at its expense, to direct and control the conduct of, or otherwise relating pursue or settle, such Contest.
(c) With respect to Taxes for which Straddle Periods, the Seller may be liable under this Agreement (other than elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax Liability with respect to which indemnity may be sought from the Seller pursuant to Section 7.01. If the Seller elects to direct a Straddle Period)Contest, at its sole cost and expense by written notice to Purchaser the Seller shall within ten thirty (1030) days of receipt of the notice thereof; providedof asserted Tax Liability notify the Purchaser of its intent to do so, howeverand the Purchaser shall cooperate and shall cause the Company, that Purchaser maythe Subsidiaries and the Joint Ventures to fully cooperate, at its sole cost and the Seller’s expense, retain separate counsel of its choosing to participate in the defense or settlement each phase of such Tax Claim by SellerContest. If the Seller timely elects not to control direct the defense of any such Tax Claim in accordance with this Section 5.06Contest, (i) the Seller shall keep promptly notify the Purchaser reasonably apprised and the Purchaser, the Company, any Subsidiary or any Joint Venture shall assume control of such Contest (at the Purchaser’s expense). The Seller shall fully cooperate in each phase of such Contest. Neither the Purchaser, the Company, any Subsidiary or any Joint Venture, on the one hand, nor the Seller, on the other hand, shall enter into any compromise or agree to settle any claim pursuant to such audit or proceeding which would adversely affect the other party for such taxable period or a subsequent taxable period without the written consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentother party, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend In any such Tax ClaimContest, Purchaser shall have the right to costs and expenses of the party assuming control the defense of such Tax Claims Contest shall be paid first from any recovery before any payments are made to either party. The Purchaser may participate, at its sole cost and own expense, in any Contest in which the Seller assumes control, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by participate, at its own expense, in any Contest in which the foregoing provisions of this Section 5.06Purchaser assumes control.
(d) The Purchaser and the Seller agree to cooperate, and the Purchaser shall have the right agrees to control any proceedings relating to Taxes of or with respect to cause the Company or any of its Subsidiaries; provided, however, thatand the Subsidiaries to cooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany Contest.
Appears in 2 contracts
Sources: Merger Agreement, Merger Agreement (PNA Group Holding CORP)
Contests. Whenever (a) After the Closing, the party first receiving notice shall promptly notify the other party in writing of any Taxing Authority asserts a claimdemand or claim on the first party from any Tax authority or other party with respect to Taxes for which the other party is liable pursuant to Section 7.01. Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If such notifying party fails to give the other party prompt notice of an asserted Tax liability as required by this Section 7.03, makes an assessmentthen (a) if the other party is precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then such notifying party shall have sole responsibility for such Tax liability or (b) if the other party is not precluded from contesting but such failure to give prompt notice results in detriment to the other party, then any amount that the other party is otherwise disputes required to pay to such notifying party pursuant to Section 7.01 with respect to such liability shall be reduced by the amount of Taxes for which such detriment.
(b) The Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense conduct to a final determination, through counsel of its own choosing and at its own expense, of any Tax Claim relating to taxable periods ending on audit, claim for refund and administrative or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than judicial proceeding involving any asserted liability with respect to which indemnity may be sought by the Purchaser under Section 7.01(a) (any such audit, claim for refund or proceeding relating to an asserted Tax liability is referred to herein as a Straddle Period"CONTEST"). If the Seller elects to control a Contest, at its sole cost and expense by written notice to Purchaser it shall within ten (10) 30 calendar days of receipt of the notice thereofof asserted Tax liability notify the Purchaser in writing of its intent to do so. In such case, thereafter the Seller shall have all rights to settle, compromise and/or concede such asserted liability and the Purchaser shall cooperate and shall cause a Publishing Subsidiary or any of its successors to cooperate, at the expense of the Seller, in each phase of such Contest; providedPROVIDED, howeverHOWEVER, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised not, other than in good faith based on the merits, enter into any compromise or settlement of such Contest that would result in any Tax detriment to the status of Purchaser, the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto Parent or any Publishing Subsidiary; and (ii) Purchaser if a Publishing Subsidiary is requested by the Seller to pay or cause to be paid the tax claimed and to ▇▇▇ for a refund, then the Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement advance to the extent such settlement would affect Publishing Subsidiary on an interest-free basis the amount of Taxes for which Tax claimed. The Seller shall inform the Purchaser of all developments and events relating to such Contest (including, without limitation, providing to the Purchaser copies of all written materials relating to such contest reasonably requested by Purchaser), and the Purchaser and its authorized representatives shall be entitled, at the expense of the Purchaser, to attend, but not participate in or control, all conferences, meetings and proceedings relating to such Contest. If, pursuant to Section 7.03(b)(ii), the Seller advances to a Publishing Subsidiary an 50 amount of Tax claimed under a Contest and there is a final determination that the Publishing Subsidiary is entitled to a refund of all or any portion thereof, then the Publishing Subsidiary shall promptly pay or cause to be paid to Seller such refund upon its Affiliates may be liable for taxable periods ending after receipt thereof (together with any interest paid or credited thereon by the Closing Dateapplicable Tax authority). If the Seller elects not to control the defense Contest, fails to notify the Purchaser of its election as herein provided or thereafter fails contests its obligation to indemnify under Section 7.01(a), the Purchaser or ceases a Publishing Subsidiary may pay, compromise or contest such asserted liability. Neither the Purchaser nor any Publishing Subsidiary may settle or compromise any asserted liability with respect to defend any such Tax Claimwhich indemnity may be sought by the Purchaser over the objection of the Seller; PROVIDED, Purchaser HOWEVER, that consent to settlement or compromise shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld. In any event, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementparticipate, at its own expense, in the Contest. Except as otherwise required by If the foregoing provisions of this Section 5.06Seller chooses to control the Contest, the Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company promptly empower and shall cause a Publishing Subsidiary or any of its Subsidiaries; providedsuccessors promptly to empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller as it may designate to represent the Purchaser, however, that, a Publishing Subsidiary or any of their successors in the case of a Contest insofar as the Contest involves an asserted Tax Claim liability with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller indemnity may be liable under this Agreementsought by the Purchaser.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Pearson PLC), Stock Purchase Agreement (Viacom Inc)
Contests. Whenever any Taxing Authority asserts taxing authority provides notice of an inquiry, audit, examination, proceeding or makes a claim, makes an assessmentwritten assertion of a claim for or dispute regarding, or otherwise disputes the amount of assessment of, Taxes (a "Tax Claim") for which Seller may reasonably be expected is liable or required to be liable provide indemnification under this Agreement (a “Tax Claim”)Agreement, Purchaser shall upon receipt shall, if informed of such notice of such Tax Claiman inquiry, promptly audit, examination, proceeding, assertion or assessment, inform Seller in writingwithin fifteen (15) calendar days; provided, however, that any failure to give such notice as provided herein inform Seller shall not relieve Seller of its obligations under this Article V obligation to provide the indemnity required hereunder as to such Tax Claim except to the extent that Seller is such failure has materially prejudiced therebySeller's ability to defend such Tax Claim. Seller shall have the right to elect control any resulting inquiry, audit, examination or proceedings and to control the defense of determine whether and when to settle any Tax Claim relating to taxable periods ending on resulting claim, assessment or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement dispute to the extent such settlement would affect the amount of Taxes for which Purchaser inquiry, audit, examination, proceedings or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would determinations affect the amount of Taxes for which Seller is liable or required to provide indemnification under this Agreement (including those attributable to the Straddle Period); provided, however, that (A) Seller shall have acknowledged that it is liable to the Purchaser Indemnified Parties for such Taxes under Section 6.6(b) (or the applicable portion of Taxes for such period, in the case of Taxes attributable to the Straddle Period); (B) Seller shall conduct such proceedings in a commercially reasonable manner; (C) Purchaser, the Company and the Subsidiaries may participate in such proceedings at their own expense; (D) Seller shall not compromise or settle, or agree to compromise or settle, any Tax Claim without Purchaser's consent (which shall not be unreasonably withheld or delayed); (E) if Seller does not so elect, Purchaser shall control the prosecution and defense of such Tax Claim, which shall be conducted in a commercially reasonable manner; and (F) if Purchaser so elects, it may override Seller's election to control the prosecution and defense of such Tax Claim, in which case the Purchaser Indemnified Parties shall be deemed to have waived their rights to indemnification for such Tax Claim. Whenever any taxing authority makes a Tax Claim for which Purchaser is liable or required to provide indemnification under this Agreement, Seller shall, if informed of such notice of an inquiry, audit, examination, proceeding, assertion or assessment, inform Purchaser within fifteen (15) calendar days; provided, however, that any failure to inform Purchaser shall not relieve Purchaser of its obligation to provide the indemnity required hereunder as to such Tax Claim except to the extent that such failure has materially prejudiced Purchaser's ability to defend such Tax Claim. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any all proceedings relating to Tax Claims (1) that Seller does not have the right to control under this Section 6.6(e) or (2) that do not relate exclusively to Taxes of or with respect to the Company or any of its Subsidiariesthe Subsidiaries for Pre-Effective Tax Periods or the Straddle Period; provided, however, that, in that to the case of extent a Tax Claim with respect could reasonably be expected to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would materially affect the amount of Taxes for which Seller may be is liable under or required to provide indemnification under this Agreement, (1) Purchaser shall conduct such proceedings in a commercially reasonable manner; and (2) Purchaser shall not compromise or settle, or agree to compromise or settle, such Tax Claim without Seller's consent (which shall not be unreasonably withheld or delayed).
Appears in 2 contracts
Sources: Stock Purchase Agreement (Brookdale Senior Living Inc.), Stock Purchase Agreement (Capstead Mortgage Corp)
Contests. Whenever any Taxing Authority asserts a claimFor purposes of this Agreement, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Contest” is any audit, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on court proceeding or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than dispute with respect to any tax matter that affects a Straddle Period)Target. Unless the Buyer has previously received written notice from the Seller of the existence of such Contest, at its sole cost and expense by the Buyer shall give written notice to Purchaser the Seller of the existence of any Contest relating to a tax matter that is the Seller’s responsibility under Section 8.2 within ten (10) days from the receipt by the Buyer of any written notice of such Contest, but no failure to give such notice shall relieve the Seller of any liability hereunder. Unless the Seller has previously received written notice from the Buyer of the existence of such Contest, the Seller shall give written notice to the Buyer of the existence of any Contest for which the Buyer has responsibility within ten (10) days from the receipt by the Seller of any written notice of such Contest. The Buyer, on the one hand, and the Seller, on the other, agree, in each case at no cost to the other party, to cooperate with the other and the other’s Representatives in a prompt and timely manner in connection with any Contest. Such cooperation shall include, but not be limited to, making available to the other party, during normal business hours, all books, records, Tax Returns, documents, files, other information (including working papers and schedules), officers or employees (without substantial interruption of employment) or other relevant information necessary or useful in connection with any Contest requiring any such books, records and files. The Seller shall, at its election, have the right to represent a Target’s interests in any Contest relating to a Tax matter arising in a period ending on or before the Effective Date, to employ counsel of its choice at its expense and to control the conduct of such Contest, including settlement or other disposition thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser Buyer shall have the right to consentconsult with the Seller regarding any such Contest that may affect such Target for any periods ending after the Effective Date at the Buyer’s own expense and provided, further, that any settlement or other disposition of any such Contest may only be with the consent of the Buyer, which consent may will not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Purchase and Sale Agreement, Purchase and Sale Agreement (Marriott International Inc /Md/)
Contests. Whenever (a) The Buyer will notify the Seller Representative in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial Proceeding or of any demand or Claim on the Buyer and its Affiliates or the Seller that, makes an assessmentif determined adversely to the taxpayer after the lapse of time, or otherwise disputes could be grounds for indemnification by the amount of Taxes for which Seller may reasonably be expected under Section 8.1, provided that the failure to be liable provide notice will not affect any rights under this Agreement (a “Tax Claim”)Agreement, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that the failure prejudices the Indemnifying Party. The Buyer’s notice will contain factual information (to the extent known to the Buyer and its Affiliates) briefly describing the asserted Tax liability and will include copies of any notice or other document received from any Taxing Authority in respect of any such asserted Tax liability.
(b) The Seller is materially prejudiced thereby. Seller shall Representative will have the right to elect sole right, at its expense, to control the defense of any conduct of, a Tax Claim relating audit or administrative or judicial Proceeding (a “Contest”) that relates to taxable periods Taxable Periods ending on or before the Closing Date; provided that, if any such Proceeding would result in an adjustment to Tax that would have an adverse effect on the Buyer or any of its Affiliates for a period ending after the Closing Date, the Seller Representative (i) will permit the Buyer to participate in the Proceeding, and (ii) will not settle or otherwise relating compromise the Proceeding without the Buyer’s prior written consent, which consent will not be unreasonably withheld.
(c) The Seller Representative may elect to participate, at its expense, in any Contest involving any asserted Tax liability for Straddle Period Taxes for which Seller may be liable under this Agreement (other than with respect to which indemnity may be sought from the Seller pursuant to Section 8.1.
(d) The Buyer will not take any position or agree to any settlement in a Straddle PeriodContest that would result in liability of the Seller or an indemnity Claim by the Buyer or the Buyer Sub against the Seller without the Seller Representative’s prior written consent, which consent will not be unreasonably withheld, except as follows:
(i) the Buyer will notify the Seller Representative in writing (when practical) of the Buyer’s intent to take any such position in a Contest, and include with the notice a description of the Buyer’s position and its rationale for doing so;
(ii) if within 10 days after the Buyer gives its notice, the Seller Representative gives the Buyer written notice objecting to its position, then the Parties will meet, together with their respective attorney(s) and/or accountant(s), as promptly as feasible, and attempt to agree on a position and/or strategy for the Buyer to take in the matter;
(iii) if the Parties are unable to agree on a position and/or strategy, then either Party may refer the matter to the Appointed Arbiter to review their respective positions and to provide their arguments in support of the positions;
(iv) if the Appointed Arbiter determines that there is substantial authority within the meaning of Treasury Regulations Section 1.6662-4(d)(2) for the position asserted by the Seller Representative, then the Buyer will proceed with such position in the Contest;
(v) alternatively, if the Appointed Arbiter determines that there is no substantial authority for the position asserted by the Seller Representative, then the Buyer may proceed with the Contest taking the position the Appointed Arbiter recommends as being feasible, with a substantial authority basis that is favorable to the Buyer;
(vi) the Buyer will, upon the Seller Representative’s request, appeal a determination in a Contest (at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its the Seller Representative’s sole cost and expense, retain separate counsel of its choosing to participate in which the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control Representative will pay directly and not from the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its SubsidiariesEscrow Amount); provided, howeverthe Buyer need only assert positions that the Appointed Arbiter determines have substantial authority within the meaning of Treasury Regulations Section 1.6662-4(d)(2); and
(vii) the Buyer will pay one-half of the fees, thatcosts and expenses of the Appointed Arbiter and the Seller Representative will pay the other one-half, except as provided in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementSection 8.5(d)(vi).
Appears in 2 contracts
Sources: Asset Purchase Agreement, Asset Purchase Agreement (Avon Products Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except Subject to the extent that Seller is materially prejudiced thereby. Seller rights of insurers under policies of -------- insurance maintained pursuant to Section 16 of the Charter, the Charterer shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser mayright, at its sole cost and expense, retain separate counsel to investigate, and the right in its sole discretion to defend or compromise, any Claim for which indemnification is sought under this Section 13.1, and the Indemnitee shall cooperate, at the Charterer's expense, with all reasonable requests of its choosing to participate the Charterer in connection therewith. The Charterer will provide the Indemnitee with such information not within the control of such Indemnitee, as is in the defense Charterer's control or settlement is reasonably available to the Charterer, which such Indemnitee may reasonably request and shall otherwise cooperate with such Indemnitee so as to enable such Indemnitee to fulfill its obligations under this Section 13.
1. Where the Charterer or the insurers under a policy of such Tax Claim insurance maintained by Seller. If Seller timely elects to control the Charterer undertake the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser an Indemnitee with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax a Claim, Purchaser shall have the right to control no additional legal fees or expenses of such Indemnitee in connection with the defense of such Tax Claims claim shall be indemnified hereunder unless such fees or expenses were incurred at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned request of the Charterer or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiariesinsurers; provided, however, thatthat if (i) in the written -------- ------- opinion of counsel to such Indemnitee an actual or potential material conflict of interest exists where it is advisable for such Indemnitee to be represented by separate counsel or (ii) such Indemnitee has been indicted or otherwise charged in a criminal complaint in connection with a Claim not excluded by Section 13.1(a) and such Indemnitee informs the Charterer that such Indemnitee desires to be represented by separate counsel, the reasonable fees and expenses of such separate counsel shall be borne by the Charterer. Subject to the requirements of any policy of insurance, an Indemnitee may participate at its own expense in any judicial proceeding controlled by the Charterer pursuant to the preceding provisions; provided that such party's participation does not, in -------- the case reasonable opinion of the independent counsel appointed by the Charterer or its insurers to conduct such proceedings, significantly interfere with such control; and such participation shall not constitute a waiver of the right to receive the indemnification provided in this Section 13.1. Notwithstanding anything to the contrary contained herein, (x) the Charterer shall not under any circumstances be liable for the fees and expenses of more than one counsel for each of (i) the Owner Participant and the Owner Trust (and their respective successors and permitted assigns, agents and servants) and (ii) the Loan Participants and the Indenture Trustee (and their respective successors and permitted assigns, agents and servants), and (y) during the continuance of a Tax Claim with respect to a Straddle PeriodCharter Event of Default, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser Charterer shall not settle such portion of such Tax compromise any Claim without the Seller’s consentconsent of the applicable Indemnitee, which such consent may not to be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 2 contracts
Sources: Participation Agreement (Mobil Corp), Participation Agreement (Mobil Corp)
Contests. Whenever (a) The Tax Indemnitee shall notify the Stockholders’ Representative in writing promptly, and in any Taxing Authority asserts a claimevent within thirty (30) days, makes of becoming aware of the commencement after the Closing Date of any Contest that could give rise to an assessment, or otherwise disputes indemnification payment under Section 7.1 (the amount of Taxes for which Seller may reasonably be expected specific issues that could give rise to be liable under this Agreement (a such indemnification are referred to herein as “Tax ClaimIndemnifiable Matters”), Purchaser . Such notice shall upon receipt contain factual information (to the extent known to the Tax Indemnitee or its Affiliates) with respect to Tax Indemnifiable Matters in reasonable detail and shall include copies of any notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure or other document (to give the extent such notice as provided herein or document relates to Tax Indemnifiable Matters) received from any Governmental Authority in respect thereof.
(b) The Tax Indemnitee shall not relieve Seller of its obligations under this Article V except control all Contests, but to the extent that Seller a Contest involves issues for which the Tax Indemnitee may be entitled to a payment under Section 7.1(a), the Stockholders’ Representative or its duly appointed representatives shall be allowed to attend all meetings between the Tax Indemnitee and the Governmental Authority in question and shall be provided with copies of all material correspondence and documents, to the extent relating to Tax Indemnifiable Matters. Neither the Tax Indemnitee nor any of its Affiliates may settle or compromise any asserted Tax liability in a Contest, to the extent relating to Tax Indemnifiable Matters, without the consent of the Stockholders’ Representative, which consent shall not be unreasonably withheld or delayed. For the avoidance of doubt, a Tax Indemnitee’s decision not to contest a Contest will be considered to be a settlement of that Contest for purposes of the preceding sentence. For purposes of this Section 7.5(b), if the Tax Indemnitee and the Stockholders’ Representative cannot come to agreement as to whether consent is materially prejudiced therebybeing, or will be, unreasonably withheld or delayed within 30 days of the Stockholders’ Representative’s initial refusal to provide consent, such disagreement shall be resolved by the Accounting Firm. Seller The determination of the Accounting Firm shall be final and binding on both parties and may be entered and enforced in any court having jurisdiction.
(c) Notwithstanding the foregoing, Parent or one of its Affiliates, as the case may be, shall have the right to elect to control prohibit the defense of Stockholders’ Representative from participating in any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect Contest as it relates to a Straddle Period), at its sole cost specific matter if Parent and expense by written notice Tax Indemnitee(s) have waived their rights to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of indemnity for such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementmatter.
Appears in 2 contracts
Sources: Merger Agreement (GXS Worldwide, Inc.), Merger Agreement (Open Text Corp)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (a) After the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Closing, Purchaser shall upon receipt promptly notify Sellers in writing of any written notice of such Tax Claima proposed assessment or claim in an audit or administrative or judicial proceeding of Purchaser or the Company which, promptly inform Seller in writingif determined adversely to the taxpayer, would be grounds for indemnification under this Article IX; provided, however, that the failure to give such written notice as provided herein shall will not relieve Seller of its obligations affect Purchaser’s right to indemnification under this Article V IX except to the extent extent, if any, that Seller is materially prejudiced thereby. Seller shall have Purchaser’s failure to so notify Sellers precludes Sellers from contesting the right Tax in question.
(b) In the case of an audit or administrative or judicial proceeding that relates to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, Sellers shall have the right at their expense to participate in and control the conduct of such audit or otherwise relating to Taxes for which Seller proceeding; provided, however, Purchaser may be liable under this Agreement (other than with respect to a Straddle Period), participate in any such audit or proceeding at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; providedand, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control if Sellers do not assume the defense of any such Tax Claim audit or proceeding, Purchaser may defend the same in accordance with this Section 5.06such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding after five (5) Business Days prior written notice to Sellers setting forth the terms and conditions of settlement. The parties will work together to resolve any disputes should Sellers timely object to any settlement proposed by the Purchaser.
(c) With respect to issues relating to a potential adjustment for which both Sellers and Purchaser or the Company could be liable, (i) Seller shall keep Purchaser reasonably apprised of each party may participate in the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceedings, and (ii) the audit or proceedings shall be controlled by that party which would bear the burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the immediately preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (including choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article IX by Purchaser and Sellers.
(d) Neither Purchaser nor Sellers shall have enter into any compromise or agree to settle any claim pursuant to any Tax audit or proceeding which would adversely affect the right to consentother party for such year or a subsequent year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned withheld or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which . Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser and Sellers shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Periodcooperate, and Purchaser shall not settle such portion cause the Company to cooperate, in the defense against or compromise of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned any claim in any audit or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 2 contracts
Sources: Purchase Agreement (Viewpoint Corp), Purchase Agreement (Viewpoint Corp)
Contests. Whenever Purchaser and the Seller Representative agree to give prompt notice to each other of any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of proposed adjustment to Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt any periods of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods Company ending on or before prior to the Closing Date, Date or otherwise relating to Taxes any Pre-Closing Partial Period. Purchaser and the Seller Representative shall cooperate with each other in the conduct of any audit or other proceeding involving the Company for which Seller such periods and each party may be liable under this Agreement (other than with respect to a Straddle Period), participate at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and own expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser Representative shall have the right to control the defense conduct of any such audit or proceeding for which the Sellers agree that any resulting Tax Claims at its sole cost allocable to any period prior to and expenseincluding the Closing Date is covered by the indemnity set forth in Section 13.8 of this Agreement, (such audit or proceeding, a "Seller's Contest") provided that: (i) Seller Representative shall keep Purchaser informed regarding the progress and substantive aspects of any Seller's Contest and (ii) Seller Representative shall not compromise or settle any Seller's Contest if such compromise or settlement would have the right to effect of (x) increasing any Tax liability of the Company or (y) otherwise materially and adversely affect any item or Tax attribute of the Company, in each case for any taxable period ending after the Closing Date, without obtaining Purchaser's consent, which consent may shall not be unreasonably withheld. If Seller Representative chooses to direct a Seller's Contest, conditioned or delayedPurchaser shall cause powers of attorney authorizing Seller Representative to represent the Company before the relevant taxing authority and such other documents as are reasonably necessary for Seller Representative to control the conduct of any Sellers' Contest, to any settlement thereof to consistent with the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions terms of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.13.5
Appears in 2 contracts
Sources: Stock Purchase Agreement (Usinternetworking Inc), Stock Purchase Agreement (Usinternetworking Inc)
Contests. Whenever any Taxing Authority asserts a claim(a) After the Closing, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser party first receiving notice shall upon receipt of notice of such Tax Claim, promptly inform Seller notify the other party in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense writing of any demand or claim on the first party from any Tax Claim relating to taxable periods ending on authority or before the Closing Date, or otherwise relating other party with respect to Taxes for which Seller may be the other party is liable under pursuant to Section 8.1. Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If such notifying party fails to give the other party prompt notice of an asserted Tax liability as required by this Agreement Section 8.3, then (a) if the other than party is precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then such notifying party shall have sole responsibility for such Tax liability or (b) if the other party is not precluded from contesting but such failure to give prompt notice results in detriment to the other party, then any amount that the other party is otherwise required to pay to such notifying party pursuant to Section 8.1 with respect to a Straddle Period)such liability shall be reduced by the amount of such detriment.
(b) Parent, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and own expense, retain separate shall control the conduct to a final determination, through counsel of its own choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense at its own expense, of any such Tax Claim in accordance with this Section 5.06audit, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim claim for refund and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned administrative or delayed, to judicial proceeding involving any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or asserted liability with respect to the which indemnity may be sought by CS under Section 8.1(a) (any such audit, claim for refund or proceeding relating to an asserted Tax liability is referred to herein as a "CONTEST"). Parent shall have all rights to settle, compromise and/or concede such asserted liability and CS shall cooperate, and shall cause a Beverage Company or any of its Subsidiaries; provided, however, thatsuccessors to cooperate, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion each phase of such Straddle Period Contest PROVIDED, HOWEVER, that Parent shall not settle, compromise or concede any such liability that is reasonably likely to result in a Pre-Closing Tax Period, and Purchaser shall not settle such portion cost to CS or its Affiliates in excess of such Tax Claim $100,000.00 without the Seller’s CS's consent, which consent may not to be unreasonably withheld. Parent shall inform CS of all material developments and events relating to such Contest (including, conditioned without limitation, providing to CS copies of all written materials relating to such Contest reasonably requested by CS), and CS and its authorized representatives shall be entitled, at the expense of CS, to attend, but not participate in or delayedcontrol, if all conferences, meetings and proceedings relating to such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 1 contract
Contests. Whenever (a) After the Closing, Purchaser shall promptly notify Seller in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding or of any demand or claim on TEC, makes an assessmentAenP, or otherwise disputes Electroandes which, if determined adversely to the amount taxpayer or after the lapse of Taxes time, could be grounds for which indemnification by Seller may reasonably be expected under Section 9.11. Such notice shall contain factual information (to be liable under the extent known to Purchaser) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If Purchaser fails to give Seller prompt notice of an asserted Tax liability as required by this Agreement Section 9.13, then Seller shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, but only to the extent that failure to give such notice results in a detriment to Seller.
(b) In the case of a Tax audit or administrative or judicial proceeding (a “Contest”) that relates to Indemnified Taxes, Seller shall have the sole right, at its expense, to control the conduct of such Contest. Seller shall consult with Purchaser and shall keep Purchaser reasonably informed with respect to any such Contest.
(c) With respect to Straddle Periods, Seller may elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax Claim”)liability with respect to which indemnity may be sought from Seller pursuant to Section 9.11. If Seller elects to direct a Contest, Seller shall within 90 days of receipt of the notice of asserted Tax liability notify Purchaser of its intent to do so, and Purchaser shall cooperate and shall cause AenP, TEC and Electroandes to cooperate fully, in such Contest. If Seller elects not to direct the Contest, Purchaser shall upon receipt of notice may assume control of such Tax ClaimContest (at Purchaser’s expense). However, promptly inform Seller in writingsuch case, none of Purchaser, AenP, TEC or Electroandes may settle or compromise any asserted liability without prior written consent of Seller; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld. In any event, conditioned or delayed, Seller may participate in the Contest.
(d) Purchaser and Seller agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Purchaser agrees to consentcause AenP, which consent may not be unreasonably withheld, conditioned or delayed, TEC and Electroandes to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatcooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany Contest.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Pseg Energy Holdings LLC)
Contests. Whenever The Buyer shall promptly notify the Sellers' Representative in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding involving the Company or any Subsidiary which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”)Section 6.4; PROVIDED, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, howeverHOWEVER, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect the Buyer's right to indemnification hereunder, except to the extent extent, if any, that, but for such failure, the Sellers' Representative could have avoided the Tax liability in question. In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller relates to any Pre-Closing Period, PROVIDED that within 30 days after the Sellers' Representative receives the written notice from the Buyer required under this Section 6.4(d) and prior to taking any action with respect to such audit or administrative or judicial proceeding, the Sellers' Representative acknowledges in writing the Sellers' liability under this Section 6.4 to hold the Buyer and the Company harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding, the Sellers' Representative shall have the right to elect at his, her or its own expense to control the defense conduct of any Tax Claim relating to taxable periods ending on such audit or before proceeding; PROVIDED, HOWEVER, that the Closing Date, Sellers' Representative shall not settle or otherwise relating to Taxes compromise any issue or matter without the Buyer's prior written consent if such issue or matter will have a material effect on the Tax liability of the Buyer or the Company or any Subsidiary for which Seller a post-Closing taxable year or period. The Buyer also may be liable under this Agreement (other than with respect to a Straddle Period), participate in any such audit or proceeding at its sole cost and own expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; providedand, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in if the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control Sellers' Representative does not assume the defense of any such Tax Claim in accordance with audit or proceeding, the Buyer may, without any effect to its or the Company's right to indemnification under this Section 5.066.4, (i) Seller shall keep Purchaser reasonably apprised of defend the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentsame in such manner as it may deem appropriate, which consent may including, but not be unreasonably withheldlimited to, conditioned settling such audit or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding. Except as provided otherwise required by the foregoing provisions of in this Section 5.066.4(d), Purchaser the Buyer shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost own expense any and expense) to the extent such Tax Claim is all audit, administrative and judicial proceedings related to the portion of such Straddle Period that is a Pre-Closing Tax PeriodCompany, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned Subsidiaries or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementtheir Taxes.
Appears in 1 contract
Sources: Share Purchase Agreement (Russell-Stanley Holdings Inc)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing of any Taxing Authority asserts demand or claim received by the Purchaser or the Company from any Tax authority or other party with respect to Taxes for which the Seller is liable pursuant to Section 7.01(a). Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller prompt notice of an asserted Tax liability as required by this Section 7.03, then (a) if the Seller (or its designee) is precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then the Purchaser shall have sole responsibility for such Tax liability or (b) if the Seller (or its designee) is not precluded from contesting but such failure to give prompt notice results in a claimdetriment to the Seller (or its designee), makes an assessment, or then any amount that the Seller is otherwise disputes required to pay to the Purchaser pursuant to Section 7.01 with respect to such liability shall be reduced by the amount of Taxes for which such detriment.
(b) The Seller (or its designee) may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense conduct, through counsel of its own choosing and at its own expense, of any Tax Claim relating to taxable periods ending on audit, claim for refund and administrative or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than judicial proceeding involving any asserted liability with respect to which indemnity may be sought under Section 7.01(a) (any such audit, claim for refund or proceeding relating to an asserted Tax liability is referred to herein as a Straddle Period"Contest"). If the Seller (or its designee) elects to control a Contest, at its sole cost and expense by written notice to Purchaser it shall within ten (10) 20 calendar days of receipt of the notice thereofof asserted Tax liability notify the Purchaser of its intent to do so, the Seller (or its designee) shall have all rights to settle, compromise and/or concede such asserted liability and the Purchaser shall cooperate and shall cause the Company or any of its successors to cooperate, at the reasonable expense of the Seller, in each phase of such Contest; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent consult with Seller regarding any Contest that may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes Company for which Purchaser or its Affiliates may be liable for taxable periods ending any period after the Closing DateDate and provided, further, that Seller shall not, other than in good faith based on the merits, enter into any compromise or settlement of such contest that would result in any Tax detriment to the Purchaser or Company. If the Seller elects not to control the defense Contest, fails to notify the Purchaser of its election as herein provided or thereafter fails contests its obligation to indemnify under Section 7.01(a), the Purchaser or ceases the Company may pay, compromise or contest, at its own expense, such asserted liability subject to defend reimbursement to the extent of reasonable third party expenses. In any such Tax Claimevent, Purchaser shall have the right Seller (or its designee) may participate, at its own expense, in the Contest. If the Seller (or its designee) chooses to control the defense of such Tax Claims at its sole cost and expenseContest, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to promptly empower and shall cause the Company or any of its Subsidiaries; providedsuccessors promptly to empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller (or its designee) as it may designate to represent the Purchaser, however, that, the Company or any of their successors in the case of a Contest insofar as the Contest involves an asserted Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes liability for which the Seller may would be liable under this AgreementSection 7.01(a).
Appears in 1 contract
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing of any Taxing Authority asserts demand or claim received by the Purchaser or an Acquired Subsidiary from any Tax authority or other party with respect to Taxes for which the Seller is liable pursuant to Section 7.01. Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller prompt notice of an asserted Tax liability as required by this Section 7.03, then (i) if the Seller is precluded by the failure to give prompt notice from contesting the asserted tax liability in both the administrative and judicial forums, then the Purchaser shall have sole responsibility for such Tax liability or (ii) if the Seller is not so precluded from contesting but such failure to give prompt notice results in a claimdetriment to the Seller, makes an assessment, or then any amount which the Seller is otherwise disputes required to pay the Purchaser pursuant to Section 7.01 with respect to such liability shall be reduced by the amount of Taxes for which such detriment.
(b) The Seller may reasonably elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be expected sought under Section 7.01 (any such audit, claim for refund or proceeding relating to be liable under this Agreement an asserted Tax liability is referred to herein as a "Contest"). If the Seller elects to direct a Contest, it shall within thirty (a “30) calendar days of receipt of the notice of asserted Tax Claim”)liability notify the Purchaser of its intent to do so, and the Purchaser shall upon receipt cooperate and shall cause an Acquired Subsidiary or any of notice its successors to cooperate, at the expense of the Seller, in each phase of such Tax ClaimContest. If the Seller elects not to direct the Contest, promptly inform Seller fails to notify the Purchaser of its election as herein provided or contests its obligation to indemnify under Section 7.01, the Purchaser or an Acquired Subsidiary may pay, compromise or contest, at its own expense, such asserted liability. However, in writingsuch case, neither the Purchaser nor any Acquired Subsidiary may settle or compromise any asserted liability over the objection of the Seller; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld. In any event, conditioned or delayedthe Seller may participate, to any settlement to at its own expense, in the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing DateContest. If the Seller elects not chooses to control direct the defense or thereafter fails or ceases to defend any such Tax ClaimContest, the Purchaser shall have the right to control the defense of such Tax Claims at its sole cost promptly empower and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company cause an Acquired Subsidiary or any of its Subsidiaries; providedsuccessors promptly to empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller as it may designate to represent the Purchaser, however, that, an Acquired Subsidiary or any of their successors in the case of a Contest insofar as the Contest involves an asserted Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes liability for which the Seller may would be liable under this AgreementSection 7.01(a).
Appears in 1 contract
Sources: Stock Purchase Agreement (Wherehouse Entertainment Inc /New/)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Sellers in writing of any Taxing Authority asserts a claim, makes an assessmentwritten notice of the commencement of any Action or proposed assessment or Claim made against, or otherwise disputes with respect to, the amount Purchaser or any of Taxes the Acquired Companies or Subsidiaries which (i) relates to a Pre-Closing Period or a Straddle Period of any Acquired Company or Subsidiary or (ii) if determined adversely to the taxpayer, could be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement Article VII (a “Tax ClaimAction”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that the failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser’s right to indemnification under this Article V VII except to the extent that Seller is materially prejudiced thereby. Seller shall extent, if any, that, but for such failure, the Sellers could have avoided all or a portion of the right to elect to control Tax liability in question.
(b) In the defense case of any a Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement Action (other than with respect a Tax Action that relates to a Straddle Period), provided that, and only to the extent that, the Sellers acknowledge in writing their liability under this Agreement to hold the Purchaser, the Acquired Companies and the Subsidiaries harmless against the amount of any adjustment which may be made as a result of such audit or proceeding that relates to Pre-Closing Periods to the extent so provided under Section 7.01, the Sellers shall have the right, at its sole cost and expense by written notice their expense, to control the conduct of the Tax Action, provided that the Sellers shall keep the Purchaser within ten (10) days informed as to the progress of receipt of notice thereof; provided, however, that the Tax Action in a timely manner. The Purchaser maymay also, at its sole cost and expense, retain separate counsel of its choosing participate in, but not control, any such Tax Action to participate in the extent that it is related to a Stand-Alone Return or a Non-Income Tax Return and, if the Sellers do not assume the defense or settlement of a Tax Action, the Purchaser may defend the same in such manner as it may deem appropriate. In the case of a Tax Action that relates to a Straddle Period, the Purchaser shall have the right, at its expense, to control the Tax Action; the Sellers may also, at their expense, participate in, but not control, any such Tax Claim by Seller. If Seller timely elects to control Action and, if the Purchaser does not assume the defense of any such Tax Claim Action, the Sellers may defend the same in accordance with this Section 5.06, such manner as they may deem appropriate.
(c) In the event that there is a Tax Action that involves (i) Seller shall keep Purchaser reasonably apprised the commencement of the status a tax examination or audit of the Tax Claim one or more Pre-Closing Periods and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto either a Straddle Period and/or one or more Post-Closing Periods and (ii) the same type of Non-Income Tax (or Income Tax, if no Section 338(h)(10) Election was allowed by the relevant Governmental Authority or a Governmental Authority is challenging a Section 338(h)(10) Election) is at issue with respect to all such periods, then, the Sellers and the Purchaser may participate in the audit or examination and the audit or examination shall be jointly controlled by Sellers and Purchaser with respect to the Non-Income Tax (or Income Tax) at issue, provided, however, that at the point that it can be reasonably determined which party would have the right burden of the greater portion of the sum of any proposed adjustments and any corresponding adjustments for such periods, then that party shall control the audit and examination
(d) Notwithstanding anything to consentthe contrary in this Section 7.04, with respect to any taxable period that begins before the Closing Date, neither the Purchaser nor the Sellers shall enter into any compromise or agree to settle any Tax Action which would adversely affect the other party for such taxable period or a subsequent taxable period without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . The Purchaser and the Sellers agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Purchaser agrees to consent, which consent may not be unreasonably withheld, conditioned or delayed, cause the Acquired Companies and the Subsidiaries to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatcooperate, in the case defense against or compromise of a any Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementAction.
Appears in 1 contract
Contests. Whenever (a) After the date of the Effective Time, Parent shall promptly notify the Equityholders’ Representative in writing of any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of written notice of such Tax Claima proposed adjustment or claim in an audit or administrative or judicial proceeding involving Parent or the Company or its Subsidiaries which, promptly inform Seller in writingif determined adversely to the taxpayer, would be grounds for indemnification under Article IX; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect Parent's right to indemnification thereunder except to the extent extent, if any, that, but for such failure, the Equity Holders could have avoided the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Datedate of the Effective Time, or otherwise relating to Taxes for which Seller may be liable provided that the Equityholders’ Representative on behalf of all Equity Holders acknowledges in writing the Equity Holders’ liability under this Agreement (other than to hold Parent and the Surviving Corporation and its Subsidiaries harmless against the full amount of any adjustment that may be made as a result of such audit or proceeding, and provided further that such audit or proceeding relates solely to a potential adjustment for which the Equityholders’ Representative has acknowledged the Equity Holders’ liability and the issue underlying the proposed adjustment if resolved would not materially prejudice the Surviving Corporation or its Subsidiaries from taking a contrary position for any period ending after the date of the Effective Time with respect to a Straddle Period)such recurring issue, the Equityholders’ Representative shall have the right at its sole cost and the Equity Holders’ expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Selleraudit or proceeding. The Equityholders’ Representative shall keep Parent informed of the progress of any such audit or proceeding, and Parent also may participate in any such audit or proceeding at its expense. If Seller timely elects to control the Equityholders’ Representative does not assume the defense of any such Tax Claim audit or proceeding, Parent may defend the same in accordance with this such manner as it may deem appropriate at its expense, including, but not limited to, settling such audit or proceeding.
(c) With respect to an audit or proceeding that relates to a potential adjustment for which the Equity Holders are liable and as to which the second proviso set forth in Section 5.0610.3(b) is not satisfied, (i) Seller shall keep Purchaser reasonably apprised of the status of Equityholders’ Representative may participate in the Tax Claim and audit or proceeding at its expense provided that the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto first proviso set forth in Section 10.3(b) is satisfied, and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned audit or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller proceeding shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementcontrolled by Parent.
Appears in 1 contract
Contests. Whenever If any Taxing Governmental Authority asserts issues to the Company a claimwritten notice of its intent to audit, makes examine or conduct a proceeding, a written notice of its determination of an assessmentobjection to an assessment with respect to Taxes or Tax Returns of the Company for a Pre-Closing Tax Period or a Straddle Period, or otherwise disputes a written notice or inquiry with respect to any Taxes or the amount filing of Taxes a Tax Return for which Seller may reasonably be expected to be liable under this Agreement a Pre-Closing Tax Period or a Straddle Period (a “Tax Claim”), Purchaser Buyer shall upon notify Seller of its receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; providedBusiness Days following receipt, provided however, that Purchaser maythe failure of the Buyer to notify Seller of its receipt of a Tax Claim within ten (10) Business Days shall not relieve the Seller from liability pursuant to Section 6.03(a) except to the extent the Seller is materially prejudiced as a consequence of such failure. Seller shall control any Tax Claim and any other matter with respect to a Pre-Closing Tax Period of the Company (a “Seller’s Tax Contest”), provided that Buyer, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentparticipate in any Seller’s Tax Contest that does not involve income Taxes and provided further that the Seller shall provide the Buyer with a copy of the final resolution of any Seller’s Tax Contest and any other information reasonably requested by Buyer concerning any Seller’s Tax Contest, provided that such requests relate solely to information of the Company. The Buyer shall control any Tax Claim that is not a Seller’s Tax Contest (a “Buyer’s Tax Contest”), provided that Seller, at its sole cost and expense, shall have the right to participate in any Buyer’s Tax Contest that relates to a Straddle Period Return. The party controlling a Tax Claim described in the preceding sentence shall not agree to settle such Tax Claim if such settlement could affect the Tax liability of the other party without the written consent of such other party, which consent may shall not be unreasonably withheld, conditioned or delayed, to provided that if any settlement to party (the extent such settlement would affect “First Party”) shall reasonably withhold consent for a settlement, the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after other party (the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller “Second Party”) shall be entitled to participate in enter into such proceeding (at its sole cost and expense) settlement without the consent of the First Party so long as the Second Party agrees to indemnify the extent such First Party for any adverse Tax Claim is related to consequences suffered by the portion First Party as a result of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementsettlement.
Appears in 1 contract
Sources: Stock Purchase Agreement (Nuverra Environmental Solutions, Inc.)
Contests. Whenever (a) After the Closing Date, Buyer shall notify Seller in writing within ten (10) days of the date a claim is made or threatened in writing by any Taxing Authority asserts a claimthat, makes an assessmentif successful, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable result in an indemnity payment by Seller under this Agreement Section 11.1 (a “Tax Claim”), Purchaser . Such notice shall upon receipt of notice contain factual information describing in reasonable detail the nature and basis of such claim and the amount thereof, to the extent known, and shall include copies of any notice or other document received from any Taxing Authority in respect of any such asserted Tax Claim, promptly inform Seller in writing; provided, however, that failure liability. Failure by Buyer to give such notice as provided herein to the Seller shall not relieve the Seller of any liability that it may have on account of its obligations indemnification obligation under this Article V Section 11, except to the extent that Seller demonstrates that the defense of such claim is materially prejudiced thereby. by Buyer’s failure to give such notice.
(b) Seller shall will have the right right, at its option, upon timely notice to elect Buyer, to assume at its own expense control the of any Audit or other defense of any Tax Claim (other than a Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating solely to Taxes of ▇▇▇▇ for a Straddle Period, which as described below, the parties shall jointly control) with its own counsel, provided that Seller’s notice acknowledges Seller’s indemnification liability for such claim. Seller’s right to control a Tax Claim will be limited to issues in respect of which amounts in dispute would be paid by Seller or for which Seller may would be liable under this Agreement (other than with respect pursuant to Section 11.1. Costs of defending or contesting such Tax Claims are to be borne by Seller unless the Tax Claim relates to a Straddle Period), in which event such costs shall be fairly apportioned as described below. Buyer and ▇▇▇▇ at its sole cost their own expense each shall cooperate with Seller in contesting any Tax Claim, which cooperation shall include the retention and, upon Seller’s request, the provision of records and expense by written notice information that are reasonably relevant to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects and making employees available on a mutually convenient basis to control the defense provide additional information or explanation of any such material provided hereunder. Notwithstanding the foregoing, Seller shall neither consent nor agree to the settlement of any Tax Claim with respect to any liability for Taxes in accordance with this excess of US Dollars ten thousand (USD 10,000) on the part of ▇▇▇▇ or any affiliated group (as defined in Section 5.06, (i1504(a) Seller shall keep Purchaser reasonably apprised of the status Code) of which ▇▇▇▇ is a member for any Post-Closing Tax Period without the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentprior written consent of Buyer, which consent may shall not be unreasonably withheld, conditioned or delayed. Neither Seller, to nor any settlement to Affiliate of Seller, shall file an amended Tax Return that may increase the extent such settlement would affect liability for Taxes of ▇▇▇▇ for any Post-Closing Tax Period without the amount prior written consent of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consentBuyer, which consent may shall not be unreasonably withheld, conditioned or delayed. For the avoidance of doubt, unless otherwise authorized by Seller in writing, only Seller is authorized to file any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or Tax return respecting ▇▇▇▇ and any of its Subsidiaries; providedSubsidiaries for any pre-Closing Tax period, however, that, including the portion of the Tax year ending on the Closing Date. Buyer and Seller shall jointly control all proceedings taken in the case of a connection with any Tax Claim with respect Claims relating solely to a Straddle Period, Seller Period of ▇▇▇▇ and each party shall bear its own out-of-pocket costs and expenses of the contest and all joint costs and expenses of the contest shall be entitled to participate borne in such proceeding (at its sole cost and expense) to the extent such same ratio as the applicable proposed Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not would be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementallocated.
Appears in 1 contract
Sources: Stock Purchase Agreement (Cardiotech International Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes The Purchaser will promptly notify the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall in -------- writing upon receipt by the Purchaser, any of its Affiliates or the Company of notice of such Tax Claimany pending or threatened federal, promptly inform state, local or foreign income or franchise tax audits or assessments which may materially affect the tax liabilities of the Company for which the Seller in writing; provided, however, that failure would be required to give such notice as provided herein shall not relieve indemnify the Purchaser pursuant to Section 4.08(A). The Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall will have the right to elect to control --------------- represent the defense of Company's interests in any Tax Claim tax audit or administrative or court proceeding relating to taxable periods ending on or before the Closing Date, and to employ counsel of its choice at its own expense. Nonetheless, the Seller shall not be entitled to settle any claim for Taxes that would materially adversely affect the liability for Taxes of the Purchaser or otherwise relating any of the Companies for any period after the Closing Date without the prior written consent of the Purchaser (which consent shall not be unreasonably withheld or delayed, but will not be required to Taxes for which the extent that the Sellers have indemnified the Purchaser against the effects of any such settlement). The Seller may will be liable under this Agreement (other than with respect entitled to a Straddle Period)participate, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and own expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance claim for Taxes for a year or period ending after the Closing Date that may be the subject of indemnification by the Seller pursuant to Section 4.08(A) and, with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised the written consent of the status Purchaser (which consent --------------- shall not be unreasonably withheld or delayed), and at its sole expense, may assume the entire defense of such tax claim. Neither the Purchaser nor the Company may agree to settle any tax claim for the portion of the Tax Claim and year or period ending on the defense thereof and Closing Date that may be the subject of indemnification by the Seller under Section 4.08(A) without the prior written consent of the Seller, --------------- which consent shall reasonably consider recommendations made not be unreasonably withheld or delayed. In addition, the Seller will promptly notify the Purchaser in writing upon receipt by the Seller or any of its subsidiaries, including the Company, of notice of any pending or threatened federal, state, local or foreign income or franchise tax audits or assessments which may materially affect the tax liabilities of the Company for which the Purchaser with respect thereto and would be liable pursuant to Section 4.08(A) or (ii) B). The Purchaser shall will have the right to consentrepresent the ---------------------- Company's interests in any tax audit or administrative or court proceeding relating to taxable periods ending on or before the Closing Date, and to employ counsel of its choice at its own expense. Nonetheless, the Purchaser shall not be entitled to settle any claim for Taxes that would materially adversely affect the liability for Taxes of the Seller or the Company for any period after the Closing Date without the prior written consent of the Seller (which consent may shall not be unreasonably withheld, conditioned withheld or delayed). The Purchaser will be entitled to participate, to at its own expense, in the defense of any settlement to the extent such settlement would affect the amount of claim for Taxes for which Purchaser a year or its Affiliates may be liable for taxable periods period ending after the Closing Date. If Date for which the Purchaser may be liable pursuant to Section 4.08(A) or (B) ---------------------- and, with the written consent of the Seller elects (which consent shall not to control be unreasonably withheld or delayed), and at its sole expense, may assume the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the entire defense of such Tax Claims at tax claim. Neither the Seller nor any of its sole cost and expensesubsidiaries may agree to settle any tax claim for the portion of the year or period ending on the Closing Date for which the Purchaser may be liable pursuant to Section 4.08(A) or (B) without the prior written consent of the Purchaser, and Seller shall have the right to consent, ---------------------- which consent may shall not be unreasonably withheld, conditioned withheld or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Sellers' Representative in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding of the Purchaser or any of the Company and the Subsidiaries which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingArticle VII; provided, however, that the failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser's right to indemnification under this Article V VII except to the extent extent, if any, that, but for such failure, the Sellers could have avoided all or a portion of the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right relates to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable provided that the Sellers acknowledge in writing their liability under this Agreement to hold the Purchaser and its Affiliates, the Company and the Subsidiaries harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding that relates to periods ending on or before the Closing Date (other than with respect or, in the case of any taxable year that includes the Closing Date, against an adjustment allocable under Section 7.01(b) to a Straddle Periodthe portion of such year ending on or before the Closing Date), the Sellers' Representative shall have the right at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Seller. If Seller timely elects audit or proceeding, but only to control the extent that such audit or proceeding relates solely to a potential adjustment for which the Sellers have acknowledged their liability; the Purchaser also may participate in any such audit or proceeding and, if the Sellers' Representative does not assume the defense of any such Tax Claim audit or proceeding, the Purchaser may defend the same in accordance such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding after 20 days' prior written notice to the Sellers' Representative setting forth the terms and conditions of settlement. In the event that issues relating to a potential adjustment for which the Sellers have acknowledged their liability are required to be dealt with in the same proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit proceeding with respect to the latter issues.
(c) With respect to issues relating to a potential adjustment for which both the Sellers (as evidenced by their acknowledgement under this Section 5.067.03) and the Purchaser or the Company or any Subsidiary could be liable, (i) Seller shall keep both Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto Sellers' Representative may participate in the audit or proceedings, and (ii) the audit or proceedings shall be controlled by that party which would bear the burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the immediately preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (including, without limitation, choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article VII by the Purchaser and the Sellers Representative.
(d) Neither the Purchaser nor the Sellers shall have enter into any compromise or agree to settle any claim pursuant to any Tax audit or proceeding which would adversely affect the right to other party for such year or a subsequent year without the written consent of the other party (which consent, in the case of the Sellers, shall be given by the Sellers' Representative on behalf of all the Sellers), which consent may not be unreasonably withheld, conditioned or delayed, . The Purchaser and the 40 50 Sellers agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Purchaser agrees to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to cause the Company or any of its Subsidiaries; provided, however, thatand the Subsidiaries to cooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned any audit or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (a) After the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Closing Date, Purchaser shall upon receipt promptly notify Seller, or Seller, CLAC, or FGWLA shall promptly notify Purchaser, in writing of any written notice of such a proposed assessment, audit, examination or claim in a Tax ClaimContest of or relating to Purchaser, promptly inform Seller, the Seller in writingSubsidiaries, the Transferred Assets or the Business which, if determined adversely to the taxpayer, would be grounds for indemnification under this Article XII; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller affect the rights of its obligations a party to indemnification under this Article V Agreement except to the extent extent, (i) if any, that, but for such failure, the Tax Indemnifying Party could have avoided all or a portion of the Tax liability in question or (ii) such failure otherwise actually materially prejudices the Tax Indemnifying Party.
(b) In the case of a Tax Contest that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating (i) relates to taxable periods ending on or before the Closing Date, Date or otherwise relating (ii) relates to a liability for Taxes for which Seller may be liable under is reasonably likely to indemnify Purchaser or the Seller Subsidiaries pursuant to this Agreement (other than with respect to a Straddle Period)or the Ancillary Agreements, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right at its expense to consentparticipate in, control the conduct of, and, subject to Purchaser’s consent pursuant to Section 12.04(c), settle such Tax Contest. Purchaser shall control all other Tax Contests and have the right to participate in all Tax Contests (including with respect to which Seller possesses the right to control) which are reasonably likely to result in an adverse material effect to Purchaser, any Affiliate of Purchaser or the Seller Subsidiaries.
(c) None of Purchaser, the Seller Subsidiaries or any Affiliate of either, nor Seller or any Affiliate of Seller, shall enter into any compromise or agree to settle any claim pursuant to any Tax Contest which would adversely affect the other party for any year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . Purchaser and Seller agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensereasonably cooperate, and Purchaser agrees to cause the Seller shall have the right Subsidiaries to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatreasonably cooperate, in the case defense against or compromise of a any Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 1 contract
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Sellers’ Representative in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding of the Purchaser or any Company or Subsidiary which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingArticle VI; provided, however, that the failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser’s right to indemnification under this Article V VI except to the extent extent, if any, that, but for such failure, the Sellers could have avoided all or a portion of the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Date, or otherwise relating provided that, and only to Taxes for which Seller may be liable the extent that, the Sellers acknowledge in writing their liability under this Agreement (other than to hold the Purchaser, the Companies and the Subsidiaries harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding, the Sellers’ Representative shall have the right at his expense to participate in and control the conduct of such audit or proceeding; the Purchaser also may participate in any such audit or proceeding at its own expense and, if the Sellers’ Representative does not assume the defense of any such audit or proceeding, the Purchaser may defend the same in such manner as it may deem appropriate, including settling such audit or proceeding after fifteen days prior written notice to the Sellers’ Representative setting forth the terms and conditions of settlement. Notwithstanding anything to the contrary contained in Section 7.05, in the event that issues relating to a potential adjustment for which the Sellers have acknowledged liability are required to be contested in the same audit or proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit or proceeding with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereofthe latter issues; provided, however, that the Purchaser may, at its sole cost and expense, retain separate counsel of its choosing shall not have the right to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of settle any such Tax Claim matter without the consent of the Sellers’ Representative, which consent shall not be unreasonably withheld.
(c) Notwithstanding anything to the contrary contained in accordance Section 6.04, with respect to issues relating to a potential adjustment for which both the Sellers (as evidenced by their written acknowledgement under this Section 5.066.04) and the Purchaser or any Company or Subsidiary could be liable, (i) Seller shall keep Purchaser reasonably apprised of both the status of the Tax Claim Sellers’ Representative and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and may participate in the audit or proceeding; (ii) the audit or proceeding shall be controlled by that party which would bear the burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future taxable periods; and (iii) the controlling party shall not settle any such matter without the consent of the non-controlling party (which consent shall not be unreasonably withheld). The principle set forth in this Section 6.04(c) also shall govern for purposes of deciding any issue that must be decided jointly (including choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article VI by the Purchaser and the Sellers’ Representative.
(d) With respect to any Tax audit or proceeding for a taxable period that begins before the Closing Date, neither the Purchaser nor the Sellers’ Representative shall have enter into any compromise or agree to settle any claim pursuant to such audit or proceeding which would adversely affect the right to consentother party for such taxable period or a subsequent taxable period without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . The Purchaser and the Sellers’ Representative agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Purchaser agrees to consent, which consent may not be unreasonably withheld, conditioned or delayed, cause the Companies and the Subsidiaries to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatcooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in any such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned audit or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Sources: Stock Purchase Agreement (Lincoln Educational Services Corp)
Contests. Whenever (a) After the Closing, Purchaser shall -------- promptly notify Seller in writing of the commencement of any Taxing Authority asserts Tax audit or administrative or judicial proceeding or of any demand or claim on Purchaser or any Company which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification under Section
7.01. Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. If Purchaser fails to give Seller prompt notice of an asserted Tax liability as required by this Section 7.03, then (a) if Seller is precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then Seller shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (b) if Seller is not so precluded from contesting but such failure to give prompt notice results in a claimdetriment to Seller, makes an assessment, or then any amount which Seller is otherwise disputes required to pay Purchaser pursuant to
Section 7.01 with respect to such liability shall be reduced by the amount of Taxes such detriment.
(b) Seller may elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought under Section 7.01 (any such audit, claim for refund or proceeding relating to an asserted Tax liability is referred to herein as a "Contest"). If Seller elects to direct a Contest, it shall within 30 days of -------- receipt of the notice of asserted Tax liability notify Purchaser of its intent to do so, and Purchaser shall cooperate and shall cause each Company to cooperate, at the expense of Seller, in each phase of such Contest. Seller shall keep Purchaser informed regarding the progress but not any substantive aspect of any Contest which Seller may reasonably be expected has elected to be liable direct. If Seller elects not to direct the Contest, fails to notify Purchaser of its election as herein provided or contests its obligation to indemnify under this Agreement (a “Tax Claim”)Section 7.01, Purchaser shall upon receipt or the relevant Company may pay, compromise or contest, at its own expense, such asserted liability. However, in such case, neither Purchaser nor such Company may settle or compromise any asserted liability over the objection of notice of such Tax Claim, promptly inform Seller in writingSeller; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve be -------- ------- unreasonably withheld. In any event, Seller may participate, at its own expense, in the Contest. If Seller chooses to direct the Contest, Purchaser shall promptly empower and shall cause the relevant Company promptly to empower (by power of its obligations under this Article V except attorney and such other documentation as may be appropriate) such representatives of Seller as it may designate to represent Purchaser and such Company in the extent that Seller is materially prejudiced thereby. Seller shall have Contest insofar as the right to elect to control the defense of any Contest involves an asserted Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes liability for which Seller may would be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement7.01.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (a) After the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Closing Date, Purchaser shall upon receipt promptly notify Seller, or Seller, CLAC, or FGWLA shall promptly notify Purchaser, in writing of any written notice of such a proposed assessment, audit, examination or claim in a Tax ClaimContest of or relating to Purchaser, promptly inform Seller, the Seller in writingSubsidiaries, the Transferred Assets or the Business which, if determined adversely to the taxpayer, would be grounds for indemnification under this Article XII; providedprovided , howeverhowever , that a failure to give such notice as provided herein shall will not relieve Seller affect the rights of its obligations a party to indemnification under this Article V Agreement except to the extent extent, (i) if any, that, but for such failure, the Tax Indemnifying Party could have avoided all or a portion of the Tax liability in question or (ii) such failure otherwise actually materially prejudices the Tax Indemnifying Party.
(b) In the case of a Tax Contest that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating (i) relates to taxable periods ending on or before the Closing Date, Date or otherwise relating (ii) relates to a liability for Taxes for which Seller may be liable under is reasonably likely to indemnify Purchaser or the Seller Subsidiaries pursuant to this Agreement (other than with respect to a Straddle Period)or the Ancillary Agreements, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right at its expense to consentparticipate in, control the conduct of, and, subject to Purchaser’s consent pursuant to Section 12.04(c), settle such Tax Contest. Purchaser shall control all other Tax Contests and have the right to participate in all Tax Contests (including with respect to which Seller possesses the right to control) which are reasonably likely to result in an adverse material effect to Purchaser, any Affiliate of Purchaser or the Seller Subsidiaries.
(c) None of Purchaser, the Seller Subsidiaries or any Affiliate of either, nor Seller or any Affiliate of Seller, shall enter into any compromise or agree to settle any claim pursuant to any Tax Contest which would adversely affect the other party for any year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . Purchaser and Seller agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensereasonably cooperate, and Purchaser agrees to cause the Seller shall have the right Subsidiaries to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatreasonably cooperate, in the case defense against or compromise of a any Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 1 contract
Sources: Asset and Stock Purchase Agreement (Great West Life & Annuity Insurance Co)
Contests. Whenever (a) After the Closing Date, Buyer shall promptly notify Seller in writing of any Taxing Authority asserts proposed assessment, the commencement of any audit or court proceedings or of any demand or claim on a Tax Indemnitee which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification by Seller under Section 10.3 (each such assessment, audit, court proceeding, demand or claim, makes an assessmenta “Contest”); provided that the failure so to notify Seller shall not relieve Seller of any liability that it may have to the Tax Indemnitee hereunder, or otherwise disputes except to the amount of Taxes for which extent that Seller may reasonably be expected to be liable under this Agreement demonstrates that it is actually prejudiced thereby. Such notice (a “Tax Claim”), Purchaser ) shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except contain factual information (to the extent known to Buyer) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability.
(b) In the case of any Contest that Seller is materially prejudiced thereby. relates to a taxable period ending on or prior to the Closing Date, Seller shall have the right to elect right, at its expense and through counsel of its own choosing, to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement conduct of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, Contest; provided that (i) Seller shall keep Purchaser reasonably apprised of the status of does not dispute its obligation to indemnify the Tax Claim and Indemnitees for the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and asserted liability, (ii) Purchaser Seller shall have consult with the right Buyer regarding any such Contest and shall allow Buyer to consent, participate in any such proceeding and (iii) no settlement or other disposition of any claim for Tax which consent may not be unreasonably withheld, conditioned or delayed, to would adversely affect any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for Tax Indemnitee in any taxable periods period ending after the Closing DateDate in any manner or to any extent (including, but not limited to, the imposition of income tax deficiencies, the reduction of asset basis or cost adjustments and the reduction of loss or credit carryovers) shall be agreed to without Buyer’s prior written consent, such consent not to be unreasonably withheld or delayed, unless Buyer agrees to indemnify the Seller for any increase in Taxes resulting from a failure to provide consent. If Seller elects not to direct the Contest, Buyer or the Company may pay, compromise, or contest such asserted liability.
(c) In the case of a Contest that relates to a taxable period beginning before the Closing Date and ending after the Closing Date, Buyer shall have the right, at its expense and through counsel of its own choosing, to control the defense or thereafter fails or ceases to defend conduct of such Contest; provided that (i) Buyer shall consult with Seller regarding any such Tax ClaimContest and shall allow Seller to participate in any such proceeding and (ii) no settlement or other disposition of any claim for Taxes which would adversely affect Seller in such taxable periods or subsequent taxable periods shall be agreed to without Seller’s prior written consent, Purchaser such consent not to be unreasonably withheld or delayed, unless Seller agrees to indemnify the Buyer for any increase in Taxes resulting from a failure to provide consent. Except as provided above, the Buyer shall have the right to control the defense conduct of such Tax Claims at any Contest in its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or discretion with respect to any other Tax matter.
(d) Seller, Buyer and the Company or any of its Subsidiaries; provided, however, that, agree to cooperate in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany Contest.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except Subject to the extent that Seller is materially prejudiced thereby. Seller rights of insurers under policies of -------- insurance maintained pursuant to Section 16 of the Charter, the Charterer shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser mayright, at its sole cost and expense, retain separate counsel to investigate, and the right in its sole discretion to defend or compromise, any Claim for which indemnification is sought under this Section 13.1, and the Indemnitee shall cooperate, at the Charterer's expense, with all reasonable requests of its choosing to participate the Charterer in connection therewith. The Charterer will provide the Indemnitee with such information not within the control of such Indemnitee, as is in the defense Charterer's control or settlement is reasonably available to the Charterer, which such Indemnitee may reasonably request and shall otherwise cooperate with such Indemnitee so as to enable such Indemnitee to fulfill its obligations under this Section 13.
1. Where the Charterer or the insurers under a policy of such Tax Claim insurance maintained by Seller. If Seller timely elects to control the Charterer undertake the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser an Indemnitee with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax a Claim, Purchaser shall have the right to control no additional legal fees or expenses of such Indemnitee in connection with the defense of such Tax Claims claim shall be indemnified hereunder unless such fees or expenses were incurred at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned request of the Charterer or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiariesinsurers; provided, however, thatthat if (i) in the written opinion of counsel to such -------- ------- Indemnitee an actual or potential material conflict of interest exists where it is advisable for such Indemnitee to be represented by separate counsel or (ii) such Indemnitee has been indicted or otherwise charged in a criminal complaint in connection with a Claim not excluded by Section 13.1(a) and such Indemnitee informs the Charterer that such Indemnitee desires to be represented by separate counsel, the reasonable fees and expenses of such separate counsel shall be borne by the Charterer. Subject to the requirements of any policy of insurance, an Indemnitee may participate at its own expense in any judicial proceeding controlled by the Charterer pursuant to the preceding provisions; provided that -------- such party's participation does not, in the case reasonable opinion of the independent counsel appointed by the Charterer or its insurers to conduct such proceedings, significantly interfere with such control; and such participation shall not constitute a waiver of the right to receive the indemnification provided in this Section 13.1. Notwithstanding anything to the contrary contained herein, (x) the Charterer shall not under any circumstances be liable for the fees and expenses of more than one counsel for each of (i) the Owner Participant, the Owner Trustees and the Owner Trust (and their respective successors and permitted assigns, agents and servants) and (ii) the Loan Participants and the Indenture Trustee (and their respective successors and permitted assigns, agents and servants), and (y) during the continuance of a Tax Claim with respect to a Straddle Periodspecified Charter Event of ---------------- Default, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser Charterer shall not settle such portion of such Tax compromise any Claim without the Seller’s consentconsent of the ------- applicable Indemnitee, which such consent may not to be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Sources: Participation Agreement (Mobil Corp)
Contests. Whenever (a) After the Closing, Acquirer and the Shareholders shall promptly notify each other in writing of any Taxing Authority asserts a claimdemand or claim received by the Shareholders, makes an assessment, Acquirer or otherwise disputes the amount of Target from any Tax authority or other party with respect to Taxes for which Seller the Shareholders are liable pursuant to Section 12.01(a). Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability.
(b) The Shareholders (or their designee) may reasonably elect to control the conduct, through counsel of its own choosing and at its own expense, of any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be expected sought under Section 12.01(a) (any such audit, claim for refund or proceeding relating to be liable under this Agreement an asserted Tax liability is referred to herein as a "Contest "). If the Shareholders (or their designee) elect to control a “Tax Claim”)Contest, Purchaser it shall upon within 20 calendar days of receipt of the notice of asserted Tax liability notify Acquirer of its intent to do so, and the Shareholders (or their designee) shall have all rights to settle, compromise and/or concede such Tax Claim, promptly inform Seller in writingasserted liability; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller Acquirer shall have the right to consult with the Shareholders regarding any Contest that may affect the Acquirer or Target for any Post-Closing Period and provided further that the Shareholders shall not have the right to settle, compromise and/or concede any Contest that may affect the Acquirer or Target for any period after the Closing Date without Acquirer's prior written consent, which consent shall not be unreasonably withheld. If the Shareholders elect not to control the defense Contest or fails to notify Acquirer of any Tax Claim relating to taxable periods ending on its election as herein provided, Acquirer may pay, compromise or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period)contest, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and own expense, retain separate counsel of its choosing subject to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of reimbursement by the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto Shareholders for reasonable third party expenses and (ii) Purchaser the Shareholders' indemnification obligations under Section 12.01(a). Acquirer shall have the sole right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to represent Target in any settlement to other Contest.
(c) In the extent such settlement would affect event that the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending Shareholders shall after the Closing Date. If Seller elects take any position in any Tax Return, or reach any settlement or agreement on audit, which is in any manner inconsistent with any position taken by the Target in any filing, settlement or agreement made by Target prior to the Closing and such inconsistent position (i) requires the payment by Acquirer or Target of more Tax than would have been required to be paid had such position not been taken or such settlement or agreement not been reached, (ii) affects the determination of useful life, basis or method of depreciation, amortization or accounting of any of the assets or properties of Target or (iii) accelerates the time at which any Tax must be paid by Acquirer or Target, then the Shareholders, in each such case, shall provide timely and reasonable notice to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense Acquirer of such position and shall indemnify Acquirer and hold it harmless from any Tax Claims at its sole liability or Tax cost and expenseor any Related Costs arising from, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned in connection with or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementposition.
Appears in 1 contract
Sources: Merger Agreement (National Medical Health Card Systems Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under (a) Nothing in this Agreement shall be construed to prevent UpREIT from contesting, through its Tax Matters Partner in accordance with the Partnership Agreement as part of the unified audit of the UpREIT, any claim in respect of any "partnership" item of the UpREIT that, if successful, would result in an Income Inclusion (a “Tax Claim”"Partnership Level Issue").
(b) If UpREIT contests a Partnership Level Issue that, if successful, would result in an Income Inclusion, UpREIT's liability for indemnification under Section 4 hereof (other than reasonable costs and expenses described in Section 6(f) of the Agreement) shall, at UpREIT's election, be deferred until thirty (30) days after a Final Determination of such ▇▇▇▇▇ Indemnitee's federal income tax liability in respect of an Income Inclusion.
(c) If any audit or proceeding involving an indemnifiable adjustment is being conducted in a proceeding involving such ▇▇▇▇▇ Indemnitee, which cannot be transferred to the UpREIT as a partnership item (a "▇▇▇▇▇ Level Issue"), Purchaser shall upon receipt of notice such ▇▇▇▇▇ Indemnitee hereby agrees (i) promptly to notify UpREIT in writing of such adjustment (and the failure of such ▇▇▇▇▇ Indemnitee to so notify UpREIT shall preclude any indemnity hereunder to the extent UpREIT's right to effect its contest rights hereunder has been precluded by such failure), and (ii) upon UpREIT's delivery to of a written opinion of nationally recognized tax counsel reasonably acceptable to such ▇▇▇▇▇ Indemnitee ("Tax ClaimCounsel") to the effect that there is a Realistic Possibility of Success upon contest of such ▇▇▇▇▇ Level Issue, promptly inform Seller such ▇▇▇▇▇ Indemnitee will contest that adjustment by filing a protest and administrative appeal and prosecuting the same in writinggood faith; provided, however, that such ▇▇▇▇▇ Indemnitee will not be obligated to pursue an administrative appeal if such ▇▇▇▇▇ Indemnitee instead pursues relief in Tax Court or a court having refund jurisdiction.
(d) If, within 30 days following the failure to give of such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than administrative proceedings with respect to a Straddle Period▇▇▇▇▇ Level Issue, UpREIT delivers to a ▇▇▇▇▇ Indemnitee a written opinion of Tax Counsel to the effect that there is a Realistic Possibility of Success if the proposed adjustment is presented to a court for resolution, then such ▇▇▇▇▇ Indemnitee will contest the proposed adjustment in good faith in the Tax Court or by paying the tax (and any applicable interest and penalties) and suing for refund in the Court of Federal Claims or appropriate Federal District Court. If, within 30 days following a final adverse decision of such court with respect to such ▇▇▇▇▇ Level Issue, UpREIT delivers to such ▇▇▇▇▇ Indemnitee a written opinion of Tax Counsel to the effect that it is more likely than not that such decision would be reversed on appeal, then such ▇▇▇▇▇ Indemnitee will appeal such decision to the appropriate Federal Court of Appeals. With respect to any of the above-described proceedings, such ▇▇▇▇▇ Indemnitee will keep UpREIT and its counsel informed as to the progress of such proceedings, give UpREIT and its counsel the opportunity to review and comment in advance on all written submissions and filings relevant to indemnifiable issues (after making appropriate redactions to preserve the confidentiality of the such ▇▇▇▇▇ Indemnitee return as to other issues), at and consider in good faith any suggestions made by UpREIT or its sole cost and expense by written notice counsel.
(e) Such ▇▇▇▇▇ Indemnitee shall present any settlement offer provided to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing such ▇▇▇▇▇ Indemnitee pursuant to participate in the defense or settlement of such Tax Claim by Sellera ▇▇▇▇▇ Level Issue to UpREIT. If Seller timely elects UpREIT recommends acceptance of a settlement offer of a ▇▇▇▇▇ Level Issue or if the Tax Matters Partner recommends acceptance of a settlement offer in respect of a Partnership Level Issue, but such ▇▇▇▇▇ Indemnitee declines to control accept such offer in writing within 30 days (if such ▇▇▇▇▇ Indemnitee does not respond within 30 days, such lack of response shall be treated as acceptance of UpREIT's or the defense Tax Matters Partner's recommendation, respectively), (1) the obligation of UpREIT to make indemnity payments as the result of any such contest or proceedings shall not thereafter exceed the obligation that it would have had if such contest had been settled or proceeding terminated on the basis recommended by UpREIT or the Tax Claim Matters Partner, as applicable, and (2) in accordance the case of a ▇▇▇▇▇ Level Issue, UpREIT shall have no further liability for costs or other expenses in respect of such contest.
(f) Notwithstanding the foregoing, such ▇▇▇▇▇ Indemnitee will have no obligation to contest any action with this Section 5.06, respect to a ▇▇▇▇▇ Level Issue (i) Seller shall keep Purchaser reasonably apprised unless such items could give rise to a federal income tax liability (disregarding other items in the assessment and considering effects in future years) in excess of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and $__________ , (ii) Purchaser shall have the right to consentwithout UpREIT paying when due, which consent may not be unreasonably withheldreasonable third-party costs and out-of-pocket expenses including reasonable legal, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost witness and expense, accounting fees and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatother expenses and, in the case of a Tax Claim with respect to a Straddle Periodproceedings before the Court of Federal Claims or Federal District Court, Seller shall be entitled to participate in such proceeding the amount of tax (at its sole cost and expenseany applicable interest and penalties) for which refund is claimed, and (iii) to the extent such Tax Claim is related ▇▇▇▇▇ Indemnitee waives in writing UpREIT's obligation to the portion of indemnify such Straddle Period that is a Pre▇▇▇▇▇ Indemnitee for such items, in which case all third-Closing Tax Period, party costs and Purchaser out-of-pocket expenses described in clause (ii) thereafter incurred and all taxes would be paid by such ▇▇▇▇▇ Indemnitee.
(g) such ▇▇▇▇▇ Indemnitee shall not settle any such portion of ▇▇▇▇▇ Level Issue without UpREIT's consent; provided that such Tax Claim without the Seller’s consent, which consent may ▇▇▇▇▇ Indemnitee shall not be unreasonably withheld, conditioned or delayed, required to contest any proposed adjustment and may settle any such proposed adjustment if such settlement would affect ▇▇▇▇▇ Indemnitee shall waive its right to indemnity under this Agreement with respect to such adjustment and any Income Inclusion that results from such adjustment and, in the case of proceedings before the Court of Federal Claims or Federal District Court, shall pay to UpREIT the amount of Taxes for which Seller may be liable tax (and any applicable interest and penalties) previously paid or advanced by UpREIT with respect to such adjustment or the contest of such adjustment under this AgreementSection 6(f), plus interest at ___% computed from the time such amounts were paid or advanced by UpREIT.
(h) Within thirty (30) days after a Final Determination of the liability of such ▇▇▇▇▇ Indemnitee in respect of a ▇▇▇▇▇ Level Issue, UpREIT and each Indemnitee agree to pay each other, as applicable, the net amount of (i) the payment owed by the UpREIT to such ▇▇▇▇▇ Indemnitee of any indemnification hereunder, not theretofore paid resulting from the outcome of such contest, and (ii) in the case of proceedings before the Court of Federal Claims or Federal District Court, the repayment owed by such ▇▇▇▇▇ Indemnitee to UpREIT of the amount of tax (and any applicable interest and penalties) previously paid or advanced by UpREIT with respect to such adjustment or the contest of such adjustment under Section 6(f), together with any interest received by or credited to such ▇▇▇▇▇ Indemnitee that is attributable to such advance.
Appears in 1 contract
Sources: Tax Indemnification Agreement (Prime Group Realty Trust)
Contests. Whenever (a) The Indemnitee shall notify the Indemnitor in writing promptly, and in any Taxing Authority asserts a claimevent within thirty (30) days, makes an assessmentof becoming aware of the commencement after the Closing Date of any audit or administrative or judicial proceeding, or otherwise disputes of any demand or claim on the amount Indemnitee or any of Taxes its Affiliates, which could give rise to a claim for which Seller may reasonably be expected indemnification under
Section 7.01 (an “Indemnification Event”). Such notice shall contain factual information (to the extent known to the Indemnitee or its Affiliates) with respect to the Indemnification Event in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect thereof. If, in breach of its obligations hereunder, the Indemnitee fails to give the Indemnitor notice of an Indemnification Event, the Indemnitor shall not be liable under this Agreement for such claim to the extent, if any, that the rights of the Indemnitor with respect to such claim are actually prejudiced or the amount of Tax which the Indemnitor would be required to indemnify is increased by such breach.
(b) Subject to Section 7.03(d), the Indemnitor may elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any Taxes for which indemnity could be sought from the Indemnitor under Section 7.01 (any such audit, claim for refund or proceeding is referred to herein as a “Tax ClaimContest”). If the Indemnitor elects to direct a Contest, Purchaser it shall upon promptly notify the Indemnitee of its intent to do so and in any event within sixty (60) days of receipt of the notice of the Indemnification Event relating to such Contest and, if requested by the Indemnitee, the Indemnitor shall furnish to the Indemnitee in due course, as a condition to further pursuing such Contest, an opinion of the Indemnitor’s independent tax counsel to the effect that the Indemnitor will more likely than not win such Contest. In the case of any Contest, the Indemnitee and each of its Affiliates, as the case may be, shall give to the Indemnitor any information reasonably requested by the Indemnitor relating to such Contest and otherwise shall cooperate with the Indemnitor in good faith in order to contest effectively any such Contest. The Indemnitor shall, on demand, reimburse all “out of pocket” costs and expenses which the Indemnitee or its Affiliate may incur in connection with such Contest (but not in connection with exercising the right of attendance described below), including reasonable attorneys’ and accountants’ fees and disbursements. The Indemnitee or its duly appointed representatives shall be allowed to attend all meetings between the Indemnitor and the taxing authority in question and shall be provided with copies of all material correspondence and documents relating to such Contest. If the Indemnitor fails to notify the Indemnitee of its election as herein provided, the Indemnitee and each of its Affiliates, as applicable, may take such reasonable steps as may be prudent and within its capacity to preserve the right of the relevant entity to contest such asserted Tax Claimliability, promptly inform Seller may pay, compromise or contest, such asserted Tax liability and shall be reimbursed by the Indemnitor for all “out of pocket” costs and expenses, including reasonable attorneys’ and accountants’ fees and disbursements incurred pursuant to this sentence to the extent attributable to a Tax liability indemnifiable by the Indemnitor hereunder. However, in writingeach such case, neither the Indemnitee nor any of its Affiliates may settle or compromise any asserted Tax liability without the consent of the Indemnitor; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller be unreasonably withheld or delayed. If the Indemnitor chooses to direct the Contest, the Indemnitee shall promptly empower and shall cause each of its obligations under this Article V except Affiliates, as applicable, promptly to empower (by power of attorney and such other documentation as may be necessary and appropriate) such representatives of the extent that Seller is materially prejudiced thereby. Seller shall have Indemnitor as it may designate to represent the right to elect to control Indemnitee and any relevant Affiliate in the defense of any Contest insofar as the Contest involves an asserted Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes liability for which Seller may the Indemnitor could be liable under this Agreement Section 7.01.
(other c) Subject to making any payment or deposit as may be required by Law as a precondition to pursuing any judicial determination, the Indemnitor may cause a Contest to be prosecuted to a determination in a court of initial jurisdiction, and if the Indemnitor shall have furnished the Indemnitee with an opinion of the Indemnitor’s independent tax counsel to the effect that the Indemnitor will more likely than not successfully appeal the determination of any court, the Indemnitor may cause such Contest to be prosecuted to a determination in an appellate court.
(d) Nothing contained herein shall permit the Indemnitor to control any such Contest, if the Indemnitee and each of its Affiliates, as applicable, shall waive the payment by the Indemnitor of any amount that might otherwise be payable by the Indemnitor hereunder by way of indemnity in respect to such Contest. Upon any such waiver, the Indemnitee shall repay to the Indemnitor any payments made by the Indemnitor to any taxing authority in such Contest (together with interest, from the date the payment to the taxing authority was made by the Indemnitor to the date of repayment by the Indemnitee, at the statutory rate which shall be applicable from time to time with respect to a Straddle Perioddeficiencies for the Taxes in question), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever (i) After the Closing, Purchaser shall promptly notify the Seller Representative in writing of any Taxing Authority asserts a claimdemand, makes an assessmentclaim or notice received by Purchaser or any Affiliate thereof (including the Company) from any Governmental Body or any other Person relating to the commencement of any Tax-related action, audit, claim for refund, or otherwise disputes administrative or judicial proceeding (each, a “Tax Action”) to the amount extent such Tax Action relates to (each, a “Seller Tax Action”) (x) a Pass-Through Income Tax Return for any period (or portion thereof) during which any Seller held an interest in the Company or (y) any Tax Action the resolution or outcome of Taxes for which could result in any Tax or related Liability, damage or loss due or payable by any Seller may reasonably be expected to be liable under any Governmental Body or Purchaser (or any of its Affiliates) pursuant to this Agreement (a Section 7.4(h)) (each, an “Other Tax ClaimAction”), Purchaser . Such notice shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except contain factual information (to the extent known) describing the asserted Tax liability and shall include copies of any notice or other document received from any Governmental Body or any other Person in respect of any such asserted Tax liability.
(ii) The Seller Representative shall have the right (at its election and at its own expense and by the counsel and representatives of its own choosing) to control the defense and resolution all Seller Tax Actions by providing written notice to the Purchaser. With respect to any Seller Tax Action controlled by the Seller Representative, (i) the Seller Representative may not settle any Seller Tax Action without the prior written consent of Purchaser (which consent Purchaser will not be unreasonably withhold, conditioned or delayed), (ii) the Seller Representative will keep Purchaser reasonably informed of all material communications with any Governmental Body, and (iii) with respect to any Seller Tax Action that is an Other Tax Action or which is reasonably likely to result in any Tax imposed directly on the Company, Purchaser (at its sole expense) may passively participate in (but not control or otherwise settle or resolve) such Seller Tax Action. The Seller Representative will have the right to participate (at its sole expense) in any proceeding with respect to Tax Action that Seller is materially prejudiced therebyRepresentative does not elect to control pursuant to this Section 7.4(d) or that Seller ceases to control (each, a “Purchaser Controlled Action”). Purchaser shall control the conduct of such Purchaser Controlled Action, but Seller shall have the right to elect to control participate in such Purchaser Controlled Action at its own expense and, with the defense written consent of any Tax Claim relating to taxable periods ending on or before the Closing DatePurchaser, or otherwise relating to Taxes for which in Purchaser’s sole discretion, and at its expense, Seller may be liable under this Agreement assume control of the conduct of such Tax Action. Purchaser shall not (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10shall not cause or permit) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense resolution or settlement of such Tax Claim by Seller. If Seller timely elects to control any Purchaser Controlled Action without the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised prior written consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and Seller Representative (ii) Purchaser shall have the right such consent not to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement ). Notwithstanding anything to the extent contrary in the foregoing provisions, if Purchaser fails to assume control of the conduct of any such settlement would affect Purchaser Controlled Action within a reasonable period following the amount receipt by Purchaser of Taxes for which Purchaser notice of such Tax Action or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend or contest any such Tax ClaimAction in good faith or by appropriate proceeds, Purchaser the Seller Representative shall have the right (but not the obligation) to assume control the defense of such Tax Claims at Action and shall be able to settle, compromise and/or concede such Tax Action in its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementdiscretion.
Appears in 1 contract
Contests. Whenever (a) After the Closing, each of the Buyers and the Sellers shall promptly notify the other in writing of any Taxing Authority asserts written notice of a claim, makes an proposed assessment, reassessment, or otherwise disputes claim in an audit or administrative or judicial proceeding which, if determined adversely to the amount of Taxes taxpayer, would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”)Article 8, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the indemnified party's right to indemnification under this Article V 8 except to the extent extent, if any, that, but for such failure, the indemnified party could have avoided all or a portion of the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding with respect to the US Company that Seller is materially prejudiced thereby. Seller shall have the right relates to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable provided that the Sellers acknowledge in writing their liability under this Agreement to hold the Buyers and the US Company harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding that relates to periods ending on or before the Closing Date (other than with respect or, in the case of any taxable year that includes the Closing Date, against an adjustment allocable under Section 8.1(b) to a Straddle Periodthe portion of such year ending on or before the Closing Date), the Sellers shall have the right at its sole cost and their expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Selleraudit or proceeding but only to the extent that such audit or proceeding relates solely to a potential adjustment for which the Sellers have acknowledged their liability; the Buyers also may participate in any such audit or proceeding at their expense. If Seller timely elects to control the Sellers do not assume the defense of any such Tax Claim audit or proceeding, the Buyers may defend the same in accordance with such manner as they may deem appropriate, including, but not limited to, settling such audit or proceeding after giving five days' prior written notice to the Sellers setting forth the terms and conditions of settlement (subject to Section 8.4(d)). In the event that issues relating to a potential adjustment for which the Sellers have acknowledged their liability pursuant to this Section 5.068.4(b) are required to be dealt with in the same proceeding as separate issues relating to a potential adjustment for which the Buyers would be liable, the Buyers shall have the right, at their expense, to control the audit or proceeding with respect to the latter issues. In such cases, Buyer and Seller will cooperate in deciding any issue that must be decided jointly (including, without limitation, choice of judicial forum).
(c) With respect to issues relating to a potential adjustment in the Taxes of the US Company for which both the Sellers (as evidenced by their acknowledgment under this Section 8.4) and the Buyers or the Companies could be liable, (i) Seller shall keep Purchaser reasonably apprised of each party may participate in the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceeding, and (ii) Purchaser the audit or proceeding shall have be controlled by that party which would bear the right burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the immediately preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (including, without limitation, choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article 8 by the Buyers and the Sellers.
(d) Neither the Buyers nor the Sellers shall enter into any compromise or agree to consentsettle any claim pursuant to any Tax audit or proceeding with respect to the US Company which would adversely affect the other party for such year or a subsequent year without the written consent of the other party, which consent may not be unreasonably withheld. The Buyers and the Sellers agree to cooperate, conditioned and the Buyers agree to cause the US Company to cooperate, in the defense against or delayed, to compromise of any settlement claim in any audit or proceeding.
(e) Notwithstanding anything to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under contrary in this Agreement. Except as otherwise required by , the foregoing provisions of this Section 5.06, Purchaser Canadian Company or Sellers shall have the right to solely control any proceedings relating audit or proceeding with respect to Taxes of or with respect to the Company or any of its Subsidiaries; providedCanadian Company, however, that, in and the case of a Tax Claim with respect to a Straddle Period, Seller Buyer Parties shall be entitled have no right to participate in any such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Sources: Membership Interest and Asset Purchase Agreement (Barnes Group Inc)
Contests. Whenever (a) After the Closing, each party shall promptly notify the other party in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding or of any demand or claim on the other party or its Affiliates which, makes an assessmentif determined adversely to the taxpayer or after the lapse of time, could be grounds for indemnification under Section 7.01. Such notice shall contain factual information (to the extent known to such party) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or otherwise disputes other document received from any taxing authority in respect of any such asserted Tax liability. If either party fails to give the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of other party prompt notice of an asserted Tax liability as required by this Section 7.03, then such party shall not have any obligation to indemnify for any Loss arising out of such asserted Tax Claimliability, promptly inform Seller in writing; provided, however, but only to the extent that failure to give such notice as provided herein shall not relieve Seller results in an actual detriment to such party.
(b) In the case of its obligations under this Article V except to the extent a Tax audit or administrative or judicial proceeding (a “Contest”) that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Datedate of the Closing, or otherwise relating the Seller shall have the sole right, at its expense, to Taxes for which control the conduct of such Contest.
(c) With respect to Straddle Periods, the Seller may be liable under this Agreement (other than elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax liability with respect to a Straddle Period)which indemnity may be sought from the Seller pursuant to Section 7.01. If the Seller elects to direct such Contest, at its sole cost and expense by written notice to Purchaser the Seller shall within ten sixty (1060) days of receipt of the notice thereof; providedof asserted Tax liability notify the Purchasers of its intent to do so, however, that Purchaser mayand the Purchasers shall cooperate and shall cause the Companies to cooperate, at its sole cost and the Seller’s expense, retain separate counsel in each phase of its choosing such Contest. If the Seller elects to direct such Contest, then the Purchasers may participate in such Contest, at the defense or settlement of such Tax Claim by SellerPurchasers’ expense. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to direct the Contest, the Purchasers may assume control of such Contest (at the defense Purchasers’ expense). If a Purchaser assumes control of such Contest (whether because the Seller elects not to assume control or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right because it is not entitled to control such Contest), then the defense of such Tax Claims Seller may participate, at its sole cost and own expense, and in the Contest. Neither the Seller shall have nor any Purchaser may settle or compromise any asserted liability with respect to any Contest governed by this Section 7.03(c) without prior written consent of the right to consentother party, which consent may shall not be unreasonably withheld, conditioned withheld or delayed.
(d) The Purchasers and the Seller agree to reasonably cooperate, and agree to any settlement thereof cause their Affiliates to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatreasonably cooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany Contest.
Appears in 1 contract
Sources: Stock Purchase Agreement (HLTH Corp)
Contests. Whenever (a) After the Closing, Buyer shall promptly notify Sellers, and Sellers shall promptly notify Buyer, in writing of the commencement of any Taxing Authority asserts Tax audit or administrative or judicial proceeding or of any demand or claim which, if determined adversely to the taxpayer, could be grounds for indemnification under, respectively, Section 12.2(a) or 12.2(b). Such notice shall contain factual information (to the extent known) describing the asserted Tax liability. If any party hereto fails to give prompt notice of an asserted Tax liability as required by this Section 12.4, then (i) if the party entitled to notice is precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then such party shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (ii) if the party entitled to notice is not so precluded from contesting but such failure to give prompt notice results in a claimdetriment to such party or to such party's ability to fully and properly contest such asserted Tax liability, makes then any amount which such party is otherwise required to pay pursuant to Section 12.2(a) or 12.2(b), as applicable, with respect to any such liability shall be reduced by the amount of such detriment.
(b) Sellers may elect to direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability (any such audit, claim for refund or proceeding relating to an assessmentasserted Tax liability is referred to herein as a "Contest") with respect to which indemnity may be sought under Section 12.2(a); PROVIDED, HOWEVER, that Sellers may not settle, compromise, or otherwise disputes dispose of such Contest without the amount prior written consent of Taxes for Buyer, which Seller may reasonably consent shall not be expected unreasonably withheld or delayed. If Sellers elect to be liable under this Agreement (direct a “Tax Claim”)Contest, Purchaser they shall upon within 30 calendar days of receipt of the notice of asserted Tax liability provided for in Section 12.4
(a) notify Buyer of their intent to do so, and Buyer shall cooperate and shall cause each Acquired Company or its successor to cooperate, at the expense of Sellers, in each phase of such Tax ClaimContest. If Sellers elect not to direct the Contest or fail to notify Buyer of their election as herein provided, promptly inform Seller Buyer or the Acquired Companies, may, in writinggood faith, pay, compromise or contest such asserted liability, subject to Sellers' consent, which shall not be withheld or delayed unreasonably; provided, however, that failure any reasonable expense incurred by Buyer in connection with such assumption of the direction of the Contest shall be included as Damages subject to give Section 12.2(a) hereof. If Sellers direct such notice Contest as provided herein hereinabove provided, Buyer and each Acquired Company (and any successor thereto) shall not relieve Seller empower (by power of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on attorney or before the Closing Date, or otherwise relating to Taxes for which Seller such other documentation as may be liable under this Agreement appropriate) such representatives of Sellers as the latter may designate to handle such Contest.
(other than c) Buyer may at its election and solely at its expense, participate in, but not control, any Contest with respect to a Straddle Periodwhich indemnity may be sought under Section 12.2(b), at its sole cost and expense by written notice . Sellers shall be required to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense consult with Buyer only on those aspects of any such Tax Claim in accordance Contest with this respect to which Buyer would be liable for indemnification under Section 5.06, (i) Seller 12.2(b). Sellers shall keep Purchaser reasonably apprised regularly inform Buyer of the status of the Tax Claim and the defense thereof any such Contest and shall provide Buyer with any documents, correspondence, or other material or information as Buyer may reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser request relating thereto. Sellers shall have obtain the right to consentconsent of Buyer, which consent may shall not be unreasonably withheld, conditioned withheld or delayed, prior to taking any settlement significant actions on any matter in such Contest with respect to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may Buyer could be liable for taxable periods ending after the Closing Dateindemnification. If Seller elects Such significant actions include but are not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof limited to the extent such settlement would affect filing of a motion or appeal, as well as a settlement, compromise, or other disposition of the amount of Taxes for which Seller may be liable matter. Sellers shall at all times act in good faith in satisfying their obligations under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement12.4(c).
Appears in 1 contract
Contests. Whenever Buyer agrees to give written notice to the Sellers’ Representative of the receipt of any Taxing Authority asserts a claimwritten notice by the Company, makes an assessmentany Company Subsidiary, Buyer or otherwise disputes any of Buyer’s Affiliates which involves the amount assertion of Taxes any claim for which Seller may reasonably an indemnity will be expected sought by Buyer pursuant to be liable under this Agreement ARTICLE VII (a “Tax Claim”); provided, Purchaser that failure to comply with this provision shall upon receipt of notice not affect Buyer’s right to indemnification hereunder except and only to the extent that Sellers forfeit material rights or defenses by reason of such failure. The Sellers’ Representative may, at the Sellers’ own expense, participate in and assume the defense of any Tax Claim, promptly inform Seller in writing; provided, however, that failure the Sellers’ Representative acknowledges in writing the Sellers’ responsibility to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to indemnify and hold harmless the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than Buyer Indemnitees with respect to a Straddle Period)all Taxes at issue in such Tax Claim. If the Sellers’ Representative assumes such defense, at the Sellers’ Representative shall control all proceedings taken in connection with such Tax Claim (including selection of counsel) and may, in its sole cost reasonable discretion, pursue or forego any and expense by written notice to Purchaser within ten (10) days of receipt of notice thereofall administrative appeals, proceedings, hearings and conferences with any Taxing authority with respect thereto, and may, in its reasonable discretion, either pay the Tax claimed and s▇▇ for refund where applicable law permits such refund suits or contest the tax claim in any permissible manner; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser Buyer shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend participate in any such Tax Claim and the Sellers’ Representative shall provide Buyer with copies of all written communications relating to the Tax Claim, Purchaser (ii) the Sellers’ Representative shall have keep Buyer informed regarding the right to control the defense progress of such Tax Claims at its sole cost Claim and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or consult with Buyer with respect to any issue that could have an adverse effect on Buyer, the Company or any of its Subsidiaries; provided, however, that, in Company Subsidiary and (iii) the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser Sellers’ Representative shall not settle such portion of such or otherwise resolve any Tax Claim (or any issue raised in any Tax Claim) without the Seller’s consent, prior written consent of Buyer (which consent may shall not be unreasonably withheld, conditioned withheld or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement).
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (i) After the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)Closing Date, Purchaser shall upon receipt promptly notify Seller Representative in writing of any written notice of such Tax Claima proposed adjustment or Claim in an audit or administrative or judicial proceeding involving Purchaser or any of the Company Parties which, promptly inform Seller in writingif determined adversely to the taxpayer, would be grounds for indemnification under this Section 10.3; provided, however, that a failure or delay to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect Purchaser’s right to indemnification thereunder except to the extent extent, if any, that Seller is Sellers are materially prejudiced thereby. Seller shall have .
(ii) In the right to elect to control the defense case of any Tax Claim relating an audit or administrative or judicial proceeding that relates solely to taxable periods ending on or before the Closing Date, provided, that, Seller Representative acknowledges in writing its obligation to indemnify Purchaser and the Company Parties (to the extent not covered by the R&W Insurance Policy or otherwise relating to Taxes for which Seller Indemnity Escrow Account) amount of any adjustment that may be liable under this Agreement (other than with respect to made as a Straddle Period)result of such audit or proceeding and, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, howeverprovided further, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense such audit or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of proceeding does not seek criminal penalties against any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status Company Parties or material equitable or other non-monetary remedies against any of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser Company Parties, Seller Representative shall have the right at Seller Representative’s expense to consentparticipate in and control the conduct of such audit or proceeding. Subject to the provisions and limitations set forth in the preceding sentence, Purchaser shall use its commercially reasonable efforts to allow Seller Representative, at Seller Representative’s expense, to control any portion of any other audit or proceeding that relates to taxable periods ending on or before the Closing Date. The Seller Representative shall keep Purchaser informed of the progress of any such audit or proceeding (including the prompt provision to Purchaser of all material correspondence, pleadings, protests, briefs and other documents pertaining to such audit or proceeding), and Purchaser also may participate in any such audit or proceeding at its expense. Seller Representative shall not settle any such audit or proceeding without the advance written consent of Purchaser, which consent may shall not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects Representative does not to control assume the defense or thereafter fails or ceases to defend of any such Tax Claimaudit or proceeding, the provisions of Section 10.3(e)(iii) shall apply with respect thereto.
(iii) With respect to any other audit or proceeding not controlled by Seller Representative, such audit or proceeding shall be controlled by Purchaser. If, however, Sellers could be subject to any liability under this Agreement in connection with any such audit or proceeding, Purchaser shall have keep the right Seller Representative informed of the progress of any such audit or proceeding (including the prompt provision to control the defense Seller Representative of all material correspondence, pleadings, protests, briefs and other documents pertaining to such Tax Claims audit or proceeding), Seller Representative may also participate in any such audit or proceeding at its sole cost expense and expense, and Purchaser shall not settle any such audit or proceeding without the advance written consent of Seller shall have the right to consentRepresentative, which consent may shall not be unreasonably withheld, conditioned or delayed.
(iv) For the avoidance of doubt, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.0610.3(e), Purchaser and not those of Section 9.3, shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, apply in the case of a Tax Claim with respect any adjustment, claim, controversy or administrative or judicial proceeding relating to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementTaxes.
Appears in 1 contract
Contests. Whenever If a written claim for payment is made by any Taxing Authority asserts a claim, makes taxing authority against an assessment, Indemnitee for any Imposition with respect to which Lessee or otherwise disputes the amount of Taxes for which Seller Guarantor may reasonably be expected to be liable under for indemnity pursuant to this Agreement Section 7.4, such Indemnitee shall give Lessee and Guarantor written notice of such claim promptly after its receipt, and shall furnish Lessee and Guarantor with copies of such claim and all other writings received from the taxing authority to the extent relating to such claim. The Indemnitee shall not pay such claim until at least thirty (30) days after providing Lessee and Guarantor with such written notice, unless required to do so by law or regulation. Subject to the conditions set forth in the following paragraph, Lessee and Guarantor shall be entitled to contest (acting through counsel selected by Lessee and Guarantor and reasonably acceptable to the Indemnitee), and control the contest of, any such claim with respect to an Imposition (a “Tax Claim”) if (i) the contest of the Tax Claim may be pursued in the name of Lessee or Guarantor; (ii) the contest of the Tax Claim must be pursued in the name of the Indemnitee but can be pursued independently from any other proceeding involving a tax liability of such Indemnitee for which Lessee and Guarantor are not responsible or (iii) the Indemnitee requests that Lessee and Guarantor control such contest. In the case of all other Tax Claims, subject to the conditions set forth in the following paragraph, the Indemnitee shall contest the Tax Claim if Lessee and Guarantor shall request that the Imposition be contested, and the following rules shall apply with respect to such contest:
(1) the Indemnitee shall control the contest of such Tax Claim in good faith taking into account any and all tax consequences to the Indemnitee, including, without limitation, those associated with a recharacterization of the transaction contemplated by the Operative Documents by any taxing authority (acting through counsel selected by the Indemnitee and reasonably acceptable to Lessee and Guarantor),
(2) the Indemnitee shall not otherwise settle, Purchaser compromise or abandon such contest without Lessee’s and Guarantor’s prior written consent except as provided in the concluding paragraph to this Section 7.4(b). In either case, the party conducting such contest shall upon receipt consult with and keep reasonably informed the other party and its designated counsel with respect to such Tax Claim, shall provide the other party with copies of any reports or claims issued by the relevant auditing agents or taxing authority as well as related portions of tax returns, and shall consider and consult in good faith with the other party regarding any request, including but not limited to requests (a) to resist payment of Impositions if practical and (b) not to pay such Impositions except under protest if protest is necessary and proper (but the decisions regarding what actions are to be taken shall be made by the controlling party in its sole judgment). Notwithstanding the foregoing, no contest with respect to a Tax Claim shall be required or permitted and Lessee and Guarantor shall be required to pay the applicable Impositions without contest, unless:
(1) within thirty (30) days after notice by the Indemnitee to Lessee and Guarantor of such Tax Claim, promptly inform Seller Lessee and Guarantor shall request in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except writing to the extent Indemnitee that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any such Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes be contested; provided that if a shorter period is required for which Seller may be liable under this Agreement (other than taking action with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof Indemnitee notifies Lessee and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense Guarantor of such Tax Claims at its sole cost requirement, Lessee and expenseGuarantor shall use reasonable efforts to request such contest within such shorter period,
(2) no Event of Default has occurred and is continuing,
(3) there is no risk of sale, and Seller shall have the right to consentforfeiture or loss of, which consent may not be unreasonably withheldor, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, except in the case of a Tax Claim involving only disputed state or local property or ad valorem taxes, the creation of a Lien on Lessee’s interest in, the Leased Property as a result of such Tax Claim (other than a Permitted Lien); provided that this clause (3) shall not apply if the Lessee and Guarantor post security satisfactory to the Indemnitee in its sole discretion, or the Imposition is fully paid in either manner specified in clause (5) below,
(4) there is no risk of imposition of any criminal penalties,
(5) if such contest involves payment of such Imposition, Lessee and Guarantor shall either advance to the Indemnitee on an interest-free basis, and with no after-tax cost to such Indemnitee, the amount of the Imposition (a “Tax Advance”) or pay such Indemnitee the amount payable by Lessee and Guarantor pursuant to this Section 7.4 with respect to such Imposition,
(6) Lessee and Guarantor agree to pay (and pay on demand) and with no after-tax cost to such Indemnitee, all reasonable costs, losses and expenses incurred by the Indemnitee in connection with the contest of such claim (including all reasonable legal, accounting and investigatory fees and disbursements),
(7) except in the case of a Tax Claim involving only disputed state or local property or ad valorem taxes, (A) the Indemnitee has been provided at Lessee’s and Guarantor’s sole expense with an opinion, reasonably acceptable to such Indemnitee, of independent tax counsel of recognized standing selected by Lessee and Guarantor and reasonably acceptable to the Indemnitee to the effect that there is a reasonable basis for contesting such Tax Claim; and (B) the amount of the disputed federal Taxes in controversy, taking into account the amount of all similar and logically related Impositions with respect to the transactions contemplated by the Operative Documents that could be raised in any other year (including any future year) not barred by the statute of limitations, exceeds $50,000;
(8) Lessee and Guarantor shall acknowledge in writing their liability to indemnify the Indemnitee hereunder, on and subject to the terms and conditions hereof, in respect of such claim if the contest is not successful, and
(9) in the case of a judicial appeal, no appeal to the U.S. Supreme Court shall be required of the Indemnitee or shall be permitted by Lessee and Guarantor. Notwithstanding anything to the contrary contained in this Section 7.4, the Indemnitee at any time may elect to decline to take any action or any further action with respect to a Straddle Period, Seller shall be entitled to participate Tax Claim and may in such proceeding (at its sole cost and expense) discretion settle or compromise any contest with respect to the extent such Tax Claim is related without Lessee’s and Guarantor’s consent if the Indemnitee:
(1) waives its right to the portion of such Straddle Period that is a Pre-Closing Tax Period, any indemnity payment by Lessee and Purchaser shall not settle such portion Guarantor pursuant to this Section 7.4 in respect of such Tax Claim without (and any other claim for Impositions with respect to any other taxable year and/or with respect to any other claim, the Sellercontest of which is effectively precluded by the Indemnitee’s consentdeclination to take action with respect to the Tax Claim), which consent may not be unreasonably withheld, conditioned or delayed, if and
(2) promptly repays to Lessee and Guarantor any Tax Advance and any amount paid to such settlement would affect the amount of Taxes for which Seller may be liable Indemnitee under this AgreementSection 7.4 in respect of such Taxes, but not any costs or expenses with respect to any such contest. Except as provided in the preceding sentence, any such waiver shall be without prejudice to the rights of the Indemnitee with respect to any other Tax Claim.
Appears in 1 contract
Contests. Whenever (i) After the Closing, Denbury shall promptly notify the Matrix Common Shareholders in writing of the commencement of any Tax audit or administrative or judicial proceeding or of any demand or claim on Denbury, Matrix or any Affiliate which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification by the Matrix Common Shareholders. Such notice shall contain factual information (to the extent known to Denbury) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Taxing Authority asserts authority in respect of any such asserted Tax liability. If Denbury fails to give the Matrix Common Shareholders prompt notice of an asserted Tax liability, then (i) if the Matrix Common Shareholders are precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, the Matrix Common Shareholders shall not have any obligation to indemnify for any an increase in a claimTax liability allocable to the Matrix Common Shareholders as a result of such proceeding, makes and (ii) if the Matrix Common Shareholders are not so precluded from contesting, but such failure to give prompt notice results in an assessment, or increase in the Tax liability allocable to the Matrix Common Shareholders as a result of such proceeding then any amount which the Matrix Common Shareholders are otherwise disputes required to pay Denbury with respect to such liability shall be reduced by the amount of Taxes such increase in the Tax liability allocable to the Matrix Common Shareholders that was the result of Denbury's failure to give prompt notice to the Matrix Common Shareholders. The failure to give such notice on a timely basis shall not affect the indemnification provisions provided herein except to the extent the Matrix Common Shareholders demonstrate they have been actually prejudiced as a result of such failure and such prejudice resulted in an increase in the Tax liability allocable to the Matrix Common Shareholders.
(ii) Except as otherwise provided herein, Denbury shall direct any audit, claim or refund and administrative or judicial proceeding involving any asserted Tax liability regarding Matrix (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "Contest"). The Matrix Common Shareholders may elect to direct, through counsel of their own choosing and at their own expense, any Contest of a Pre-Closing Return involving any asserted liability with respect to which Seller indemnity may reasonably be expected sought from the Matrix Common Shareholders. If the Matrix Common Shareholders elect to be liable under this Agreement direct the Contest of an asserted Tax liability of a Pre-Closing Return, they shall, within thirty (a “Tax Claim”), Purchaser shall upon 30) calendar days of receipt of the notice of asserted Tax liability, notify Denbury of their intent to do so and Denbury shall cooperate and shall cause Matrix and Subsidiaries to cooperate, in each phase of such Contest. If the Matrix Common Shareholders do not elect to direct the Contest of an asserted Tax Claimliability of a Pre- Closing Return, promptly inform Seller in writing; fail to notify Denbury of their election as herein provided, or contest their indemnification obligation, Denbury may pay, compromise or contest, at its expense, such asserted liability. Neither Denbury nor the Matrix Common Shareholders may settle or compromise any Contest involving any asserted liability with respect to which indemnity may be sought from the Matrix Common Shareholders over the objection of the parties not directing the Contest, provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld. In any event, conditioned or delayedboth Denbury and the Matrix Common Shareholders may participate, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and their own expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to in any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or Contest involving an asserted Tax liability with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller indemnity may be liable under this Agreementsought from the Matrix Common Shareholders.
Appears in 1 contract
Contests. Whenever (a) After the Closing, Purchaser shall promptly notify the Representative in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claim, makes an assessment, Tax audit or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement administrative or judicial proceeding (a “Contest”) or of any demand or claim on Purchaser, its Affiliates, or any Acquired Company which, if determined adversely to the taxpayer or after the lapse of time, could be grounds for indemnification against the Stockholders under Article 8. Such notice shall contain factual information (to the extent known to Purchaser, its Affiliates, or any Acquired Company) describing the asserted Tax Claim”)liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability. The failure of Purchaser to give the Representative prompt notice of an asserted Tax liability as required by this Section 7.2 shall not relieve the Stockholders of any obligation to indemnify for any loss arising out of such asserted Tax liability, except if the Stockholders shall have been actually and materially prejudiced as a result of such failure.
(b) With respect to taxable periods that include but do not end on the date of the Closing, Purchaser may elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax liability with respect to which indemnity may be sought from the Stockholders pursuant to Article 8. If Purchaser elects to direct a Contest, Purchaser shall upon within ninety (90) calendar days of receipt of the notice of asserted Tax liability notify the Representative of its intent to do so. In such Tax Claimcase, promptly inform Seller the Representative may participate at its own expense in writingthe Contest and Purchaser shall not settle or compromise any asserted liability without prior written consent of the Representative, which consent shall not be unreasonably withheld. If Purchaser elects not to direct the Contest, the Representative may assume control of such Contest (at the Representative’s own expense) as it relates to Pre-Closing Taxes and Purchaser and the applicable Acquired Companies shall cooperate, at the Representative’s expense, in each phase of such Contest. However, in such case, the Representative may not settle or compromise any asserted liability without prior written consent of Purchaser; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, .
(c) Purchaser and the Representative agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have Purchaser agrees to cause the right Acquired Companies to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatcooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany Contest.
Appears in 1 contract
Sources: Merger Agreement (Davita Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes (a) In the case of an assessment, audit or otherwise disputes the amount of Taxes for which Seller may reasonably be expected administrative or judicial proceeding that relates to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, Date or otherwise relating to Taxes for which Seller the Purchaser may be liable under this Agreement (other than with respect to a Straddle Period)seek indemnity from the Sellers, the Sellers shall have the right, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and their expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Selleraudit or proceeding but only to the extent that such audit or proceeding relates to a potential adjustment for which the Sellers have acknowledged the Sellers' liability and the issue underlying the potential adjustment does not recur for any period ending subsequent to the Closing Date. The Sellers shall keep the Purchaser fully informed of the progress of any such audit or proceeding and, if it appears in the sole discretion of the Purchaser, that such audit or proceeding may reasonably be expected to adversely affect the Purchaser or the Company, the Purchaser also may participate in any such audit or proceeding. If Seller timely elects to control the Sellers do not assume the defense of any such Tax Claim audit or proceeding promptly, the Purchaser may defend and settle the same (for the Sellers' account and at the Sellers' expense) in accordance such manner as it may deem appropriate. In the event that a potential adjustment as to which the Sellers would be liable is present in the same proceeding as a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit or proceeding with this Section 5.06respect to the latter potential adjustment.
(b) With respect to a potential adjustment for which both the Sellers and the Purchaser or the Company could be liable, or which involves an issue that recurs for any period ending after the Closing Date (whether or not the subject of audit at such time), (i) Seller shall keep both the Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto Sellers may participate in the audit or proceeding, each at its own expense, and (ii) the audit or proceeding shall be controlled by that party which would bear the burden of the greater portion of the dollar amount of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (in particular, choice of judicial forum) in circumstances in which separate issues are otherwise controlled hereunder by the Purchaser and the Sellers.
(c) Except as provided in Section 8.4(a) above, neither the Purchaser nor the Sellers shall have enter into any compromise or agree to settle any claim pursuant to any Tax audit or proceeding which would adversely affect the right other party, or result in a material benefit to consentthat party, for such year or a subsequent year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned withheld or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever (a) After the Closing Date, the Company shall, and prior to the Closing Date, BAT shall, promptly notify the other Party in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding involving the other Party which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingSection 7; provided, however, that a failure to give such notice will not affect the Shareholders’ or the Company’s right, as provided herein shall not relieve Seller of its obligations under this Article V the case may be, to indemnification hereunder, except to the extent extent, if any, that, but for such failure, the other Party could have avoided or contested the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right relates to elect to control the defense of any Tax Claim relating to taxable periods ending period ended on or before the Closing Date, or otherwise relating provided that within 30 days after the Shareholders receive the written notice from Company, and prior to Taxes for which Seller may be liable under this Agreement (other than taking any action with respect to such audit or administrative or judicial proceeding, the Shareholders acknowledges in writing the Shareholders’ liability under Section7.3(a) of this Agreement to hold the Company harmless against the full amount of any adjustment which may be made as a Straddle Period)result of such audit or proceeding that relates to such period, except to the extent provided otherwise in Section 7.5(c) below, The Shareholders shall have the right at its sole cost and the Shareholders’ own expense by written notice to Purchaser within ten (10) days control the conduct of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to such audit or proceeding. The Company also may participate in any such audit or proceeding at the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control Company’s expense and, if the Shareholders do not assume the defense of any such Tax Claim in accordance with audit or proceeding, the Company may, without any effect to the Company’s right to indemnification under this Section 5.067, defend the same in such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding after giving five days’ prior written notice to the Shareholders setting forth the terms and conditions of such settlement.
(c) With respect to a proposed adjustment for which both the Shareholders (as evidenced by the Shareholders’ acknowledgment under this Section 7.5) and the Company could be liable, or which involves an adjustment to a period ended on or before the Closing Date or a change of accounting method or other issue that recurs for any post Closing period (whether or not the subject of an audit or proceeding at such time), (i) Seller shall keep Purchaser reasonably apprised of each Party may participate in the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceeding, and (ii) Purchaser the audit or proceeding shall have be controlled by that Party which would bear the right to consentburden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (in particular, choice of judicial forum) in situations in which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as separate issues are otherwise required controlled hereunder by the foregoing provisions of this Section 5.06, Purchaser shall have Company and the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementShareholders.
Appears in 1 contract
Sources: Stock Exchange Agreement (Tree Top Industries, Inc.)
Contests. Whenever A. The Managing Member, in its capacity as the TMP, shall inform the Investor Member promptly of any Taxing Authority asserts a claim, makes an assessmentoral or written communication or request for information which the Managing Member may receive from, or otherwise disputes conference with, the amount of Taxes for which Seller may reasonably be expected IRS directly related to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except an administrative proceeding with respect to the extent that Seller is materially prejudiced thereby. Seller shall have Company, the right to elect to control Project or the defense of any Historic Tax Claim Credit relating to taxable periods ending on the Project.
B. The Managing Member, in its capacity as the TMP, shall confer with the Investor Member and its counsel before responding to any notice, letter, request for information, request for inspection of documents, subpoena or before other correspondence or item of communication or document received by the Closing DateManaging Member, from, or otherwise oral request made by, the IRS which is directly related to an administrative proceeding with respect to the Company, Project or the Historic Tax Credit relating to Taxes for which Seller may be liable under this Agreement (other than the Project.
C. If the Managing Member desires to contest a determination by the IRS with respect to a Straddle Period)Company tax item that would result in an adjustment, at its sole cost and expense by written notice to Purchaser within ten Tax Indemnity Payment, distribution, or other payment under the provisions of Section 5.3 (10a “Deficiency Amount”) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and Investor Member objects to such a contest, the Investor Member shall reasonably consider recommendations made by Purchaser waive in writing its right to receive distributions or payments under this Agreement with respect thereto to that Company item and (ii) Purchaser the Managing Member shall have waive in writing its right as TMP to pursue the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or contest with respect to the Company item.
D. If the Managing Member and the Investor Member want to contest a determination by the IRS with respect to a Company tax item, then the Company shall be liable for the Costs of Contest, and
(i) the Investor Member shall select Qualified Counsel for the contest, which counsel shall be reasonably satisfactory to the Managing Member, and shall control the contest, or
(ii) if either (a) the credit quality (in the reasonable judgment of the Investor Member) of the Guarantor has not decreased materially from that set forth in its audited financial statements dated as of December 31, 1999, or any (b) the Managing Member provides the Investor Member security, in a form reasonably satisfactory to the Investor Member, in an amount necessary to secure the Managing Member’s obligations that may become due under this Agreement if the conflict were not resolved favorably for the Company and the Managing Member agrees in writing that all amounts due to the IRS as a result of the resolution of such contest are indemnified by the Managing Member, then the TMP shall select Qualified Counsel for the contest, which counsel shall be reasonably satisfactory to the Investor Member, and shall control the contest.
E. If the Managing Member does not want, and the Investor Member does want, to contest a determination by the IRS with respect to a Company tax item, the Investor Member shall select Qualified Counsel and control the contest and, if the credit quality (in the reasonable judgment of the Investor Member) of the Guarantor has not decreased materially from that set forth in its Subsidiaries; audited financial statements dated as of December 31, 1999, the Managing Member shall provide the Investor Member with security in a form reasonably satisfactory to the Investor Member, in an amount equal to the amount due under this Agreement if such determination was not contested, and, whether or not such security is required to be given, the Managing Member shall be liable for the Deficiency Amount that results from the contest, and shall pay that Deficiency Amount and also shall be liable for the Costs of Contest, provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser Managing Member’s maximum liability shall not settle such portion of such Tax Claim without exceed the Seller’s consentmaximum liability it would have had were the determination not contested.
F. If the Managing Member timely pays the full amount due under Section 5.4D or 5.4E, which consent may not be unreasonably withheldas applicable, conditioned the Investor Member shall release the security given pursuant to Section 5.4D or delayed5.4E as applicable, or, if such settlement would affect the full amount is not timely paid, the Investor Member may apply or otherwise realize upon any and all security given by the Managing Member to satisfy the amount due under Section 5.4D or 5.4E, as applicable.
G. In the event of Taxes for which Seller may be liable under any conflict between the provisions of this AgreementSection 5.4 and the provisions of Section 7.9, the provisions of this Section 5.4 shall apply.
Appears in 1 contract
Contests. Whenever Buyer agrees to give prompt notice to Seller of any Taxing Authority asserts proposed adjustment to Taxes payable by Symphony or any of its Subsidiaries (other than income Taxes includible in a claim, makes an assessment, consolidated or otherwise disputes combined Tax Return of Seller) for periods ending on or prior to the amount Closing Date (other than income Taxes includable on a consolidated or combined Tax Return of Taxes for which Seller) or any Pre-Closing Partial Period. Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of give Buyer prompt notice of such any proposed adjustments in income Taxes of Symphony includable on a consolidated or combined Tax Claim, promptly inform Return of Seller. Buyer and Seller shall cooperate with each other in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller the conduct of any audit or other proceeding involving Symphony or and of its obligations under this Article V except to the extent that Seller is materially prejudiced therebySubsidiaries for such periods and each party may participate at its own expense. Seller shall have the right to elect to control the defense conduct of any Tax Claim relating to taxable periods ending on such audit or before the Closing Date, or otherwise relating to Taxes proceeding for which Seller may be liable under agrees in writing that any resulting Tax allocable to any period prior to and including the Closing Date is covered by the indemnity set forth in Section 10.1 of this Agreement Agreement, (other than with respect to such audit or proceeding, a Straddle Period"Sellers' Contest"), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, provided that: (i) Seller shall keep Purchaser reasonably apprised Buyer informed regarding the progress and substantive aspects of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto any Sellers' Contest and (ii) Purchaser Seller shall not compromise or settle any Sellers' Contest if such compromise or settlement would have the right to consenteffect of (x) increasing any Tax liability of Symphony or any of its Subsidiaries or (y) otherwise materially and adversely affect any item or Tax attribute of Symphony or any of its Subsidiaries, which consent may not be unreasonably withheld, conditioned or delayed, to in each case for any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods period ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to without obtaining Buyer's consent, which consent may shall not be unreasonably withheld. If Seller chooses to direct a Sellers' Contest, conditioned or delayedBuyer shall cause powers of attorney authorizing Seller's designee to represent Symphony and its Subsidiaries before the relevant taxing authority and such other documents as are reasonably necessary for Seller to control the conduct of any Sellers' Contest, to any settlement thereof to consistent with the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions terms of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement10.5.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Leucadia National Corp)
Contests. Whenever (a) Shareholders will allow ▇▇▇▇▇ and its counsel to participate at its own expense in any Taxing Authority asserts audits of a claimconsolidated, makes combined or unitary Tax Return of an assessment, or otherwise disputes the amount Affiliated Group of Taxes for which Seller may reasonably be expected to be liable under this Agreement (▇▇▇▇▇ was a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except member to the extent that Seller is materially prejudiced therebysuch Returns relate to ▇▇▇▇▇. Seller shall have the right to elect to control the defense of Shareholders will not settle any Tax Claim relating to taxable periods ending on or before such audit in a manner which would adversely affect ▇▇▇▇▇ after the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent Date unless such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, reasonable in the case of a Person that owned ▇▇▇▇▇ both before and after the Closing Date.
(b) After the Closing, Bancorp shall promptly notify Shareholders in writing of the commencement of any Tax Claim audit or administrative or judicial proceeding or of any demand or claim on Bancorp or ▇▇▇▇▇ which, if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification under Section 8.01(a). Such notice shall contain factual information (to the extent known to Bancorp or ▇▇▇▇▇) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax liability. If Bancorp fails to give Shareholders prompt notice of an asserted Tax liability as required by this Section 8.05(b), then (i) if Shareholders are precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then Shareholders shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (ii) if Shareholders are not so precluded from contesting but such failure to give prompt notice results in a detriment to Shareholders, then any amount which Shareholders are otherwise required to pay Bancorp pursuant to Section 8.01(a) with respect to a Straddle Period, Seller such liability shall be entitled reduced by the amount of such detriment.
(c) Shareholders may elect to direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought under Section 8.01(a) (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "Contest"). If Shareholders elect to direct the Contest of an asserted Tax liability, they shall, within thirty (30) calendar days of receipt of the notice of asserted Tax liability (but not less than five (5) days before the due date of any protest or other claim in respect thereof), notify Bancorp of their intent to do so and acknowledge in writing, in form and substance satisfactory to Bancorp, their obligation to indemnify Bancorp in full therefor. Bancorp shall cooperate and shall cause ▇▇▇▇▇ to cooperate in each phase of such Contest. If Shareholders choose to direct the Contest, Bancorp shall promptly empower and shall cause ▇▇▇▇▇ promptly to empower (by power-of-attorney and such other documentation as may be appropriate) such representatives of Shareholders as they may designate to represent Bancorp or ▇▇▇▇▇ in the Contest insofar as the Contest involves an asserted Tax liability for which Shareholders would be liable under Section 8.01(a).
(d) If Shareholders elect not to direct the Contest and acknowledge in writing, in form and substance satisfactory to Bancorp, their obligation to indemnify Bancorp in full therefor, then (i) Shareholders may participate, at their own expense, in the Contest and (ii) neither Bancorp nor ▇▇▇▇▇ shall not settle or compromise any asserted liability over the objection of Shareholders. If Shareholders elect not to direct the Contest and fail to provide such acknowledgment, then (x) Shareholders shall have no right to participate in the Contest and (y) Bancorp or ▇▇▇▇▇ may pay, compromise or contest such proceeding (at its asserted liability in their sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementdiscretion.
Appears in 1 contract
Sources: Merger Agreement (Bancorp, Inc.)
Contests. Whenever (a) After the Closing, the Purchaser shall reasonably promptly after becoming aware thereof notify the Seller in writing of the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding and shall also separately notify the Seller in writing of any demand or claim on the Purchaser which, makes if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification by the Seller under this Article VII. Such notice shall contain factual information (to the extent known to the Purchaser) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller reasonably prompt notice of an assessmentasserted Tax liability as required by this Section 7.04, then (i) if the Seller is precluded by the failure to give reasonably prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then the Seller shall not have any obligation to indemnify for any loss or damage arising out of such asserted Tax liability, and (ii) if the Seller is not so precluded from contesting but such failure to give reasonably prompt notice results in an actual detriment to the Seller, then any amount which the Seller is otherwise disputes required to pay the Purchaser pursuant to this Article VII with respect to such liability shall be reduced by the amount of Taxes such detriment.
(b) The Seller, promptly after receiving notice, may elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought against the Seller under this Article VII (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "CONTEST"). If the Seller elects to direct the Contest of an asserted Tax liability, the Purchaser shall cooperate in all reasonable respects, at the Seller's expense, in each phase of such Contest. If the Seller does not either reasonably promptly give notice to direct the Contest or commence the direction of the Contest or if it contests its obligation to indemnify under Section 7.01, the Purchaser may pay, compromise or contest, at its own expense, such asserted liability without waiving any of its rights to indemnification hereunder. However, in such case, the Purchaser may not settle or compromise any asserted liability over the objection of the Seller; PROVIDED, HOWEVER, that the Seller's consent to settlement or compromise shall not be unreasonably withheld or delayed. In any event, each of the Purchaser and the Seller may participate, at their own expense, in the Contest. If the Seller chooses to direct the Contest, the Purchaser shall promptly empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller as Seller may designate to represent the Purchaser or its successor in the Contest insofar as the Contest involves an asserted Tax liability for which the Seller may reasonably be expected to would be liable under this Agreement (a “Tax Claim”)Article VII. If, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice any proposed settlement referred to Purchaser within ten in clause (10x) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status previous sentence, the Seller proposes in good faith to settle a claim, suit, action or proceeding with respect to any Tax, which settlement offer is accepted by the relevant taxing authority, the Purchaser may elect to continue to contest such claim, suit, action or proceeding; PROVIDED that notwithstanding how such matter is ultimately settled or decided, the liability of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser Seller with respect thereto and to such claim, suit, action or proceeding shall be no greater than the amount which would have been payable if the Purchaser had consented to the settlement proposed by the Seller.
(iic) The Purchaser shall have the sole obligation and right to consentdirect, which consent may not be unreasonably withheldat its own expense, conditioned or delayed, to a Contest regarding any settlement to the extent such settlement would affect the amount of Taxes Tax Return for which Purchaser or its Affiliates may be liable for any taxable periods ending period commencing after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, Date in the case of a Tax Claim Return which is filed on a combined, consolidated, unitary or similar basis with respect to a Straddle Periodthe Purchaser; PROVIDED, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to HOWEVER, that the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle advise and consult with the Seller regarding the status of any such portion of such Contest that involves an asserted Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes liability for which the Seller may would be liable under this AgreementArticle VII and PROVIDED, FURTHER, that, Purchaser shall not, without the prior written consent of the Seller (which shall not be unreasonably withheld or delayed) settle any such contest.
Appears in 1 contract
Sources: Asset Purchase Agreement (White Mountains Insurance Group LTD)
Contests. Whenever (a) After the Effective Time, the Purchaser -------- shall promptly notify the Partners in writing of the commencement of any Taxing Authority asserts Tax audit or administrative or judicial proceeding or of any demand or claim on the Purchaser or KBC which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification under Section 8.02. Such notice shall contain factual information (to the extent known to the Purchaser or KBC) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Partners prompt notice of an asserted Tax liability as required by this Section 8.05, then (i) if the Partners are precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then the Partners shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (ii) if the Partners are not so precluded from contesting but such failure to give prompt notice results in a claimdetriment to the Partners, makes an assessment, or then any amount which the Partners are otherwise disputes required to pay the Purchaser pursuant to Section 8.02 with respect to such liability shall be reduced by the amount of Taxes such detriment.
(b) The Partners shall control in their sole and absolute discretion, and the Purchaser and KBC shall cooperate with the Partners with respect to, any audit, controversy or administrative or judicial proceeding relating to Income Tax Returns of KBC or the Partners for any taxable period ending at or before the Effective Time.
(c) The Partners may elect to control any audit, claim for refund and administrative or judicial proceeding involving any asserted Non-Income Tax liability with respect to which Seller indemnity may reasonably be expected sought under Section 8.02 (any such audit, claim for refund or proceeding relating to be liable under this Agreement (an asserted Tax liability is referred to herein as a “"Contest"). If the Partners elect to direct a ------- Contest, they shall, within 30 calendar days of receipt of the notice of asserted Tax Claim”)liability, notify the Purchaser of their intent to do so, and the Purchaser shall upon receipt cooperate and shall cause KBC or its successor to cooperate, at the expense of notice the Partners, in each phase of such Tax ClaimContest. If the Partners elect not to control the Contest, promptly inform Seller fail to notify the Purchaser of their election as herein provided or contest their obligation to indemnify under Section 8.02, the Purchaser or KBC may pay, compromise or contest, at its own expense, such asserted liability. However, in writingsuch case, neither the Purchaser nor KBC may settle or compromise any asserted liability over the objection of the Partners; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller be -------- ------- unreasonably withheld. In any event, the Partners may participate, at their own expense, in the Contest. If the Partners choose to direct the Contest, the Purchaser shall promptly empower and shall cause KBC or its successor promptly to empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Partners as it may designate to represent the Purchaser or KBC or its obligations under this Article V except to successor in the extent that Seller is materially prejudiced thereby. Seller shall have Contest insofar as the right to elect to control the defense of any Contest involves an asserted Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes liability for which Seller may the Partners would be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement8.02.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before a) After the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by the Buyer shall promptly notify the Sellers in writing of any written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate a proposed assessment or claim in the defense an audit or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned administrative or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to judicial proceeding involving the Company or any of its SubsidiariesSubsidiaries which, if determined adversely to the Company or relevant Subsidiary, would be grounds for indemnification under this Article 7; provided, -------- however, that a failure to give such notice will not affect a Buyer Indemnified ------- Person's right to indemnification hereunder except to the extent, if any, that, but for such failure, the Sellers could have avoided the Tax liability in question.
(b) In the case of a Tax Claim an audit or administrative or judicial proceeding that relates to any Pre-Closing Period, the Sellers shall have the right at their own expense to control the conduct of such audit or proceeding; provided -------- that within 30 days after the Sellers have received the written notice from the Buyer that is required under Section 7.3(a) above, and prior to taking any action with respect to such audit or administrative or judicial proceeding, the Sellers acknowledge in writing their joint liability under Section 7.3(b)(i) of this Agreement to hold any Buyer Indemnified Person harmless against the full amount of any adjustment which may be made as a Straddle Period, Seller shall be entitled result of such audit or proceeding that relates to participate in such proceeding the Pre-Closing Period (at its sole cost and expense) to the extent such amount exceeds the Closing Balance Sheet Tax Claim is related Reserve after giving effect to all prior and concurrent payments made pursuant to Section 7.3(b)(i) of this Agreement to any Buyer Indemnified Person); provided, further, that the Sellers may not agree -------- ------- to a settlement or compromise to any such audit or proceeding that may reasonably be expected to have an adverse effect on the tax liability of the Company for a taxable period after the Closing Date without the prior written consent of the Buyer; provided, -------- further, that if the Buyer does not consent to such settlement or compromise, ------- the Sellers' liability to indemnify the Buyer as a result of such audit or proceeding shall be limited to the portion amount that the Sellers would have paid had the Buyer consented to such settlement or compromise. The Buyer also may participate in any such audit or proceeding at its own expense and, if the Sellers do not assume the defense of any such audit or proceeding, the Buyer may defend the same at its own expense in such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding, without any effect to any Buyer Indemnified Person's right to indemnification under this Article 7.
(c) In the case of an audit or administrative or judicial proceeding that relates to the Interim Period, the Buyer shall have the right at its own expense to control the conduct of such Straddle Period audit or proceeding; provided that is the -------- Buyer may not agree to a Pre-Closing Tax Period, and Purchaser shall not settle settlement or compromise in any such portion of such Tax Claim audit or proceeding without the prior written consent of the Seller’s consent's Representative (as defined in Section 12.5 below), which consent may shall not be unreasonably withheld, conditioned . The Sellers also may participate in any such audit or delayedproceeding at their own expense and, if the Buyer does not assume the defense of any such settlement would affect audit or proceeding, the amount of Taxes for which Seller Sellers may be liable defend the same at its own expense in such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding, without any effect to the Sellers' right to indemnification under this AgreementArticle 7.
Appears in 1 contract
Contests. Whenever (a) After the Closing, the Purchaser shall reasonably promptly after becoming aware thereof notify the Seller in writing of the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding and shall also separately notify the Seller in writing of any demand or claim on the Purchaser which, makes if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification by the Seller under this Article VII. Such notice shall contain factual information (to the extent known to the Purchaser) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller reasonably prompt notice of an assessmentasserted Tax liability as required by this Section 7.04, then (i) if the Seller is precluded by the failure to give reasonably prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then the Seller shall not have any obligation to indemnify for any loss or damage arising out of such asserted Tax liability, and (ii) if the Seller is not so precluded from contesting but such failure to give reasonably prompt notice results in an actual detriment to the Seller, then any amount which the Seller is otherwise disputes required to pay the Purchaser pursuant to this Article VII with respect to such liability shall be reduced by the amount of Taxes such detriment.
(b) The Seller, promptly after receiving notice, may elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought against the Seller may reasonably be expected to be liable under this Agreement Article VII (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a “"Contest"). If the Seller elects to direct the Contest of an asserted Tax Claim”)liability, the Purchaser shall upon receipt of notice cooperate in all reasonable respects, at the Seller's expense, in each phase of such Tax ClaimContest. If the Seller does not either reasonably promptly give notice to direct the Contest or commence the direction of the Contest or if it contests its obligation to indemnify under Section 7.01, promptly inform Seller the Purchaser may pay, compromise or contest, at its own expense, such asserted liability without waiving any of its rights to indemnification hereunder. However, in writingsuch case, the Purchaser may not settle or compromise any asserted liability over the objection of the Seller; provided, however, that failure the Seller's consent to give such notice as provided herein settlement or compromise shall not relieve be unreasonably withheld or delayed. In any event, each of the Purchaser and the Seller may participate, at their own expense, in the Contest. If the Seller chooses to direct the Contest, the Purchaser shall promptly empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller as Seller may designate to represent the Purchaser or its obligations under this Article V except to successor in the extent that Seller is materially prejudiced thereby. Seller shall have Contest insofar as the right to elect to control the defense of any Contest involves an asserted Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes liability for which the Seller may would be liable under this Agreement (other than Article VII. If, with respect to any proposed settlement referred to in clause (x) of the previous sentence, the Seller proposes in good faith to settle a Straddle Period)claim, suit, action or proceeding with respect to any Tax, which settlement offer is accepted by the relevant taxing authority, the Purchaser may elect to continue to contest such claim, suit, action or proceeding; provided that notwithstanding how such matter is ultimately settled or decided, the liability of the Seller with respect to such claim, suit, action or proceeding shall be no greater than the amount which would have been payable if the Purchaser had consented to the settlement proposed by the Seller.
(c) The Purchaser shall have the sole obligation and right to direct, at its sole cost and expense by written notice to Purchaser within ten (10) days own expense, a Contest regarding any Tax Return for any taxable period commencing after the Closing Date in the case of receipt of notice thereofa Tax Return which is filed on a combined, consolidated, unitary or similar basis with the Purchaser; provided, however, that the Purchaser may, at its sole cost shall advise and expense, retain separate counsel of its choosing to participate in consult with the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control regarding the defense status of any such Contest that involves an asserted Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes liability for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06Article VII and provided, further, that, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; providednot, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, prior written consent of the Seller (which consent may shall not be unreasonably withheld, conditioned withheld or delayed, if ) settle any such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementcontest.
Appears in 1 contract
Sources: Asset Purchase Agreement (Risk Capital Holdings Inc)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing upon receipt of a correspondence or a notice from a Taxing Authority of an audit or inquiry that, if determined adversely to the taxpayer or after the lapse of time, could be grounds for indemnification by the Seller under Section 7.01 or Section 9.02. Such notice shall contain factual information (to the extent known to the Purchaser, its Affiliates or any of the Acquired Companies) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Taxing Authority asserts in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller notice within 30 days of receiving the correspondence or notice from a claimTaxing Authority, makes an assessmentthen the Seller shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, but only to the extent that the Seller is prejudiced by such failure to give such notice.
(b) In the case of a Tax audit or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement administrative or judicial proceeding (a “Tax ClaimContest”) that relates to Pre-Closing Periods (other than a Contest described in Section 7.03(c)), the Seller shall have the sole right, at its expense, to control the conduct of such Contest.
(c) With respect to Straddle Periods (other than a Contest described in Section 7.03(d)), the Seller may elect to direct and control, through counsel of its own choosing, any Contest involving any asserted Tax liability with respect to which indemnity may be sought from the Seller pursuant to Section 7.01. If the Seller elects to direct a Contest, the Seller shall within 30 days of receipt of the notice of asserted Tax liability notify the Purchaser of its intent to do so, and the Purchaser shall upon receipt of notice cooperate and shall cause the Acquired Companies to fully cooperate, at the Seller’s expense, in each phase of such Tax ClaimContest. If the Seller elects not to direct the Contest, promptly inform the Purchaser or any of the Acquired Companies may assume control of such Contest (at the Purchaser’s expense), and the Purchaser shall provide the Seller a timely and reasonably detailed summary of each phase of such Contest. However, in writingsuch case, none of the Purchaser or any of the Acquired Companies may settle or compromise any asserted liability without prior written consent of the Seller; provided, however, that failure consent to give such notice as provided herein settlement or compromise shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed. In any event, to any settlement the Seller may participate, at its own expense, in a Contest described in this Section 7.03(c).
(d) Notwithstanding anything to the extent such settlement would affect contrary in this Agreement, the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the exclusive right to control any proceedings relating to Taxes of or with respect to in all respects, and neither the Company or Purchaser nor any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller Affiliates shall be entitled to participate in, any Contest with respect to (i) any Tax Return of the Seller or any of its Subsidiaries (other than the Acquired Companies) and (ii) any Tax Return of a consolidated, combined, unitary, or affiliated Tax group of which the Seller is a member.
(e) The Purchaser and the Seller agree to cooperate, and the Purchaser agrees to cause the Acquired Companies to cooperate, in such proceeding the defense against or compromise of any claim in any Contest.
(at its sole cost and expensef) Notwithstanding anything to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under contrary in this Agreement, this Section 7.03 shall control with respect to any Contest.
Appears in 1 contract
Sources: Stock and Asset Purchase Agreement (S&P Global Inc.)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes (a) Sellers will allow the amount of Taxes for which Seller may reasonably be expected Company and its counsel to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), participate at its sole cost and own expense by written notice to Purchaser within ten (10) days in any audits of receipt a consolidated, combined or unitary Tax Return of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel an Affiliated Group of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries was a member to the extent that such Returns relate to the Company and its Subsidiaries; provided, however, that, . Sellers will not settle any such audit in a manner which would adversely affect the Company and its Subsidiaries after the Closing Date unless such settlement would be reasonable in the case of a Person that owned the Company and its Subsidiaries both before and after the Closing Date.
(b) After the Closing, Purchasers shall promptly notify Sellers in writing of the commencement of any Tax Claim audit or administrative or judicial proceeding or of any demand or claim on Purchasers, the Company or any of its Subsidiaries which, if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification under Section 8.01(a). Such notice shall contain factual information (to the extent known to Purchasers, the Company or its Subsidiaries) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax liability. If Purchasers fail to give Sellers prompt notice of an asserted Tax liability as required by this Section 8.05(b), then (i) if Sellers are precluded by the failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then Sellers shall not have any obligation to indemnify for any loss arising out of such asserted Tax liability, and (ii) if Sellers are not so precluded from contesting but such failure to give prompt notice results in a detriment to Sellers, then any amount which Sellers are otherwise required to pay Purchasers pursuant to Section 8.01(a) with respect to a Straddle Period, Seller such liability shall be entitled reduced by the amount of such detriment.
(c) Sellers may elect to direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought under Section 8.01(a) (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "Contest"). If Sellers elect to direct the Contest of an asserted Tax liability, they shall, within thirty (30) calendar days of receipt of the notice of asserted Tax liability (but not less than five (5) days before the due date of any protest or other claim in respect thereof), notify Purchasers of their intent to do so and acknowledge in writing, in form and substance satisfactory to Purchasers, their obligation to indemnify Purchasers in full therefor. Purchasers shall cooperate and shall cause the Company, its Subsidiaries or their successors to cooperate in each phase of such Contest. If Sellers choose to direct the Contest, Purchasers shall promptly empower and shall cause the Company, its Subsidiaries and their successors promptly to empower (by power-of-attorney and such other documentation as may be appropriate) such representatives of Sellers as they may designate to represent Purchasers, the Company, its Subsidiaries or their successors in the Contest insofar as the Contest involves an asserted Tax liability for which Sellers would be liable under Section 8.01(a). If Sellers elect not to direct the Contest and acknowledge in writing, in form and substance satisfactory to Purchasers, their obligation to indemnify Purchasers in full therefor, then (i) Sellers may participate, at their own expense, in the Contest and (ii) neither Purchasers, the Company nor any Subsidiary shall settle or compromise any asserted liability over the objection of Sellers. If Sellers elect not to direct the Contest and fail to provide such acknowledgment, then (x) Sellers shall have no right to participate in the Contest and (y) Purchasers, the Company or its Subsidiaries may pay, compromise or contest such proceeding (at its asserted liability in their sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementdiscretion.
Appears in 1 contract
Contests. Whenever (a) After the Closing, Buyer or Stockholders, as the case may be, shall promptly notify the other Party in writing of the commencement of any Taxing Authority asserts audit, examination or proceeding or of any claim or other proposed change or adjustment of which it or any of its Affiliates has been informed in writing by any Tax authority which, if determined adversely to the taxpayer, may result in liability of the other Party under Article VII (each, a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “"Tax Claim”), Purchaser shall upon receipt ") describing in reasonable detail the nature of notice the Tax Claim and including copies of such any notices or other documents received from the Tax Claim, promptly inform Seller in writingauthority; provided, however, that the failure to timely give such notice as provided herein shall will not relieve Seller of its obligations affect the indemnified party's right to indemnification under this Article V VII except to the extent that Seller the indemnifying party is materially prejudiced thereby. Seller shall have by such delay or omission.
(b) In the right to elect to control the defense case of any a Tax Claim relating that relates to taxable Tax periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), Stockholders shall have the right at its sole cost and their expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense conduct of any audit or settlement of proceeding, but only to the extent that such Tax Claim by Selleraudit or proceeding relates to a potential adjustment for which Stockholders may be liable; Buyer also may participate in any such audit or proceeding. If Seller timely elects to control Stockholders do not assume the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned audit or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending proceeding within 30 business days after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense Buyer gives written notice of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof Claim to the extent Stockholders, Buyer may defend the same in such settlement would affect the amount of Taxes for which Seller manner as it may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in deem appropriate.
(c) In the case of a Tax Claim that relates to an Interim Tax Period, the Parties shall jointly control any audit or proceeding, and there shall be no settlement with respect thereto without the prior written consent of both such parties, which consent shall not unreasonably be withheld.
(d) In the event that issues relating to a potential adjustment for which Stockholders may be liable are required to be dealt with in the same audit or proceeding as separate issues relating to a potential adjustment for which Buyer may be liable, Stockholders shall have the right, at their expense, to control the audit or proceeding with respect to a Straddle Periodthe former issues, Seller and Buyer shall be entitled to participate in such proceeding (have the right, at its sole cost and expense) , to control the audit or proceeding with respect to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementlatter issues.
Appears in 1 contract
Contests. Whenever (i) After the Closing Date, Seller and Buyer each shall notify the other party in writing within ten (10) days of the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding affecting the Taxes of any of Panhandle or the Panhandle Subsidiaries that, makes an assessment, if determined adversely to the taxpayer (the "TAX INDEMNIFIED PARTY") or otherwise disputes after the amount lapse of Taxes time would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement Section 5.6 by the other party (the "TAX INDEMNIFYING PARTY" and a “"TAX CLAIM"). Such notice shall contain factual information describing any asserted Tax Claim”), Purchaser liability in reasonable detail and shall upon receipt include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax Claim, promptly inform Seller in writing; provided, however, that failure liability. Failure to give such notice as provided herein notification shall not relieve Seller of its obligations under affect the indemnification provided in this Article V Section 5.6 except to the extent that Seller is materially prejudiced thereby. Seller the Tax Indemnifying Party shall have been prejudiced as a result of such failure (except that the right Tax Indemnifying Party shall not be liable for any expenses incurred during the period in which the Tax Indemnified Party failed to elect give such notice). Thereafter, the Tax Indemnified Party shall deliver to control the defense Tax Indemnifying Party, as promptly as possible but in no event later than ten (10) days after the Tax Indemnified Party's receipt thereof, copies of all relevant notices and documents (including court papers) received by the Tax Indemnified Party.
(ii) In the case of an audit or administrative or judicial proceeding involving any Tax Claim asserted liability for Taxes relating to taxable any Taxable years or periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period)shall have the right, at its sole cost and expense by written notice expense, to Purchaser within ten (10) days control the conduct of receipt of notice thereofsuch audit or proceeding; provided, however, that Purchaser if Seller does not timely take control of such audit or proceeding, Buyer may, at its sole cost and expense, retain separate counsel control the conduct of the audit or proceeding. In the case of an audit or administrative or judicial proceeding involving any asserted liability for Taxes relating to any Straddle Period, Buyer shall have the right, at its choosing expense, to control the conduct of such audit or proceeding; PROVIDED, HOWEVER, that (A) Buyer shall keep Seller reasonably informed with respect to the status of such audit or proceeding and provide Seller with copies of all written correspondence with respect to such audit or proceeding in a timely manner and (B) if such audit or proceeding would be reasonably expected to result in a material increase in Tax liability of Panhandle or the Panhandle Subsidiaries for which Seller would be liable under this Section 5.6, Seller may participate in the defense or settlement conduct of such Tax Claim by Seller. If Seller timely elects to control audit or proceeding at its own expense.
(iii) In the defense case of an audit or administrative or judicial proceeding involving any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, asserted liability for Taxes relating to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser Taxable years or its Affiliates may be liable for taxable periods ending beginning after the Closing Date. If Seller elects not , Buyer shall have the right, at its expense, to control the defense conduct of such audit or thereafter fails or ceases to defend proceeding.
(iv) Buyer and Seller shall reasonably cooperate in connection with any such Tax Claim, Purchaser and such cooperation shall have include the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof provision to the extent such settlement would affect the amount Tax Indemnifying Party of Taxes for records and information which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right are reasonably relevant to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related and making employees available on a mutually convenient basis to the portion provide additional information and explanation of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementany material provided hereunder.
Appears in 1 contract
Sources: Stock Purchase Agreement (Panhandle Eastern Pipe Line Co)
Contests. Whenever (i) After the Closing, Buyer shall promptly notify Seller in writing of (x) any Taxing Authority asserts a claim, makes an assessment, correspondence from any Tax authority relating to any Tax Return filed by Seller pursuant to Section 5.15(b)(i) or otherwise disputes the amount of Taxes for which Seller may reasonably be expected by Buyer pursuant to be liable under this Agreement Section 5.15(b)(ii) and (a “Tax Claim”), Purchaser shall upon receipt of y) any written notice of such Tax Claima proposed assessment or claim in an audit or administrative or judicial proceeding involving CMI, promptly inform CEL or any of their Subsidiaries (clauses (x) and (y) together, a "TAX CONTEST") which, if determined adversely to the taxpayer, would be grounds for indemnification by Seller in writing(including any payment under Section 5.15(c)); providedPROVIDED, howeverHOWEVER, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations affect Buyer's right to indemnification (including any payment under this Article V Section 5.15(d)) hereunder except to the extent extent, if any, that, but for such failure, such Group Company and Seller could have avoided the Tax liability in question.
(ii) In the case of a Tax Contest that Seller is materially prejudiced thereby. relates to a Pre-Closing Period, Seller shall have the right to elect at its expense to control the conduct of such Tax Contest; PROVIDED that (x) Seller shall indemnify any Group Company in respect of all third-party costs and expenses incurred by such Group Company at Seller's request in connection with such Tax Contest, (y) Seller shall keep Buyer informed of all material progress (and shall send Buyer copies of all material correspondence relating thereto) of the Tax Contest and (z) Seller shall not enter into any compromise or agree to settle any claim pursuant to such Tax Contest with respect to any issue that recurs for any Straddle Period or Post-Closing Period or any item resulting in a reciprocal adjustment to any Straddle Period or Post-Closing Period without the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed). Buyer also may participate at its own expense in any such Tax Contest and, if Seller does not notify Buyer within 30 days of receiving notice of such Tax Contest pursuant to Section 5.15(e)(i) hereof of its intent to assume the defense of any such Tax Claim relating Contest, Buyer may defend the same in such manner as it may deem appropriate, including, but not limited to, settling such Tax Contest after giving five days' prior written notice to taxable periods ending on or before Seller setting forth the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement terms and conditions of settlement.
(other than with respect iii) In the case of a Tax Contest that relates to a Straddle Period), at its sole cost (x) each of Seller and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to Buyer may participate in the defense or settlement Tax Contest, and (y) the Tax Contest shall be controlled by that party which would bear the burden of the greater portion of the adjustment (the "CONTROLLING PARTY"); PROVIDED that (a) the Controlling Party shall indemnify any Group Company in respect of all third-party costs and expenses incurred by such Group Company at the Controlling Party's request in connection with such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06Contest, (ib) Seller the Controlling Party shall keep Purchaser reasonably apprised the other party informed of the status all material progress (and shall send such party copies of all material correspondence relating thereto) of the Tax Claim Contest and (c) if Seller is the defense thereof and Controlling Party, Seller shall reasonably consider recommendations made by Purchaser not enter into any compromise or agree to settle any claim pursuant to such Tax Contest with respect thereto to any issue that recurs for any Straddle Period or Post-Closing Period or any item resulting in a reciprocal adjustment to any Straddle Period or Post-Closing Period without the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed). The principle set forth in clause (b) of the preceding sentence also shall govern for purposes of deciding any issue that must be decided jointly (in particular, choice of judicial forum) in situations in which separate issues are otherwise controlled hereunder by Buyer and Seller.
(iiiv) Purchaser In the case of a Tax Contest that relates to a Post-Closing Period, Buyer shall have the right at its expense to consentcontrol the conduct of such Tax Contest.
(v) Except as provided in paragraph (ii) above, neither Buyer nor Seller shall enter into any compromise or agree to settle any claim pursuant to any Tax Contest which would adversely affect the other party for such year or a subsequent year, or which would result in a payment under Section 5.15(d), without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . Buyer and Seller agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Buyer agrees to consentcause CMI, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or CEL and any of its Subsidiaries; provided, however, thattheir Subsidiaries to cooperate, in the case defense against or compromise of a any claim in any Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Crown Media Holdings Inc)
Contests. Whenever (a) After the date of the Effective Time, Parent shall promptly notify the Shareholders' Representative in writing of any Taxing Authority asserts written notice of a claimproposed adjustment or claim in an audit or administrative or judicial proceeding involving Parent or the Company or the Subsidiary which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingArticle VIII; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect Parent's right to indemnification hereunder except to the extent extent, if any, that, but for such failure, the Shareholders could have avoided the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Datedate of the Effective Time, or otherwise relating to Taxes for which Seller may be liable provided that the Shareholders' Representative on behalf of all Shareholders acknowledges in writing the Shareholders' liability under this Agreement (other than to hold Parent and the Company and the Subsidiary harmless against the full amount of any adjustment that may be made as a result of such audit or proceeding that relates to taxable periods ending on or before the date of the Effective Time, the Shareholders' Representative shall have the right at the Shareholders' expense to participate in and control the conduct of such audit or proceeding but only to the extent that such audit or proceeding relates solely to a potential adjustment for which the Shareholders' Representative has acknowledged the Shareholders' liability and the issue underlying the proposed adjustment if resolved would not materially prejudice the Company or the Subsidiary from taking a contrary position for any period ending after the date of the Effective Time with respect to a Straddle Period)such recurring issue. The Shareholders' Representative shall keep Parent informed of the progress of any such audit or proceeding and if it appears in the reasonable discretion of Parent that such audit or proceeding may adversely affect Parent, Parent also may participate in any such audit or proceeding at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the Shareholders' Representative does not assume the defense of any such Tax Claim audit or proceeding, Parent may defend the same in accordance such manner as it may deem appropriate at its expense, including, but not limited to, settling such audit or proceeding after giving five days prior written notice to the Shareholders' Representative setting forth the terms and conditions of settlement. In the event that a potential adjustment as to which the Shareholders' Representative has acknowledged the Shareholders' liability is present in the same proceeding as a potential adjustment for which Parent would be liable, Parent shall have the right at its expense, to control the audit or proceeding with respect to the latter potential adjustment.
(c) With respect to an audit or proceeding that relates to a potential adjustment for which both the Shareholders (as evidenced by their acknowledgement under this Section 5.068.04) and Parent or the Company or the Subsidiary could be liable, or which involves a taxable period ending after the Effective Time but includes the Effective Time (and the Shareholders' Representative has acknowledged in writing the Shareholders' portion of the tax liability under Section 8.01(b)) or an issue that recurs for any period ending after the date of the Effective Time (whether or not the subject of audit at such time) that the Shareholders' Representative does not control pursuant to Section 8.04(b) above, (i) Seller shall keep Purchaser reasonably apprised each of the status of Shareholders' Representative and Parent may participate in the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceeding at their respective expense, and (ii) Purchaser the audit or proceeding shall have be controlled by that party which would bear the right burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future Tax periods. The principle set forth in the preceding sentence shall govern also for purposes of deciding any issue that must be decided jointly (in particular, choice of judicial forum) in situation in which separate issues are otherwise controlled hereunder by Parent and the Shareholders' Representative.
(d) Except as otherwise provided in Section 8.04(b) above, neither Parent nor the Shareholders' Representative shall enter into any compromise or agree to consentsettle any claim pursuant to any Tax audit or proceeding which would adversely affect the other party for such year or a subsequent year without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . Parent and the Shareholders agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Parent agrees to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to cause the Company or any of its Subsidiaries; provided, however, thatand the Subsidiary to cooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned any audit or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Contests. Whenever For purposes of this Agreement, a "Contest" is any Taxing Authority asserts a claimaudit, makes an assessment, court proceeding or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than dispute with respect to a Straddle Period)any Tax matter that affects the Company. Unless the Purchaser has previously received written notice from the Seller of the existence of such Contest, at its sole cost and expense by the Purchaser shall give written notice to Purchaser the Seller of the existence of any Contest relating to a Tax matter that is the Seller's responsibility under Section 11.3 within ten (10) days from the receipt by the Purchaser of any written notice of such Contest, but no failure to give such notice shall relieve the Seller of any liability hereunder except to the extent such failure increases any interest or penalties that otherwise would be payable by Seller hereunder. Unless the Seller has previously received written notice from the Purchaser of the existence of such Contest, the Seller shall give written notice to the Purchaser of the existence of any Contest relating to a Tax matter for which the Purchaser has responsibility within ten (10) days from the receipt by the Seller of any written notice of such Contest but no failure to give such notice shall relieve the Purchaser of any liability hereunder except to the extent such failure increases any interest or penalties that otherwise would be payable by Purchaser hereunder. The Purchaser, on the one hand, and the Seller, on the other, agree, in each case at no cost to the other party, to cooperate with the other and the other's representatives in a prompt and timely manner in connection with any Contest. Such cooperation shall include, but not be limited to, making available to the other party, during normal business hours, all books, records, returns, documents, files, other information (including without limitation working papers and schedules), officers or employees (without substantial interruption of employment) or other relevant information necessary or useful in connection with any Contest requiring any such books, records, files, other items, persons and information. The Seller shall, at its election, have the right to represent the Company's interests in any Contest relating to a Tax matter relating to or arising in a Pre-Acquisition Period, to employ counsel of its choice at its expense, which counsel shall be reasonably acceptable to the Purchaser, and to control the conduct of such Contest, including settlement or other disposition thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentconsult with the Seller regarding any such Contest that may affect the Company for any Post-Acquisition Periods at the Purchaser's own expense, provided further that any settlement or other disposition of any such Contest may only be made with the consent of Purchaser, which consent may shall not be unreasonably withheld. With regard to Contests relating solely to Tax matters that are the Seller's responsibility under Section 11.3 and which could have no effect on any Taxes that are the Purchaser's responsibility under Section 11.4, conditioned the Seller shall have the exclusive right to decide whether any consent or delayed, waivers to any settlement to the extent such settlement would affect the amount extend applicable statutes of Taxes for which Purchaser or its Affiliates may limitations shall be liable for taxable periods ending after the Closing Dategranted. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, The Purchaser shall have the sole and exclusive right to control the defense conduct of such any Contest, including settlement or other disposition thereof, with respect to any Tax Claims at its sole cost and expensematter relating to or arising in a Post-Acquisition Period; provided, and however, that the Seller shall have the right to consentconsult with the Purchaser regarding any such Contest that may affect the Company for any Pre-Acquisition Periods at the Seller's own expense, provided further that any settlement or other disposition of any such Contest may only be made with the consent of Seller, which consent may shall not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever For purposes of this Agreement, a "Contest" is any Taxing Authority asserts a claimaudit, makes court proceeding or other dispute with respect to any tax matter that affects an assessment, or otherwise disputes Acquired Entity. Unless Purchaser has previously received written notice from Sellers of the amount existence of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”)such Contest, Purchaser shall upon receipt give written notice to Sellers of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense existence of any Tax Claim Contest relating to taxable periods a Tax matter arising in a period ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser Effective Date within ten (10) days from the receipt by Purchaser of any written notice of such Contest, but no failure to give such notice shall relieve the Seller of any liability hereunder. Unless Sellers have previously received written notice from Purchaser of the existence of such Contest, the applicable Seller shall give written notice to Purchaser of the existence of any Contest for which Purchaser has responsibility within ten (10) days from the receipt by such Seller of any written notice of such Contest. Purchaser, on the one hand, and Sellers, on the other, agree, in each case at no cost to the other party, to cooperate with the other and the other's representatives in a prompt and timely manner in connection with any Contest. Such cooperation shall include, but not be limited to, making available to the other party, during normal business hours, all books, records, Tax Returns, documents, files, other information (including working papers and schedules), officers or employees (without substantial interruption of employment) or other relevant information necessary or useful in connection with any Contest requiring any such books, records and files. Sellers shall, at their election, have the right to represent an Acquired Entity's interests in any Contest relating to a Tax matter arising in a period ending on or before the Effective Date, to employ counsel of its choice at their expense and to control the conduct of such Contest, including settlement or other disposition thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent consult with the Sellers regarding any such Contest that may not be unreasonably withheld, conditioned or delayed, to affect such Acquired Entity for any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense Date at Purchaser's own expense; and provided further, that any settlement or thereafter fails or ceases to defend other disposition of any such Tax Claim, Purchaser shall have Contest may only be with the right to control the defense consent of such Tax Claims at its sole cost and expense, and Seller shall have the right to consentPurchaser, which consent may will not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Sources: Purchase and Sale Agreement (CNL Hotels & Resorts, Inc.)
Contests. Whenever Section 6.16.3.1 After the Closing, each party shall promptly notify the other party of any Taxing Authority asserts demand, claim or notice of the commencement of a claim, makes an assessment, or otherwise disputes the amount of Tax Proceeding received with respect to Taxes for which Seller may reasonably be expected OpCo or Buyer is liable pursuant to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingAgreement; provided, however, that a party’s failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the other party’s rights to indemnification under this Article V Section 9.8 except to the extent that Seller the other party is materially prejudiced thereby. Seller Such notice shall contain factual information (to the extent known) describing the asserted Tax liability and shall include copies of the relevant portion of any notice or other document received from any Governmental Entity or any other Person in respect of any such asserted Tax liability.
Section 6.16.3.2 At OpCo’s request and expense, Buyer shall contest (or cause to be contested) any asserted Pre-Closing Tax Period Tax liability for which OpCo may have an indemnity obligation under Section 9.8. If OpCo so elects, and acknowledges in writing its ability and obligation to indemnify the Parent Indemnified Parties for the Pre-Closing Tax Period Tax in question, OpCo shall control the conduct, through counsel of its own choosing and at its own expense, of any Tax Proceeding involving any asserted Pre-Closing Tax Period Tax liability with respect to the Company and/or its Subsidiaries relating to Pre-Closing Tax Period Taxes for which OpCo is exclusively liable pursuant to Section 9.8; provided that Buyer and its Affiliates shall have the right to elect participate in such Tax Proceeding, including through counsel of their choosing, at their own expense. OpCo shall keep Buyer fully informed on a timely basis of all matters relating to any Tax Proceeding controlled by OpCo hereunder. OpCo shall not accept any proposed adjustment or enter into any settlement or agreement in compromise regarding any Tax Proceeding controlled by OpCo without the consent of Buyer, which consent shall not be unreasonably withheld or delayed. Notwithstanding any other provision in this Agreement, Buyer shall control the defense conduct of any Tax Claim Proceeding which may materially adversely affect any Parent Indemnified Party (after taking into account OpCo’s indemnification obligations); provided, that Buyer shall not accept any proposed adjustment or enter into any settlement or agreement in compromise regarding any Tax Proceeding controlled by Buyer for which OpCo may have an indemnity obligation without the consent of OpCo (not to be unreasonably withheld or delayed), and, if the Tax Proceeding relates to a Pre-Closing Tax Period or Straddle Period, OpCo shall have the right to participate in any such proceeding at its own expense. Buyer shall keep OpCo fully informed on a timely basis of all matters relating to taxable periods any Tax Proceeding controlled by Buyer hereunder.
Section 6.16.3.3 In the case of a Tax Proceeding that relates to a Straddle Period, Buyer shall control the conduct of such Tax Proceeding, but OpCo shall have the right to participate in such Tax Proceeding at its own expense if OpCo first acknowledges in writing its ability and obligation to indemnify the Parent Indemnified Parties for the portion of the Tax in question that relates to the portion of the Straddle Period ending on or before the Closing Date; provided, that Buyer shall not accept any proposed adjustment or otherwise enter into any settlement or agreement in compromise regarding any such Tax Proceeding OpCo’s prior written consent (such consent not to be unreasonably withheld or delayed). Buyer shall keep OpCo fully informed on a timely basis of all matters relating to Taxes for which Seller may any Tax Proceeding controlled by Buyer hereunder.
Section 6.16.3.4 Payment by OpCo of any amount due under Section 9.8 shall be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser made within ten (10) days of receipt of following written notice thereof; provided, however, by Buyer that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement payment of such Tax Claim amounts to the appropriate Governmental Entity or other applicable third party is due; provided that OpCo shall not be required to make any payment earlier than ten (10) days before it is due to the appropriate Governmental Entity or applicable third party. Payment by Seller. If Seller timely elects to control the defense Buyer of any amount due under Section 9.8 shall be made within ten (10) days following written notice by OpCo that payment of such Tax Claim in accordance with this Section 5.06, (i) Seller amounts to the appropriate Governmental Entity or other applicable third party is due; provided that Buyer shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, required to make any settlement payment earlier than ten (10) days before it is due to the extent such settlement would affect the amount of Taxes for which Purchaser appropriate Governmental Entity or its Affiliates may be liable for taxable periods ending after the Closing Dateapplicable third party. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in In the case of a Tax Claim that is contested in accordance with the provisions of this Section 6.16.3, payment of such contested Tax will not be considered due earlier than the date a “final determination” to such effect is made by such Governmental Entity. For this purpose, a “final determination” shall mean a settlement, compromise, or other agreement with the relevant Governmental Entity, a deficiency notice with respect to which the period for filing a Straddle Periodpetition with the Tax court or the relevant state, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion local or foreign tribunal has expired or a decision of such Straddle Period any court of competent jurisdiction that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without subject to appeal or as to which the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes time for which Seller may be liable under this Agreementappeal has expired.
Appears in 1 contract
Sources: Purchase Agreement (Hcp, Inc.)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Seller in writing of the commencement of any Taxing Authority asserts Tax audit or administrative or judicial proceeding and shall also separately notify the Seller in writing of any demand or claim on the Purchaser or the Company which, if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification by the Seller under this Article VII. Such notice shall contain factual information (to the extent known to the Purchaser or the Company) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller prompt notice of an asserted Tax liability as required by this Section 7.04, then (i) if the Seller is precluded by the failure to give prompt notice from contesting the asserted Tax liability in the appropriate administrative or judicial forums, then the Seller shall not have any obligation to indemnify the Purchaser for any loss or damage arising out of such asserted Tax liability, and (ii) if the Seller is not so precluded from contesting but such failure to give prompt notice results in a claimdetriment to the Seller, makes an assessment, or then any amount which the Seller is otherwise disputes required to pay the Purchaser pursuant to this Article VII with respect to such liability shall be reduced by the amount of Taxes for which such detriment.
(b) The Seller may reasonably elect to direct, through counsel of its own choosing and at its own expense, any audit, or administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be expected to be liable sought under this Agreement Article VII (any such audit or proceeding relating to an asserted Tax liability are referred to herein collectively as a “"CONTEST"). If the Seller elects to direct the Contest of an asserted Tax Claim”)liability, it shall within 30 calendar days of receipt of the notice of an asserted Tax liability notify the Purchaser of its intent to do so, and the Purchaser shall upon receipt of notice cooperate in good faith and shall cause the Company or its successor to cooperate in good faith, at the Seller's expense, in each phase of such Tax ClaimContest. If the Seller contests its obligation to indemnify the Purchaser under Section 7.01 and the Purchaser elects to proceed with the Contest, promptly inform the Seller shall only be obligated to pay the Purchaser's expenses in writingconnection with such Contest in the event it is determined that the Seller is obligated to pay such asserted liability under Section 7.01. If the Seller elects not to direct the Contest or fails to notify the Purchaser of its election as herein provided, the Purchaser or the Company may pay, compromise or contest such asserted liability, at the Seller's expense; provided, however, that failure to give such notice as provided herein shall not relieve if the Seller of has acknowledged its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than Section 7.01 with respect to a Straddle Period)such asserted liability, at its sole cost and expense by written notice to the Purchaser within ten may not contest such asserted liability. However, in such case, neither the Purchaser nor the Company (10including any designated representative of either) days may settle or compromise any asserted liability over the objection of receipt of notice thereofthe Seller; provided, however, that the Seller's consent to settlement or compromise shall not be unreasonably withheld (provided that in the event the Seller withholds consent, the Seller shall then be obligated to direct such Contest). In any event, each of the Purchaser may(or the Company) and the Seller may participate, at its sole cost and own expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by SellerContest. If the Seller timely elects chooses to control direct the defense of any Contest, the Purchaser shall promptly empower and shall cause the Company or its successor promptly to empower (by power-of-attorney and such Tax Claim in accordance with this Section 5.06, (iother documentation as may be appropriate) Seller shall keep Purchaser reasonably apprised such representatives of the status of Seller as it may designate to represent the Purchaser or the Company or its successor in the Contest insofar as the Contest involves an asserted Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes liability for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementArticle VII.
Appears in 1 contract
Sources: Stock Purchase Agreement (Sykes Healthplan Services Inc)
Contests. Whenever (i) After the Closing, the Buyer and the Beneficiaries (or their designee) shall promptly notify each other in writing of any Taxing Authority asserts a claimdemand or claim received by the Beneficiaries, makes an assessment, Buyer or otherwise disputes the amount of Company from any Tax authority or other party with respect to Taxes for which Seller the Beneficiaries are liable pursuant to Section 8.5(c)(i). Such notice shall contain factual information (to the extent known) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax authority in respect of any such asserted Tax liability.
(ii) The Beneficiaries (or their designee) may reasonably elect to control the conduct, through counsel of its own choosing and at its own expense, of any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be expected sought under Section 8.5(c)(i) (any such audit, claim for refund or proceeding relating to be liable under this Agreement (an asserted Tax liability is referred to herein as a “Tax Claim”"Contest"), Purchaser other than any Contest relating to the Massachusetts Big S Tax. If the Beneficiaries (or their designee) elect to control such a Contest, they shall upon within 20 calendar days of receipt of the notice of asserted Tax liability notify the Buyer of their intent to do so, and the Beneficiaries (or their designee) shall have all rights to settle, compromise and/or concede such Tax Claimasserted liability; PROVIDED, promptly inform Seller in writingHOWEVER, that Buyer shall have the right to consult with the Beneficiaries regarding any Contest that may affect the Company for any Post-Closing Period and PROVIDED FURTHER that the Beneficiaries shall not have the right to settle, compromise and/or concede any such Contest that may affect the Company for any period after the Closing Date without Buyer's prior written consent, which consent shall not be unreasonably withheld. If the Beneficiaries elect not to control such a Contest or fail to notify Buyer of their election as herein provided, Buyer or the Company may pay, compromise or contest, at its own expense, subject to (i) reimbursement by the Beneficiaries for reasonable third party expenses and (ii) the Beneficiaries' indemnification obligations under Section 8.5(c)(i); provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to (A) the extent that Seller is materially prejudiced thereby. Seller Beneficiaries shall have the right to elect to control consult with Buyer regarding any Contest that may affect the defense of Beneficiaries or the Trust for any Tax Claim relating to taxable periods ending on Pre-Closing Period or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period)which the Beneficiaries or the Trust may owe indemnification under this Agreement, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (iiB) Purchaser Buyer shall not have the right to settle, compromise and/or concede any such Contest without the Beneficiaries' prior written consent, which consent may shall not be unreasonably withheld, conditioned . Buyer shall have the sole right to represent the Company in any other Contest.
(iii) In the event that the Beneficiaries or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its their Affiliates may be liable for taxable periods ending shall after the Closing Date. If Seller elects take any position in any Tax Return, or reach any settlement or agreement on audit, which is in any manner inconsistent with any position taken by the Beneficiaries or any of their Affiliates in any filing, settlement or agreement made by the Beneficiaries prior to the Closing and such inconsistent position (i) requires the payment by Buyer of more Tax than would have been required to be paid had such position not been taken or such settlement or agreement not been reached, (ii) affects the determination of useful life, basis or method of depreciation, amortization or accounting of any of the assets or properties of the Company or (iii) accelerates the time at which any Tax must be paid by Buyer, then the Beneficiary, in each such case, shall provide timely and reasonable notice to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense Buyer of such position and shall indemnify Buyer and hold it harmless from any Tax Claims at its sole liability or Tax cost and expenseor any Loss arising from, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned in connection with or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementposition.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes Purchaser and the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure Representative agree to give such prompt notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense each other of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating proposed adjustment to Taxes for which any periods of the Company ending prior to the Closing Date or any Pre-Closing Partial Period. Purchaser and the Seller Representative shall cooperate with each other in the conduct of any audit or other proceeding involving the Company for such periods and each party may be liable under this Agreement (other than with respect to a Straddle Period), participate at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and own expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser Representative shall have the right to control the defense conduct of any such audit or proceeding for which the Sellers agree that any resulting Tax Claims at its sole cost allocable to any period prior to the Closing Date is covered by the indemnity set forth in Section 13.8 of this Agreement, (such audit or proceeding, a "Seller's Contest") provided that: (i) Seller Representative shall keep Purchaser informed regarding the progress and expense, substantive aspects of any Seller's Contest and (ii) Seller Representative shall not compromise or settle any Seller's Contest if such compromise or settlement would have the right to effect of (x) increasing any Tax liability of the Company or (y) otherwise materially and adversely affect any item or Tax attribute of the Company, in each case for any taxable period ending after the Closing Date, without obtaining Purchaser's consent, which consent may shall not be unreasonably withheld. If Seller Representative chooses to direct a Seller's Contest, conditioned or delayedPurchaser shall cause powers of attorney authorizing Seller Representative to represent the Company before the relevant taxing authority and such other documents as are reasonably necessary for Seller Representative to control the conduct of any Sellers' Contest, to any settlement thereof to consistent with the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions terms of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.13.5
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim(i) After the Closing Date, makes an assessmentthe Purchaser shall, or shall cause the Purchased Subsidiary to, notify the Sellers in writing promptly upon the commencement of any Tax audit or administrative or judicial proceeding or the receipt by the Purchaser or the Purchased Subsidiary of any request issued by any Taxation Authority for documents in connection with Taxes which are the subject of the indemnities provided for in Section 5.11(a) (but in any event within no later than ten (10) Business Days of such receipt by the Purchaser or the Purchased Subsidiary) which, could give rise to a Sellers’ liability under Section 5.11, provided the giving of such notice will not be a condition precedent to the liability of the Sellers under this Section 5.11, and shall also separately notify the Sellers in writing of any proposed or final demand or claim on the Purchaser or the Purchased Subsidiary which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification by the Tax Indemnifying Parties under Section 5.11(a). Each such notice shall contain factual information (to the extent known to the Purchaser or the Purchased Subsidiary) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax liability.
(ii) If the Purchaser or the Purchased Subsidiary fail to give the Sellers prompt notice of an asserted Tax liability as required by Section 5.11(h)(i) and if the Sellers are precluded by such failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, the Sellers shall not have any obligation to indemnify for any loss or damage arising out of such asserted Tax liability, and (ii) if the Sellers are not so precluded from contesting but such failure to give prompt notice results in additional liabilities, expenses or other detriment to the Sellers, then any amount which the Sellers otherwise disputes are required to pay to the Purchaser or the Purchased Subsidiary pursuant to this Section 5.11 with respect to such liability shall be reduced by the amount of Taxes such detriment; provided however, that such detriment is duly substantiated by the Sellers.
(iii) The Sellers may direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding to the extent it involves any asserted liability with respect to which indemnity by the Sellers may be sought under this Section 5.11 (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a “Contest”). If the Sellers choose to direct the Contest, the Purchaser or the Purchased Subsidiary, as applicable, shall promptly empower (by power of attorney and such other documentation as may be appropriate) such of Sellers’ representatives as Sellers may designate to represent the Purchaser or the Purchased Subsidiary insofar as the Contest involves an asserted Tax liability for which Seller may reasonably be expected to the Sellers would be liable under this Agreement Section 5.11.
(iv) The Sellers shall consult with respect to, and a “Tax Claim”)reasonable amount of time in advance of, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense settlement of any Tax Claim relating Contest controlled by the Sellers pursuant to taxable periods ending on this paragraph, and the Sellers may not settle any such Contest or before the Closing Datetransmit any material communication (whether oral, in writing or otherwise) to any Taxation Authority in connection with such Contest, or otherwise relating transmit any material communication (whether oral, in writing or otherwise) to Taxes for which Seller may be liable under this Agreement (other than any Taxation Authority in connection with respect to a Straddle Period)such Contest, at its sole cost and expense by without the prior written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised consent of the status of Purchaser or the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and Purchased Subsidiary, as applicable (ii) Purchaser shall have the right to consent, which consent may shall not be unreasonably withheld, conditioned withheld or delayed).
(v) If the Sellers elect not to direct the Contest, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates the Purchased Subsidiary, as the case may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense be, may pay, compromise or thereafter fails or ceases to defend any contest such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expenseasserted liability as it sees fit, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required reimbursed by the foregoing provisions Sellers for reasonable costs of this Section 5.06, Purchaser outside tax advisors and related professionals and reasonable out of pocket costs (for all of which appropriate supporting documentation shall have the right to control any proceedings relating to Taxes of or be provided) incurred in connection with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect liability ultimately determined to a Straddle Period, Seller shall be entitled to participate in such proceeding indemnifiable by the Sellers hereunder.
(at its sole cost and expensevi) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, The Sellers and Purchaser shall not settle such portion cooperate in respect of such any Contest. Such cooperation and information shall include providing copies of relevant Tax Claim without Returns or portions thereof, together with accompanying schedules and related work papers and documents relating to rulings or other determinations by Taxation Authorities. The Sellers and the Seller’s consentPurchaser will make themselves (and their respective employees) available, which consent may not be unreasonably withheldon a mutually convenient basis, conditioned to provide explanations of any documents or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable information provided under this AgreementSection 5.11.
Appears in 1 contract
Sources: Asset Purchase Agreement (Perry Ellis International Inc)
Contests. Whenever The Signing Stockholders shall have right, but not the obligation, at the Signing Stockholders' expense, to control any audit or examination by any Taxing Authority asserts a claimauthority of any Sellers' Tax Return and to contest, makes an assessmentresolve and defend against any assessment for additional Taxes, notice of Tax deficiency or other adjustment to Taxes relating to any of the Sellers' Tax Returns, to the extent such matter gives rise to, or otherwise disputes the amount of Taxes for which Seller may reasonably could be expected to be liable give rise to, an indemnification obligation on the part of the Signing Stockholders under this Agreement Section 8.2 or Section 8.3 (a “collectively, the "Sellers' Tax Claim”Matters"), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein the Signing Stockholders shall not relieve Seller settle or prosecute any Tax claim in a manner that would have an adverse effect on the Company, Haemonetics, or their affiliates without the prior written consent of Haemonetics, which consent shall not be unreasonably withheld or delayed. Haemonetics and its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller duly appointed representatives shall have the right to elect to control participate, at Haemonetics' expense, in the defense of any such Sellers' Tax Claim relating to taxable periods ending on Matters if Haemonetics or before the Closing Date, or otherwise relating to Taxes for which Seller Company may be liable under this Agreement (other than adversely affected thereby. If requested by the Signing Stockholders, the Company shall execute suitable powers of attorney in favor of the Signing Stockholders or their representatives permitting them to represent the Company with respect to a Straddle Period)such Sellers' Tax Matters. If the Signing Stockholders elect not to control, at its sole cost contest, resolve or defend as aforesaid, Haemonetics and expense by written notice the Company shall be entitled to Purchaser within ten (10) days of receipt of notice thereof; do so, provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in neither Haemonetics nor the defense Company shall settle or settlement of such otherwise resolve any Sellers' Tax Claim by Seller. If Seller timely elects to control Matters without the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised prior written consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentSigning Stockholders, which consent may shall not be unreasonably withheld, conditioned withheld or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Sources: Merger Agreement (Haemonetics Corp)
Contests. Whenever The Purchaser shall promptly notify the Sellers in writing upon receipt by the Purchaser or any Taxing Authority asserts a claimof its Affiliates of notice of any pending or threatened Tax audits, makes examinations or assessments which may affect any Tax liability for which the Sellers are liable or has an assessmentindemnification obligation, provided that failure to comply with this provision shall not affect the Purchaser’s right to payment or otherwise disputes indemnification hereunder except to the extent such failure impairs the Sellers’ ability to contest any such Tax liabilities. Such notice shall state the amount of Taxes for which Seller may reasonably be expected the claim, if known, and the method of computation thereof, the nature of such claim and a reference to be liable under the provision of this Agreement upon which such claim is based, all with reasonable particularity. The Sellers shall have the sole right to (i) control and conduct any such Tax audit or administrative or court proceeding relating to a “Pre-Closing Tax Claim”Period that has no effect on a subsequent period (and if any such Tax audit or administrative or court proceeding has an effect on a subsequent period, the Purchaser and the Sellers shall jointly control such Tax audit or administrative or court proceeding), Purchaser shall upon receipt (ii) to employ counsel of notice its choice at its expense, and (iii) settle, either administratively or after the commencement of litigation, any such Tax Claim, promptly inform Seller in writingaudit or administrative or court proceeding; provided, however, that failure to give such notice as provided herein the Sellers shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on compromise or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of settle any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser audit or administrative or court proceeding if such compromise or settlement could reasonably apprised be expected to increase the Tax liability of the status Purchaser or any of its Affiliates in a tax period that begins after the Closing Date without obtaining the prior written consent of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentPurchaser, which consent may shall not be unreasonably withheld, conditioned or delayed, . With respect to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser Tax audit or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings similar proceeding relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller the Purchaser and the Sellers shall jointly control such audit or similar proceeding. Neither the Purchaser nor any of its Affiliates may agree to settle any tax claim which the Sellers are responsible for or which settlement could reasonably be entitled expected to participate increase the Tax liability of the Sellers (or its beneficial owners) in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion respect of such Straddle Period that is a any Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim Period or Straddle Period without the Seller’s consentprior written consent of the Sellers, which consent may shall not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever Purchaser shall promptly notify Seller in writing upon receipt by Purchaser or the Company of written notice of any Taxing Authority asserts a claimpending or threatened federal, makes an assessmentstate, local or otherwise disputes foreign income or franchise tax audits or assessments which may materially affect the amount tax liabilities of Taxes the Company for which Seller may reasonably would be expected required to be liable under this Agreement (a “Tax Claim”indemnify Purchaser pursuant to Section 5.3(a), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the sole right to elect to control represent the defense of Company's interests in any Tax Claim tax audit or administrative or court proceeding relating to taxable periods ending on or before the Closing Date, or otherwise relating and to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate employ counsel of its choosing choice at its own expense. Seller shall not be entitled to participate in settle, either administratively or after the defense commencement of litigation, any claim for Taxes that would adversely affect the liability for Taxes of Purchaser or settlement the Company for any period after the Closing Date without the prior written consent of Purchaser; provided that such Tax Claim by Seller. If consent shall not be unreasonably withheld or delayed and shall not be necessary to the extent that Seller timely elects to control has indemnified Purchaser against the defense effect of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Datesettlement. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (participate, at its own expense, in the defense of any claim for Taxes for a year or period that includes and ends after the Closing Date that may be the subject of indemnification by Seller pursuant to Section 5.3(a) and if the entire amount of such tax claim is subject to indemnification by Seller pursuant to Section 5.3(a), with the written consent of Purchaser (which shall not be unreasonably withheld or delayed), and at Seller's sole cost and expense) , Seller may assume the entire defense of such tax claim. Neither Purchaser nor the Company may agree to the extent such settle any Tax Claim is related to claim for the portion of such Straddle Period that is a Pre-the year or period ending prior to or on the Closing Tax Period, and Purchaser shall not settle such portion Date which may be the subject of such Tax Claim indemnification by Seller under Section 5.3(a) without the prior written consent of Seller’s consent, which ; provided that such consent may shall not be unreasonably withheld, conditioned withheld or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Sellers’ Representative in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding of the Purchaser or the Company which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writingArticle VI; provided, however, that the failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser’s right to indemnification under this Article V VI except to the extent extent, if any, that, but for such failure, the Sellers could have avoided all or a portion of the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Date, or otherwise relating provided that, and only to Taxes for which Seller may be liable the extent that, the Sellers acknowledge in writing their liability under this Agreement (other than to hold the Purchaser and the Company harmless against the full amount of any adjustment which may be made as a result of such audit or proceeding, the Sellers’ Representative shall have the right at his expense to participate in and control the conduct of such audit or proceeding; the Purchaser also may participate in any such audit or proceeding at its own expense and, if the Sellers’ Representative does not assume the defense of any such audit or proceeding, the Purchaser may defend the same in such manner as it may deem appropriate, including settling such audit or proceeding after fifteen days prior written notice to the Sellers’ Representative setting forth the terms and conditions of settlement. Notwithstanding anything to the contrary contained in Section 8.05, in the event that issues relating to a potential adjustment for which the Sellers have acknowledged liability are required to be contested in the same audit or proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, the Purchaser shall have the right, at its expense, to control the audit or proceeding with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereofthe latter issues; provided, however, that the Purchaser may, at its sole cost and expense, retain separate counsel of its choosing shall not have the right to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of settle any such Tax Claim matter without the consent of the Sellers’ Representative, which consent shall not be unreasonably withheld.
(c) Notwithstanding anything to the contrary contained in accordance Section 6.04, with respect to issues relating to a potential adjustment for which both the Sellers (as evidenced by their written acknowledgement under this Section 5.066.04) and the Purchaser or the Company could be liable, (i) Seller shall keep Purchaser reasonably apprised of both the status of the Tax Claim Sellers’ Representative and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and may participate in the audit or proceeding; (ii) the audit or proceeding shall be controlled by that party which would bear the burden of the greater portion of the sum of the adjustment and any corresponding adjustments that may reasonably be anticipated for future taxable periods; and (iii) the controlling party shall not settle any such matter without the consent of the non-controlling party (which consent shall not be unreasonably withheld). The principle set forth in this Section 6.04(c) also shall govern for purposes of deciding any issue that must be decided jointly (including choice of judicial forum) in situations in which separate issues are otherwise controlled under this Article VI by the Purchaser and the Sellers’ Representative.
(d) With respect to any Tax audit or proceeding for a taxable period that begins before the Closing Date, neither the Purchaser nor the Sellers’ Representative shall have enter into any compromise or agree to settle any claim pursuant to such audit or proceeding which would adversely affect the right to consentother party for such taxable period or a subsequent taxable period without the written consent of the other party, which consent may not be unreasonably withheld, conditioned or delayed, . The Purchaser and the Sellers’ Representative agree to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expensecooperate, and Seller shall have the right Purchaser agrees to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to cause the Company or any of its Subsidiaries; provided, however, thatto cooperate, in the case defense against or compromise of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate any claim in any such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned audit or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Sources: Stock Purchase Agreement (Lincoln Educational Services Corp)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller The Sellers and their duly appointed representatives shall have the right to elect exclusive authority to control the defense of any audit or examination by any taxing authority, to initiate any claim for refund, to amend any Tax Claim return and to contest, resolve and defend against any assessment for additional Taxes, notice of Tax deficiency or other adjustment of Taxes of or relating to taxable periods ending any liability of the Target or its Subsidiaries for Taxes reflected on or before the any Tax returns covering any Pre-Closing DatePeriods; PROVIDED, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, howeverHOWEVER, that Purchaser may(a) neither the Sellers nor any of their duly appointed representatives shall, at its sole cost and expense, retain separate counsel of its choosing to participate in without the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised prior written consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentBuyer, which consent may shall not be unreasonably withheld, conditioned file any claim for refund, amend any Tax return or delayed, to enter into any settlement to the extent such settlement would of any contest or otherwise compromise any issue that affects or may affect the Tax liability of the Buyer or any of its Affiliates for any Tax period beginning after the Closing Date (a "POST-CLOSING PERIOD") or any portion of an Overlap Period beginning after the Closing Date, and (b) neither the Sellers nor any of their duly appointed representatives shall, without the prior consent of the Buyer, which consent shall not unreasonably be withheld, enter into any settlement of any contest or otherwise compromise any issue that would increase any liability accruals for Taxes as of the Closing Date or would otherwise require payment by the Buyer of any amount under Section 9.3 unless the Sellers shall have agreed to indemnify the Buyer for payment of such Taxes. Buyer and its duly appointed representatives shall have the exclusive authority to control any audit or other proceeding relating to Taxes for which Purchaser any taxable year or its Affiliates may be liable for other taxable periods period ending after the Closing Date. If Seller elects not to control ; PROVIDED, HOWEVER, that (a) neither Buyer, the defense or thereafter fails or ceases to defend Target nor any such Tax Claimof their duly appointed representatives shall, Purchaser shall have without the right to control prior written consent of the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consentSellers, which consent may shall not be unreasonably withheld, conditioned or delayed, to enter into any settlement thereof to the extent such settlement would of any contest or otherwise compromise any issue that affects or may affect the amount Tax liability of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company Sellers or any of its Subsidiaries; providedtheir affiliates for any Pre-Closing Period or any portion of the Overlap Period ending on the Closing Date, howeverand (b) neither Buyer, thatthe Target nor any of their duly appointed representatives shall, in without the case prior consent of a Tax Claim with respect the Sellers, which consent shall not unreasonably be withheld, enter into any settlement of any contest or otherwise compromise any issue that would reduce any liability accruals for Taxes as of the Closing Date or would otherwise require payment by the Sellers of any amount under Section 9.3 unless Buyer shall have waived or caused to a Straddle Period, Seller be waived for itself and the Target any right to indemnification for Taxes from the Sellers. The Sellers shall be entitled to participate in such proceeding (at any Tax refund relating to the Target and its sole cost and expense) Subsidiaries to the extent such Tax Claim is related refund relates to the portion of such Straddle Period that is a any Pre-Closing Tax Period, and Purchaser shall not settle such Period or any portion of the Overlap Period ending on the Closing Date, unless such Tax Claim without refund has been recorded as an Asset on the Seller’s consent, Closing Balance Sheet in which consent may not case Buyer shall be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreemententitled thereto.
Appears in 1 contract
Contests. Whenever any Taxing Authority taxing authority asserts a claim, makes an assessmentassessment or otherwise disputes or affects the Tax reporting position of the Company for periods ending prior to the Closing Date, the Company shall, promptly upon receipt by Purchaser or the Company of notice thereof, inform the Stockholders, and the Stockholders shall have the right, at their expense, to control any resulting proceedings and to determine whether and when to settle any such claim, assessment or dispute, to the extent such proceedings affect the amount of Taxes with respect to which the Company and Purchaser are entitled to indemnification pursuant to Section 9.1, provided that the Stockholders shall not be entitled to settle any claim for Taxes that would have the consequence of adversely affecting the liability for Taxes of the Company or its Subsidiaries for any period after the Closing Date to any extent (including, but not limited to, the imposition of income tax deficiencies, reduction of asset basis or cost adjustments, the lengthening of any amortization or depreciation periods or the denial of amortization or depreciation deductions) without the prior written consent of Purchaser. Such consent shall not be unreasonably withheld and shall not be necessary to the extent the Stockholders have indemnified Purchaser and the Company against the effects of any such settlement. Purchaser, the Company and their representatives may also participate in any such proceedings at their own expense. Whenever any taxing authority asserts a claim, makes an assessment or otherwise disputes the amount of Taxes for with respect to which Seller may reasonably be expected the Company and Purchaser are not entitled to be liable under indemnification pursuant to Section 9.1 because such Taxes are not covered by the indemnification provisions set forth in this Agreement (a “Tax Claim”)Agreement, Purchaser shall upon receipt of notice of such Tax Claimthe Stockholders shall, promptly upon receiving notice thereof, inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced therebyPurchaser. Seller The Company shall have the right to elect control any resulting proceedings and to control the defense of any Tax Claim relating determine whether and when to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of settle any such Tax Claim in accordance with this Section 5.06claim, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentassessment or dispute, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement but only to the extent such settlement would proceedings affect the amount of Taxes for which the Company is not entitled to indemnification pursuant to Section 9.1. The Stockholders and their representatives may also participate in any such proceedings at their own expense. Purchaser shall not (and shall cause the Company not to) file or its Affiliates may be liable for taxable amend any Tax Return with respect to periods ending after on or prior to the Closing Date. If Seller elects not to Notwithstanding anything set forth herein, if a taxing authority requests an extension of the statute of limitations for assessment and the Stockholders control such proceeding, the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser extension shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to granted if the extent such settlement statute of limitations would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect extended to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to date after five years following the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementDate.
Appears in 1 contract
Sources: Recapitalization and Stock Purchase Agreement (American Axle & Manufacturing Holdings Inc)
Contests. Whenever (a) After the Closing, the Purchaser shall reasonably promptly after becoming aware notify the Seller in writing of the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding and shall also separately notify the Seller in writing of any demand or claim on the Purchaser or the Company which, makes if determined adversely to the taxpayer or after the lapse of time would be grounds for indemnification by the Seller under this Article VII. Such notice shall contain factual information (to the extent known to the Purchaser or the Company) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If the Purchaser fails to give the Seller reasonably prompt notice of an assessmentasserted Tax liability as required by this Section 7.04, then (i) if the Seller is precluded by the failure to give reasonably prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, then the Seller shall not have any obligation to indemnify for any loss or damage arising out of such asserted Tax liability, and (ii) if the Seller is not so precluded from contesting but such failure to give reasonably prompt notice results in an actual detriment to the Seller, then any amount which the Seller is otherwise disputes required to pay the Purchaser pursuant to this Article VII with respect to such liability shall be reduced by the amount of Taxes such detriment.
(b) The Seller, promptly after receiving notice, may elect to direct, through counsel of its own choosing and at its own expense, any audit, claim for refund and administrative or judicial proceeding involving any asserted liability with respect to which indemnity may be sought against the Seller under this Article VII (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "CONTEST"). If the Seller elects to direct the Contest of an asserted Tax liability, the Purchaser shall cooperate in all reasonable respects and shall cause the Company or its successor to cooperate in all reasonable respects, at the Seller's expense, in each phase of such Contest. If the Seller does not either reasonably promptly give notice to direct the Contest or commence the direction of the Contest or if it contests its obligation to indemnify under Section 7.01, the Purchaser or the Company may pay, compromise or contest, at its own expense, such asserted liability without waiving any of its rights to indemnification hereunder. However, in such case, neither the Purchaser nor the Company may settle or compromise any asserted liability over the objection of the Seller; PROVIDED, HOWEVER, that the Seller's consent to settlement or compromise shall not be unreasonably withheld or delayed. In any event, each of the Purchaser (or the Company) and the Seller may participate, at their own expense, in the Contest. If the Seller chooses to direct the Contest, the Purchaser shall promptly empower and shall cause the Company or its successor promptly to empower (by power of attorney and such other documentation as may be appropriate) such representatives of the Seller as it may designate to represent the Purchaser or the Company or its successor in the Contest insofar as the Contest involves an asserted Tax liability for which the Seller may reasonably be expected to would be liable under this Agreement (a “Tax Claim”)Article VII, Purchaser PROVIDED that the Seller shall upon receipt of notice of such Tax Claimnot, promptly inform Seller in writing; providedwithout the Purchaser's consent, however, that failure to give such notice as provided herein which shall not relieve Seller of its obligations under this Article V except be unreasonably withheld or delayed, (x) agree to the extent that Seller is materially prejudiced thereby. Seller shall have the right any settlement with respect to elect to control the defense of any Tax Claim relating to taxable if such settlement would likely materially adversely affect the future Tax liability of the Purchaser or the Company for any periods ending after the Reference Date other than through the use of losses or credits arising in periods or portions thereof ending on or before prior to the Closing DateReference Date or (y) agree to any settlement of such claim or cease to defend against such claim if, pursuant to or otherwise relating to Taxes for which Seller may as a result of such settlement or cessation, injunctive or other equitable relief would be liable under this Agreement (other than imposed against the Purchaser or the Company. If, with respect to a Straddle Period), at its sole cost and expense by written notice any proposed settlement referred to Purchaser within ten in clause (10x) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status previous sentence, the Seller proposes in good faith to settle a claim, suit, action or proceeding with respect to any Tax, which settlement offer is accepted by the relevant taxing authority, the Purchaser may elect to continue to contest such claim, suit, action or proceeding; PROVIDED that notwithstanding how such matter is ultimately settled or decided, the liability of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser Seller with respect thereto and to such claim, suit, action or proceeding shall be no greater than the amount which would have been payable if the Purchaser had consented to the settlement proposed by the Seller.
(iic) The Purchaser shall have the sole obligation and right to consentdirect, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and own expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to a Contest regarding any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings Tax Return relating to Taxes of or with respect to the Company for any taxable period commencing after the Reference Date (or any of its Subsidiaries; provided, however, that, the Closing Date in the case of a Tax Claim Return which is filed on a combined, consolidated, unitary or similar basis); PROVIDED, HOWEVER, that the Purchaser shall advise and consult with respect the Seller regarding the status of any such Contest that involves the Company and provided further that, without the prior written consent of the Seller (which shall not be unreasonably withheld or delayed), and except as provided in Section 7.04(b), the Purchaser shall not (i) make any election, change any annual accounting period or adopt or change any accounting method if any such election, adoption or change would have the effect of increasing the tax liability of the Seller in any tax period or portion thereof ending on or before the Reference Date, or (ii) file any amended return, enter into any closing agreement, settle any tax claim or assessment relating to the Company, surrender any right to claim a Straddle Periodrefund of Taxes, consent to any extension or waiver of the limitation period applicable to any tax claim or assessment relating to the Company or take any action, if any such amendment, agreement, settlement, surrender, consent or other action would have the effect of increasing the tax liability of the Seller shall be entitled to participate in such proceeding any tax period or portion thereof ending on or before the Reference Date (at its sole cost and expense) or the Closing Date in the case of a Tax Return which is filed on a combined, consolidated, unitary or similar basis), except to the extent the Seller is to be fully indemnified by the Purchaser against any such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned increase under Section 7.05 or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementotherwise.
Appears in 1 contract
Sources: Stock Purchase Agreement (White Mountains Insurance Group Inc)
Contests. Whenever (a) If any Taxing Tax Authority asserts a claimTax Claim with respect to Wind River or any of its Subsidiaries, makes an assessment, or otherwise disputes then the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of party first receiving notice of such Tax Claim, Claim promptly inform Seller in writingshall provide written notice thereof to the other party or parties; provided, however, that the failure of such party to give such prompt notice as provided herein shall not relieve Seller the other party of any of its obligations under this Article V 9, except to the extent that Seller the other party is materially actually prejudiced thereby. Seller Such notice shall specify in reasonable detail the basis for such Tax Claim and shall include a copy of the relevant portion of any correspondence received from the Tax Authority.
(b) The Trusts shall have the right to elect control, at their own expense, any audit, examination, contest, litigation or other proceeding with respect to control the defense of Taxes by or against any Tax Claim relating to Authority (a "Tax Proceeding") in respect of Wind River or any of its Subsidiaries for any taxable periods ending period that ends on or before the Closing Date, or otherwise relating Date but only to Taxes the extent that such Tax Proceeding relates to a potential adjustment for which Seller may be liable the Trusts have acknowledged in writing their liability under this Agreement (other than with respect to hold Cayman Purchaser, Wind River and its Subsidiaries harmless against the full amount of any adjustment that may be made as a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement result of such Tax Claim by SellerProceeding (or in the case of any taxable year that includes the Closing Date, against that portion of any adjustment allocable to the Pre-Closing Tax Period under Section 9.01(a)). If Seller timely elects to control the Trusts do not expressly assume the defense of any such Tax Claim in accordance Proceeding by providing Cayman Purchaser with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised written notice of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not Trusts' intent to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense Proceeding within 45 days after first receiving notice of such Tax Claims at its sole cost and expenseProceeding, and Seller shall have Cayman Purchaser may defend the right to consent, which consent same in such manner as it may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiariesdeem appropriate; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller that such 45-day period shall be entitled to participate in extended for such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller additional period as may be liable under reasonably necessary (but not to exceed an additional 45 days) in order to allow the Trusts to determine whether they should acknowledge liability as provided in this Agreement.Section 9.05(b); and provided further, that the Trusts shall reimburse Cayman Purchaser for its reasonable fees for attorneys and other outside consultants incurred during such additional
Appears in 1 contract
Contests. Whenever 23.1 After written notice to Landlord, Tenant may at its expense contest, by appropriate proceedings conducted in good faith and with due diligence (all such proceedings together with appeals therefrom being hereinafter referred to as "Contests") the amount, validity or application, in whole or in part, of any Taxing Authority asserts a Tax, mechanics' lien, encumbrance, charge or any other adverse claim for which Tenant is responsible under this Lease (hereinafter collectively "claims") provided that:
23.1.1 In the case of an unpaid claim, makes an assessmentsuch Contest shall operate to suspend the collection of the same from Landlord and Tenant therein;
23.1.2 Such Contest shall not result in a default under, and shall be permitted by and conducted in accordance with all applicable provisions of, the First Mortgage;
23.1.3 Tenant shall have furnished such security, if any, as may be required in the proceedings or requested by the First Mortgagee; and
23.1.4 Neither the Property nor any part thereof nor any interest therein shall be, in the reasonable opinion of Landlord, in imminent danger of being forfeited or lost.
23.2 During the period Tenant carries forward any such Contest in good faith, Tenant shall be relieved from its obligations herein contained to pay the claims, or otherwise disputes to clear the amount of Taxes for liens with respect to which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except contest is conducted. If and to the extent that Seller is materially prejudiced thereby. Seller Tenant shall have not prevail in any such Contest, Tenant shall immediately pay and discharge the right claim in question to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller such extent.
23.3 All such Contests may be liable under this Agreement (brought by Tenant in the name of Tenant or, if reasonably necessary, in the name of Landlord or Tenant and Landlord, as may be appropriate. Each party agrees to cooperate with the other than in such Contests, short of the payment of money with respect thereto, except where this Lease otherwise requires payment. Each party will endorse such pleadings, checks and other documents as will be appropriate to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in carry out the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions purposes of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement23.3.
Appears in 1 contract
Contests. Whenever (a) If notice of any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes Legal Action with respect to Taxes (“Tax Proceeding”) relating to the amount of Taxes Seller shall be received by either party for which Seller the other party may reasonably be expected to be liable under this Agreement pursuant to Section 8.05 (a “Tax Claim”), Purchaser the notified party shall upon receipt of notice promptly inform the other party in writing of such Tax Claim, promptly inform Seller in writing; provided, however, provided that the failure of the notified party to give the other party such notice as provided herein shall not relieve Seller the failing party of its obligations under this Article V Section 8.05 except to the extent that Seller the other party is actually and materially prejudiced thereby. Seller .
(b) Company shall have the right at its expense to elect to control represent the defense interests of Company or the Seller in any Tax Claim relating exclusively to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement provided that: (other than with respect to a Straddle Period), at i) Company shall allow Buyer and its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of any such Tax Claim by Seller. If Proceeding at Buyer’s sole expense; (ii) Company shall keep Buyer informed with respect to the status of any such Tax Proceeding; (iii) if any such Tax Proceeding involves an issue that recurs in taxable periods ending after the Closing Date or otherwise could adversely affect Buyer or the Seller timely elects to for any taxable period ending after the Closing Date, then Company and Buyer shall jointly control the defense of any such Tax Claim in accordance Proceeding, each party shall cooperate with this Section 5.06the other party, (i) Seller and there shall keep Purchaser reasonably apprised be no settlement or closing or other agreement with respect to such Tax Proceeding without the consent of the status other party, which consent shall not be unreasonably withheld; and (iv) if Company does not elect to represent the interests of Company or the Seller in any such Tax Proceeding, then Buyer or the Seller may contest such Tax Proceeding and may pay or compromise such Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to Company’s written consent, which consent may shall not be unreasonably withheld.
(c) Buyer shall represent at its expense the interests of the Seller in any Tax Claim relating to a Straddle Period, conditioned or delayed, provided that: (i) Buyer shall allow Company and its counsel to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control participate in the defense or thereafter fails or ceases to defend of any such Tax ClaimProceeding at Company’s sole expense; (ii) Buyer shall keep Company informed with respect to the status of any such Tax Proceeding; and (iii) if any such Tax Proceeding involves an issue which is the subject of indemnification by Company pursuant to Section 8.05, Purchaser then Buyer and Company shall have the right to jointly control the defense of any such Tax Claims at its sole cost and expenseProceeding, each party shall cooperate with the other party, and Seller there shall have be no settlement or closing or other agreement with respect to such Tax Proceeding without the right to consentconsent of the other party, which consent may shall not be unreasonably withheld, conditioned or delayed, to any settlement thereof .
(d) Notwithstanding anything in the Agreement to the extent such settlement would affect the amount of Taxes for which Seller may contrary, Company shall be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right entitled to control in all respects, and neither Buyer nor any proceedings relating of their Affiliates shall be entitled to Taxes of or participate in, any Tax Proceeding with respect to the to: (i) any Tax Return of Company; or (ii) any Tax Return of a consolidated, combined, affiliated, or unitary group that includes Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding Affiliates (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without including the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement).
Appears in 1 contract
Contests. Whenever (i) Seller and Buyer shall notify the other Party in writing within fourteen (14) days or such shorter period as may be required thereby of receipt by it or any Taxing Authority asserts of its Affiliates of written notice of any pending or threatened Tax examination, audit or other administrative or judicial proceeding (a “Tax Contest”) that could reasonably be expected to result in an indemnification obligation of such other Party pursuant to this Agreement and such timely notice shall specify in reasonable detail the basis for any claim included therein and shall include a copy of the relevant portion of any correspondence received from the taxing authority. If the recipient of such notice of a Tax Contest fails to provide such timely notice to such other Party, it shall not be entitled to indemnification for any Taxes arising in connection with such Tax Contest, but only to the extent, if any, that such failure or delay shall have adversely affected the indemnifying Party’s ability to defend against, settle, or satisfy any action, suit or proceeding against it, or any damage, loss, claim, makes an assessmentor demand for which the indemnified Party is entitled to indemnification hereunder, and the indemnifying Party’s indemnity obligations shall be reduced to the extent of any Tax or otherwise disputes other liability incurred as a result of the amount of delay or failure to receive such timely notice.
(ii) If a Tax Contest relates to any Taxes for which Seller may reasonably be expected to be is liable under this Agreement (a “Tax Claim”)in full hereunder, Purchaser Seller shall upon receipt of notice at its expense control the defense and settlement of such Tax ClaimContest. If such Tax Contest relates to any Taxes for which Buyer is liable in full hereunder, promptly inform Seller Buyer shall at its own expense control the defense and settlement of such Tax Contest. The Party not in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller control of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller defense shall have the right to elect to control observe the defense conduct of any Tax Claim relating to taxable periods ending on Contest at its expense, including through its own counsel and other professional experts. Buyer and Seller shall jointly represent CEM, CPI, any Investor Subsidiary, any Service Subsidiary or before the Closing Date, or otherwise any Project Company in any Tax Contest relating to Taxes for which Seller may both are liable hereunder, and fees and expenses related to such representation shall be liable under this Agreement paid equally by Buyer and Seller.
(other than with respect iii) Notwithstanding anything to a Straddle Periodthe contrary in Section 6.9(d)(ii), at its sole cost to the extent that an issue raised in any Tax Contest controlled by one Party or jointly controlled could materially affect the liability for Taxes of the other Party, the controlling Party shall not, and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate neither Party in the defense or case of joint control shall, enter into a final settlement of such Tax Claim by Seller. If Seller timely elects to control without the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentother Party, which consent may shall not be unreasonably withheld, conditioned or delayed, . Where a Party reasonably withholds its consent to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser final settlement, that Party may continue or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claiminitiate further proceedings, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and own expense, and Seller the liability of the Party that wished to settle (as between the consenting and the non-consenting Party) shall not exceed the liability that would have resulted from the right proposed final settlement including interest, additions to consentTax, which consent may not be unreasonably withheldand penalties that have accrued at that time, conditioned or delayed, to and the non-consenting Party shall indemnify the consenting Party for any settlement thereof liability in excess of liability that would have resulted from the proposed final settlement.
(iv) Notwithstanding any other provision of this Agreement to the extent such settlement would affect the amount of contrary, if a Tax Contest results in an increase in Income Taxes for which Seller may be is liable under this Agreement. Except as otherwise required hereunder and such increase is attributable to adjustments based on timing differences which will reverse in Tax periods ending subsequent to the Closing Date, Buyer shall promptly pay to Seller, upon Seller's written request, an amount equal to the present value of the reduction in Income Taxes payable by the foregoing provisions Buyer and its Affiliates in future Tax periods by reason of this Section 5.06such reversal, Purchaser shall have the right to control any proceedings relating to determined by using a discount rate of 6% and an assumed Tax rate of 40%, and by assuming that such reduction in Income Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, will occur in the case year or years of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementreversal.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Mdu Resources Group Inc)
Contests. Whenever any Taxing Authority asserts a claim(i) After the Closing Date, makes an assessmentthe Purchaser shall, or shall cause the Purchased Subsidiary to, notify the Sellers in writing promptly upon the commencement of any Tax audit or administrative or judicial proceeding or the receipt by the Purchaser or the Purchased Subsidiary of any request issued by any Taxation Authority for documents in connection with Taxes which are the subject of the indemnities provided for in Section 5.11(a) (but in any event within no later than ten (10) Business Days of such receipt by the Purchaser or the Purchased Subsidiary) which, could give rise to a Sellers' liability under Section 5.11, provided the giving of such notice will not be a condition precedent to the liability of the Sellers under this Section 5.11, and shall also separately notify the Sellers in writing of any proposed or final demand or claim on the Purchaser or the Purchased Subsidiary which, if determined adversely to the taxpayer or after the lapse of time, would be grounds for indemnification by the Tax Indemnifying Parties under Section 5.11(a). Each such notice shall contain factual information (to the extent known to the Purchaser or the Purchased Subsidiary) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax liability.
(ii) If the Purchaser or the Purchased Subsidiary fail to give the Sellers prompt notice of an asserted Tax liability as required by Section 5.11(h)(i) and if the Sellers are precluded by such failure to give prompt notice from contesting the asserted Tax liability in both the administrative and judicial forums, the Sellers shall not have any obligation to indemnify for any loss or damage arising out of such asserted Tax liability, and (ii) if the Sellers are not so precluded from contesting but such failure to give prompt notice results in additional liabilities, expenses or other detriment to the Sellers, then any amount which the Sellers otherwise disputes are required to pay to the Purchaser or the Purchased Subsidiary pursuant to this Section 5.11 with respect to such liability shall be reduced by the amount of Taxes such detriment; provided however, that such detriment is duly substantiated by the Sellers.
(iii) The Sellers may direct, through counsel of their own choosing and at their own expense, any audit, claim for refund and administrative or judicial proceeding to the extent it involves any asserted liability with respect to which indemnity by the Sellers may be sought under this Section 5.11 (any such audit, claim for refund or proceeding relating to an asserted Tax liability are referred to herein collectively as a "Contest"). If the Sellers choose to direct the Contest, the Purchaser or the Purchased Subsidiary, as applicable, shall promptly empower (by power of attorney and such other documentation as may be appropriate) such of Sellers' representatives as Sellers may designate to represent the Purchaser or the Purchased Subsidiary insofar as the Contest involves an asserted Tax liability for which Seller may reasonably be expected to the Sellers would be liable under this Agreement Section 5.11.
(iv) The Sellers shall consult with respect to, and a “Tax Claim”)reasonable amount of time in advance of, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense settlement of any Tax Claim relating Contest controlled by the Sellers pursuant to taxable periods ending on this paragraph, and the Sellers may not settle any such Contest or before the Closing Datetransmit any material communication (whether oral, in writing or otherwise) to any Taxation Authority in connection with such Contest, or otherwise relating transmit any material communication (whether oral, in writing or otherwise) to Taxes for which Seller may be liable under this Agreement (other than any Taxation Authority in connection with respect to a Straddle Period)such Contest, at its sole cost and expense by without the prior written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised consent of the status of Purchaser or the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and Purchased Subsidiary, as applicable (ii) Purchaser shall have the right to consent, which consent may shall not be unreasonably withheld, conditioned withheld or delayed).
(v) If the Sellers elect not to direct the Contest, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates the Purchased Subsidiary, as the case may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense be, may pay, compromise or thereafter fails or ceases to defend any contest such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expenseasserted liability as it sees fit, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required reimbursed by the foregoing provisions Sellers for reasonable costs of this Section 5.06, Purchaser outside tax advisors and related professionals and reasonable out of pocket costs (for all of which appropriate supporting documentation shall have the right to control any proceedings relating to Taxes of or be provided) incurred in connection with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect liability ultimately determined to a Straddle Period, Seller shall be entitled to participate in such proceeding indemnifiable by the Sellers hereunder.
(at its sole cost and expensevi) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, The Sellers and Purchaser shall not settle such portion cooperate in respect of such any Contest. Such cooperation and information shall include providing copies of relevant Tax Claim without Returns or portions thereof, together with accompanying schedules and related work papers and documents relating to rulings or other determinations by Taxation Authorities. The Sellers and the Seller’s consentPurchaser will make themselves (and their respective employees) available, which consent may not be unreasonably withheldon a mutually convenient basis, conditioned to provide explanations of any documents or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable information provided under this AgreementSection 5.11.
Appears in 1 contract
Sources: Asset Purchase Agreement (Tropical Sportswear International Corp)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of i) The ▇▇▇▇▇ Representative and its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller duly appointed representatives shall have the right to elect authority to control the defense any audit or examination by any taxing authority, and contest, resolve and defend against any assessment for additional Taxes, notice of any Tax Claim deficiency or other adjustment of Taxes of or relating to taxable periods ending on or before the Closing Dateany liability of ▇▇▇▇▇ and its subsidiaries for all ▇▇▇▇▇ PRE-CLOSING Periods; PROVIDED, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, howeverHOWEVER, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in neither the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of ▇▇▇▇▇ Representative nor any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised duly appointed representative of the status ▇▇▇▇▇ Representative shall, without the prior consent of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentUbiquiTel Parent, which consent may shall not be unreasonably withheld, conditioned or delayed, to enter into any settlement to of any contest or otherwise compromise any issue that would have a material adverse effect on the extent such settlement would affect the amount Tax benefits of Taxes for which Purchaser UbiquiTel Parent or its Affiliates may be liable ▇▇▇▇▇ or any subsidiary for taxable periods years ending after the Closing DateCLOSING DATE. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser UbiquiTel Parent and its duly appointed Representatives shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right exclusive authority to control any proceedings relating to audit or examination by any taxing authority, initiate any claim for refund, amend any Tax Return and contest, resolve and defend against any assessment for additional Taxes, notice of Tax deficiency or other adjustment of Taxes of or with respect relating to any liability of ▇▇▇▇▇ and its subsidiaries for Taxes for any taxable year or other taxable period ending after the Company or CLOSING DATE (the "POST-CLOSING PERIODS"); PROVIDED, HOWEVER, that (a) none of UbiquiTel Parent, ▇▇▇▇▇, its subsidiaries nor any of its Subsidiaries; providedtheir duly appointed representatives shall, howeverwithout the prior written consent of the ▇▇▇▇▇ Representative, that, in enter into any settlement of any contest or otherwise compromise any issue that adversely affects the case liability of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle ▇▇▇▇▇ Stockholders for any ▇▇▇▇▇ PRE-CLOSING Period that is a Pre-Closing Tax PeriodTaxes, and Purchaser shall not settle such portion (b) none of such Tax Claim UbiquiTel Parent, ▇▇▇▇▇, its subsidiaries nor any of their duly appointed representatives shall, without the Seller’s consentprior consent of the ▇▇▇▇▇ Representative, which consent may not be unreasonably withheld, conditioned enter into any settlement of any contest or delayed, if such settlement otherwise compromise any issue that would affect require payment by the Controlling ▇▇▇▇▇ Stockholders (as defined herein) of any amount of Taxes for which Seller may be liable under this AgreementAgreement unless UbiquiTel Parent shall have waived or caused to be waived for itself and ▇▇▇▇▇ and its subsidiaries any right to indemnification for Taxes from the Controlling ▇▇▇▇▇ Stockholders.
Appears in 1 contract
Contests. Whenever (a) If a claim shall be made by any Taxing Authority asserts that, if successful, would result in the indemnification of a claim, makes an assessment, or otherwise disputes party (the amount of Taxes for which Seller may reasonably be expected to be liable “Tax Indemnified Party”) under this Agreement Article VII, the Tax Indemnified Party shall promptly notify the party (the “Tax Indemnifying Party”) obligated under this Article VII to indemnify the Tax Indemnified Party in writing of such fact; otherwise, the Tax Indemnifying Party shall be released from any indemnification obligations with respect to such claim to the extent the Tax Indemnifying Party is actually prejudiced by such failure to notify or delay in notification. Such notice shall contain factual information (to the extent known to the Tax Indemnified Party) describing the asserted Tax liability in reasonable detail and shall include copies of any notice or other document received from any Taxing Authority in respect of such asserted Tax liability.
(b) In the case of a claim or assessment with respect to Tax by a Taxing Authority or in the case of a Tax audit or administrative or judicial proceeding (a “Tax ClaimContest”)) that relates to a Pre-Closing Taxable Period or otherwise to a matter for which ABB is primarily liable under Section 7.01 or 7.02, Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller ABB shall have the right to elect sole right, at its expense, to control the defense conduct of any Tax Claim relating such Contest provided ABB acknowledges its liability. Purchaser and ABB agree to taxable periods ending on or before cooperate, and Purchaser agrees to cause the Closing Daterelevant OGP Purchasers and OGP Subsidiaries to cooperate, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense against or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense compromise of any such Tax Claim claim in accordance with this Section 5.06any audit or proceeding, including by executing appropriate powers of attorney empowering ABB Representatives. Notwithstanding the foregoing, (i) Seller ABB shall keep not agree to any settlement concerning Taxes with respect to Pre-Closing Taxable Periods, which would materially disadvantage Purchaser reasonably apprised or the OGP Subsidiaries without the prior written consent of the status of the Tax Claim and the defense thereof and Purchaser, which shall reasonably consider recommendations made by Purchaser with respect thereto not be unreasonably withheld, and (ii) Purchaser shall have not agree to any settlement concerning Taxes with respect to Pre-Closing Taxable Periods which would materially disadvantage ABB without the right to consentprior written consent of ABB, which consent may shall not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount . Each of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, ABB and Purchaser shall have the right to control the defense be kept fully informed of such Tax Claims at its sole cost any material developments and expense, receive copies of all correspondence and Seller shall have the right to consentobserve the conduct of any Tax Contest (through attendance at meetings) at its own expense, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementincluding through its own counsel and other professional experts. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the In a case of a Tax Claim with respect Contest relating to a Straddle Period, Seller (i) each of Purchaser and ABB may participate in such Contest at its own expense, and (ii) whichever of Purchaser and ABB would be liable for the greatest amount of Tax asserted in such Contest (determined on a present value basis) shall be entitled to participate in control such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementContest.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim11.2.1. After the Closing, makes an assessment, Buyer shall promptly notify the Stockholders’ Representative in writing of the proposed assessment or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense commencement of any Tax Claim relating Action or of any demand or claim on any Buyer Indemnified Person that, if determined adversely to the taxpayer or after the lapse of time, could be grounds for indemnification by the Company Securityholders pursuant to this Agreement. Such notice shall contain factual information describing the asserted Tax Liability in reasonable detail and shall include copies of any notice or other document received from any Governmental Authority in respect of any such asserted Tax Liability.
11.2.2. In the case of a Tax Action that relates to a taxable periods period ending on or before the Closing Date and in respect of which the Company Securityholders could have an indemnification obligation pursuant to this Agreement, after taking into account the provisions hereof (a “Contest”), and provided such Tax Action does not affect the Taxes of Buyer or its Affiliates (including the Surviving Corporation) in a taxable period (or portion thereof) beginning after the Closing Date, or otherwise relating the Stockholders’ Representative shall have the sole right, on behalf of the Company Securityholders and at their expense to Taxes for which Seller participate in the defense of any Contest that is the subject of notice given by Buyer pursuant to Section 11.2.1 and the right to control the conduct of such Contest with counsel of their choice reasonably satisfactory to Buyer so long as the Stockholders’ Representative notifies Buyer in writing within fifteen (15) days after Buyer has given notice of the Contest that the Company Securityholders will control such Contest. Buyer may be liable under this Agreement (other than with respect to a Straddle Period), retain separate co-counsel at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense of the Contest. Neither the Company Securityholders nor the Stockholders’ Representative will consent to the entry of any judgment or enter into any compromise or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have to a Contest without the right prior written consent of Buyer, such consent not to consent, which consent may not be unreasonably withheld, conditioned or delayed. If Stockholders’ Representative does not deliver the notice contemplated by clause (i) above within fifteen (15) days after Buyer has given notice of a Contest, to any settlement to the extent or if such settlement would Contest does affect the amount Taxes of Taxes for which Purchaser Buyer or its Affiliates may be liable for (including the Surviving Corporation) in a taxable periods ending period beginning after the Closing Date. If Seller elects not to , Buyer shall control such Contest; provided that the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims Stockholders’ Representative may retain separate co-counsel at its sole cost and expense, expense and Seller shall have participate in the right to consent, which consent defense of the Contest and Buyer may not consent to the entry of any judgment or enter into any compromise or settlement with respect to the Contest without the prior written consent of the Stockholders’ Representative, such consent not to be unreasonably withheld, conditioned or delayed, to any settlement thereof . Notwithstanding anything to the extent such settlement would affect the amount of Taxes for which Seller may be liable under contrary in this Agreement. Except as otherwise , Buyer shall not be required by to provide any access to or to permit any inspection of any Tax Return of the foregoing provisions Affiliated Group of this Section 5.06the Buyer or its Affiliates (including, Purchaser shall have for the right to control any proceedings relating to Taxes avoidance of or doubt, with respect to the Company or any of its Subsidiaries; providedfollowing the Closing Date), however, that, in and the case of a Tax Claim with respect to a Straddle Period, Seller Stockholders’ Representative shall be entitled to not participate in such proceeding (at its sole cost and expense) or control any Contest to the extent such Contest relates to any Tax Claim is related Return of the Affiliated Group of the Buyer or its Affiliates; provided that if the Company Securityholders could have an indemnification obligation pursuant to the portion this Agreement in respect of such Straddle Period that is a PreContest, the Buyer (i) shall keep the Stockholders’ Representative reasonably informed of the on-Closing Tax Period, going proceeding and Purchaser (ii) shall not settle or compromise such portion of such Tax Claim Contest without the Seller’s consentprior written consent of the Stockholders’ Representative, which consent may (A) shall not to be unreasonably withheld, delayed or conditioned and (B) shall be based on such information (other than such Tax Returns of the Affiliated Group of the Buyer or delayedits Affiliates), if calculations and methodologies provided by the Buyer (and certified by the an officer of the Buyer) as are reasonably necessary for the Stockholders’ Representative to provide such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.consent. 74163855_1
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes In the case of an assessment, audit or otherwise disputes the amount of Taxes for which Seller may reasonably be expected administrative or judicial proceeding that relates to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing DateDate or for which Buyer may seek indemnity from Seller, Seller shall have the right, at its expense, to participate in and control the conduct of such audit or otherwise relating proceeding but only to Taxes the extent that such audit or proceeding relates to a potential adjustment for which Seller may be liable has acknowledged liability to Buyer under this Agreement (other than Agreement. Seller shall keep Buyer fully informed of the progress of any such audit or proceeding, and Buyer may also participate in any such audit or proceeding at its expense. Notwithstanding the foregoing, Seller may not pay, discharge, settle, compromise or otherwise dispose of any audit or proceeding with respect to a Straddle Periodthe Company Group without the prior written consent of Buyer (which consent shall not be unreasonably withheld or delayed), at its sole cost ; provided that no Buyer consent shall be required to settle or otherwise dispose of the Sales and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate Use Tax Audits in the defense event that Buyer and the Company Group are not financially liable and no wrongdoing on behalf of Buyer or the Company Group is admitted in connection with such settlement of such Tax Claim by Selleror disposition. If Seller timely elects to control does not assume the defense of any such Tax Claim audit or proceeding promptly, Buyer may defend and settle the same (for Seller’s account and at Seller’s expense) in accordance with this Section 5.06such reasonable manner as it may deem appropriate. In the event that a potential adjustment as to which Seller would be liable is present in the same proceeding as another potential adjustment for which Buyer would be liable, Buyer shall have the right, at its expense, to control such audit or proceeding. With respect to a potential adjustment for which both Seller, on the one hand, and Buyer or the Company Group, on the other hand, could be liable, or which involves an issue that recurs or affects related tax items for any period ending after the Closing Date (whether or not the subject of audit as such time), (i) both Buyer and Seller shall keep Purchaser reasonably apprised of may participate in the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto audit or proceeding, each at its own expense, and (ii) Purchaser the audit or proceeding shall have be controlled by Buyer. Notwithstanding the right to consentforegoing, which consent Buyer may not be unreasonably withheldpay, conditioned discharge, settle, compromise or delayed, to otherwise dispose of any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser audit or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim proceeding with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes potential adjustment for which Seller may could be liable under without the prior written consent of Seller (which consent shall not be unreasonable withheld or delayed); provided that no Seller consent shall be required in the event that Seller is not financially liable and no wrongdoing on behalf of Seller is admitted. In the event of a conflict between a provision in this AgreementSection 8.04(f) and a provision in Section 9.07, the provision in this Section 8.04(f) shall control.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Rentech Nitrogen Partners, L.P.)
Contests. Whenever (a) After the Closing, the Purchaser shall promptly notify the Sellers in writing of any Taxing Authority asserts written notice of a claimproposed assessment or claim in an audit or administrative or judicial proceeding of the Purchaser or of any of the Partnership and the Subsidiaries which, makes an assessmentif determined adversely to the taxpayer, or otherwise disputes the amount of Taxes would be grounds for which Seller may reasonably be expected to be liable indemnification under this Agreement (a “Article VI or could otherwise result in any Tax Claim”), Purchaser shall upon receipt cost to any of notice of such Tax Claim, promptly inform Seller in writingthe Sellers; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations affect the Purchaser's right to indemnification under this Article V VI except to the extent such failure on the part of the Purchaser or any Affiliate of the Purchaser prejudices the Sellers by preventing the avoidance of all or a portion of the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right relates to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable provided that the Sellers acknowledge in writing their indemnification obligation liability under Article VI of this Agreement (other than with respect to the potential liability of the Purchaser, the Partnership or any Subsidiary as a Straddle Period)result of such audit or administrative or judicial proceeding, the Sellers (or the Parent Entities, as the case may be) shall have the right, at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and their expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Seller. If Seller timely elects audit or proceeding; the Purchaser may also participate in any such audit or proceeding but only if such audit or proceeding relates to control non-income Taxes and, if the Sellers do not assume the defense of any such Tax Claim audit or proceeding, the Purchaser, at its expense, may defend the same in accordance such manner as it may deem appropriate, including, but not limited to, settling such audit or proceeding after giving five days' prior written notice to the Sellers setting forth the terms and conditions of settlement. In the event that issues relating to a potential adjustment for which the Sellers have acknowledged their indemnification obligation are required to be dealt with this Section 5.06in the same proceeding as separate issues relating to a potential adjustment for which the Purchaser would be liable, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right right, at its expense, to consentcontrol the audit or proceeding with respect to the latter issues, provided that the Purchaser provides the Sellers with a written acknowledgement of the Purchaser's liability.
(c) Notwithstanding Section 6.04(b), neither the Purchaser nor the Sellers shall enter into any compromise or agree to settle any claim pursuant to any Tax audit or proceeding, including without limitation a Federal, state or local income Tax audit or 49 44 proceeding to the extent it involves Partnership items, which would adversely affect the other party for such year or any prior or subsequent year without the written consent of the other party which consent may not be unreasonably withheld. If the Purchaser or the Sellers refuse to provide the respective other party with written consent to settle any such claim, conditioned then the parties shall submit the matter to an Independent Firm and the Independent Firm shall resolve the issue based on a standard of maximal fairness to both the Purchaser and the Sellers.
(d) The Purchaser and the Sellers (or delayedthe Parent Entities, to any settlement as the case may be) shall cooperate fully, as and to the extent reasonably requested by the other party, in connection with (i) the filing of Returns pursuant to Section 6.03 (including such settlement would affect the amount of Taxes amended Returns for which Purchaser periods (or its Affiliates may be liable for taxable periods portions thereof) ending after on or prior to the Closing Date. If Seller elects not Date that the Sellers or the Parent Entities may reasonably request the Purchaser to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiariesfile; provided, however, that, that if in the Purchaser's reasonable judgment the filing of the amended return would be disadvantageous to the Purchaser, the Purchaser may deny the Sellers' or the Parent Entities' request and the parties shall submit the matter to an Independent Firm and the Independent Firm shall resolve the issue based on a standard of maximal fairness to both the Purchaser and the Sellers or the Parent Entities, as the case of a Tax Claim may be]) and (ii) any audit, litigation or other proceeding with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementTaxes.
Appears in 1 contract
Sources: General Partnership Interest Purchase Agreement (Galileo International Inc)
Contests. Whenever (a) Stockholder and the Buyer shall notify the other party in writing within thirty (30) days of receipt of written notice of any Taxing Authority asserts pending or threatened tax examination, audit or other administrative or judicial proceeding (a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may "TAX CONTEST") that could reasonably be expected to result in an indemnification obligation of such other party pursuant to this Agreement. If the recipient of such notice of a Tax Contest fails to provide such notice to the other party, it shall not be entitled to indemnification for any Taxes arising in connection with such Tax Contest, but only to the extent, if any, that such failure or delay shall have adversely affected the indemnifying party's ability to defend against, settle, or satisfy any action, suit or proceeding against it, or any damage, loss, claim or demand for which the indemnified party is entitled to indemnification hereunder.
(b) If a Tax Contest relates to any Taxes for which the Stockholder is liable under this Agreement (a “Tax Claim”)in full hereunder, Purchaser shall upon receipt of notice the Stockholder shall, at its expense, control the defense and settlement of such Tax ClaimContest. If such Tax Contest relates to any Taxes for which Buyer is liable in full hereunder, promptly inform Seller Buyer shall, at its own expense, control the defense and settlement of such Tax Contest. The party not in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller control of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller defense shall have the right to elect to control observe the defense conduct of any Tax Claim relating to taxable periods ending on Contest at its expense, including through its own counsel and other professional experts. Buyer and the Stockholder shall jointly represent the Company or before the Closing Date, or otherwise any Subsidiary in any Tax Contest relating to Taxes for which Seller may both are liable hereunder, and fees and expenses related to such representation shall be liable under this Agreement paid by the Buyer and the Stockholder in proportion to their respective liabilities.
(other than with respect c) Notwithstanding anything to a Straddle Periodthe contrary in Section 12.06(b), at its sole cost to the extent that an issue raised in any Tax Contest controlled by one party or jointly controlled could materially affect the liability for Taxes of the other party, the controlling party shall not, and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate neither party in the defense or case of joint control shall, enter into a final settlement of such Tax Claim by Seller. If Seller timely elects to control without the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentother party, which consent may shall not be unreasonably withheld, conditioned or delayed, . Where a party withholds its consent to any final settlement, that party may continue to initiate further proceedings, at its own expense, and the liability of the party that wished to settle (as between the consenting and non-consenting party) shall not exceed the liability that would have resulted from the proposed final settlement including interest, additions to Tax, and penalties that have accrued at that time, and the non-consenting party shall indemnify the consenting party for such Taxes.
(d) Notwithstanding any other provision of this Agreement to the extent such settlement would affect the amount of contrary, if a Tax Contest results in an increase in Taxes for which Purchaser or its Affiliates may be the Stockholder is liable for hereunder, and such increase is attributable to adjustments based on timing differences which will reverse in taxable periods ending after subsequent to the Closing Date. If Seller elects not , and, Buyer shall pay to control the defense or thereafter fails or ceases Stockholder, upon the Stockholder's request, an amount equal to defend any such Tax Claim, Purchaser shall have the right to control present value of the defense reduction in Taxes payable by the Buyer and its Affiliates in future taxable periods by reason of such Tax Claims at its sole cost reversal, determined by using a discount rate of 12% and expensean assumed tax rate of 40%, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent by assuming that such settlement would affect the amount of reduction in Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, will occur in the case year or years of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementreversal.
Appears in 1 contract
Contests. Whenever (a) After the Closing, Buyer shall promptly notify Goldcorp USA in writing of the proposed assessment or the commencement of any Taxing Authority asserts a claimTax audit or administrative or judicial proceeding or of any demand or claim on Buyer, makes an assessmentits Affiliates, Marigold or otherwise disputes any subsidiary which, if determined adversely to the amount taxpayer or after the lapse of Taxes time, could be grounds for which Seller may reasonably be expected indemnification by Goldcorp USA. Such notice shall contain factual information (to be liable under this Agreement (a “the extent known to Buyer, its Affiliates, Marigold or any subsidiary) describing the asserted Tax Claim”), Purchaser liability in reasonable detail and shall upon receipt include copies of any notice or other document received from any taxing authority in respect of any such asserted Tax liability. If Buyer fails to give Goldcorp USA prompt notice of an asserted Tax liability as required by this Section 10.4, then Goldcorp USA shall not have any obligation to indemnify for any loss arising out of such asserted Tax Claimliability, promptly inform Seller in writing; provided, however, but only to the extent that failure to give such notice as provided herein shall not relieve Seller results in a detriment to Goldcorp USA.
(b) In the case of its obligations under this Article V except to the extent a Tax audit or administrative or judicial proceeding (a “Contest”) that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates to taxable periods ending on or before the Closing Date, or otherwise relating Goldcorp USA shall have the sole right, at its expense, to Taxes for which Seller control the conduct of such Contest.
(c) With respect to a taxable period that begins prior to the Closing Date and ends after the Closing (a “Straddle Period”), Goldcorp USA may be liable under this Agreement (other than elect to direct and control, through counsel of its own choosing, any contest involving any asserted Tax liability with respect to which indemnity may be sought from Goldcorp USA. If Goldcorp USA elects to direct a Straddle Period)Contest, at its sole cost and expense by written notice to Purchaser Goldcorp USA shall within ten (10) 90 days of receipt of the notice thereofof asserted Tax liability notify Buyer of its intent to do so, and Buyer shall cooperate and shall cause Marigold and its Affiliates to fully cooperate, at Goldcorp USA’s expense, in each phase of such Contest. If Goldcorp USA elects not to direct the Contest, Buyer, Marigold or any subsidiary may assume control of such Contest (at Buyer’s expense). However, in such case, none of Buyer, Marigold or any subsidiary may settle or compromise any asserted liability without prior written consent of Goldcorp USA; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing consent to participate in the defense settlement or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller compromise shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld. In any event, conditioned Goldcorp USA may participate, at its own expense, in the Contest.
(d) Buyer and Sellers agree to cooperate, and Buyer agrees to cause Marigold to cooperate, in the defense against or delayedcompromise of any claim in any Contest.
(e) For purposes of this Agreement, to any settlement Taxes allocable to the extent such settlement would affect portion of a Straddle Period ending on the Closing Date (i) in the case of any Taxes other than Income Taxes, Nevada State Net Proceeds of Mineral Taxes and Taxes based on receipts or sales or that are otherwise transactionally based shall be deemed to be the amount of such Tax for the entire Straddle Period multiplied by a fraction, the numerator of which is the number of days in the taxable period prior to and ending on the Closing Date and the denominator of which is the number of days in the entire Straddle Period, (ii) in the case of Taxes for based on receipts or sale or that are otherwise transactionally based, other than Income Taxes and the Nevada State Net proceeds of Mineral Taxes, shall be deemed equal to the amount which Purchaser or its Affiliates may would be liable for taxable periods ending after payable if the relevant Straddle Period ended on the Closing Date. If Seller elects not to control , provided that all permitted allowances, credits, exemptions and deductions that are normally computed on the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser basis of an entire year period shall have accrue on a daily basis and shall be allocated between the right to control pre-Closing portion of the defense Straddle Period and the post-Closing portion of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof Straddle Period in proportion to the extent number of days in each such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiariesperiod; provided, however, thatthat any credits relating to a Straddle Period shall be taken into account as though the relevant taxable period ended on the Closing Date and provided further that all determinations necessary to give effect to the foregoing allocations shall be made in a manner consistent with prior practices of Marigold, in except where such practice is not consistent with applicable legal requirements. In the case of Income Taxes: (x) Goldcorp USA or its ultimate U.S. parent corporation with which it files a consolidated return for federal income tax purposes shall include the income of Marigold (including any deferred items triggered into income by Treasury Regulation 1.1502-13 and any excess loss account taken into income under Treasury Regulation 1.1502-19) on its consolidated federal Income Tax Claim with respect Returns through the end of the Closing Date and pay any Income Taxes attributable to a Straddle Periodsuch income, Seller and (y) such income of Marigold shall be entitled apportioned to participate the period up to and including the Closing Date and the period after the Closing Date by closing the books of Marigold as of the end of the Closing Date. In the case of Nevada State Net Proceeds of Mineral Taxes, such net proceeds of Marigold (including without limitation, depreciation and amortization deductions) shall be apportioned to the period up to and including the Closing Date and the period after the Closing Date by closing the books of Marigold as of the end of the Closing Date. Marigold and Buyer shall furnish Tax information to Goldcorp USA for inclusion in such proceeding (at its sole cost consolidated federal Income Tax Return for the period that includes the Closing Date in accordance with Goldcorp USA’s past custom and expense) practice. Notwithstanding the foregoing, any penalty, interest or addition to Tax shall be allocated to the extent party that bears the liability for the Tax to which such penalty, interest or addition to Tax Claim relates, regardless of when such penalty, interest or addition to Tax is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementassessed.
Appears in 1 contract
Sources: Purchase and Sale Agreement (Silver Standard Resources Inc)
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before i) After the Closing Date, or otherwise relating to Taxes for which Buyer and Seller may be liable under this Agreement (shall each notify the other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser in writing within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects to control the defense commencement of any such audit or administrative or judicial proceeding affecting the Taxes or Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised attributes of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, thatthat Buyer shall only have the obligation to notify Seller if the audit or administrative or judicial proceeding would, if determined adversely to the taxpayer, or after the lapse of time, be grounds for indemnification under this Section 10.01 or under Article VIII with respect to Taxes by Seller. Such notice shall contain factual information describing any asserted Tax liability and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax liability. If either Buyer or Seller fails to give the other party prompt notice of an asserted Tax liability as required under this Agreement, the failure to give such notification shall not affect the indemnification provided hereunder except to the extent the other party shall have been actually prejudiced as a result of such failure or the indemnification obligations are increased as a result of such failure.
(ii) In the case of a an audit or administrative or judicial proceeding involving any Taxes or Tax Claim with respect attributes relating to a any taxable years or periods ending on or before the Closing Date or any Straddle PeriodPeriod of the Company or any of its Subsidiaries, Seller shall be entitled have the right, at its expense, to control the conduct of such audit or proceeding; provided, however, that Buyer may participate in the conduct of such audit or proceeding (at its sole cost own expense and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser Seller shall not settle any such portion of such Tax Claim audit or proceeding without the Seller’s consentconsent of Buyer, which consent may shall not be unreasonably withheld, conditioned or delayed.
(iii) In the case of an audit or administrative or judicial proceeding involving any Taxes or Tax attributes relating to any taxable years or periods beginning after the Closing Date of the Company or any of its Subsidiaries, Buyer shall have the right, at its expense, to control the conduct of such audit or proceeding; provided, however, that if such settlement audit or proceeding would affect be reasonably expected to result in a material increase in Tax liability of any of the amount of Taxes Company or any or its Subsidiaries for which Seller may would be liable under this AgreementSection 10.01(a) or under Article VIII, Seller may participate in the conduct of such audit or proceeding at its own expense and Buyer shall not settle any such audit or proceeding without the consent of Seller, which consent shall not be unreasonably withheld, conditioned or delayed; provided, further, that Seller’s right to participation and consent shall be limited to matters or issues involving the Company and its Subsidiaries.
Appears in 1 contract
Contests. Whenever (a) Buyer agrees to give prompt written notice to Seller Representative of the receipt of any Taxing Authority asserts a written notice by the Company, Buyer or any of Buyer’s Affiliates which involves the assertion of any claim, makes or the commencement of any Action, in respect of which an assessment, or otherwise disputes the amount of Taxes for which Seller indemnity may reasonably be expected sought by any Buyer Indemnitee pursuant to be liable under this Agreement Article VII (a “Tax Claim”); provided, Purchaser that failure to comply with this provision shall upon not affect a Buyer Indemnitee’s right to indemnification hereunder except to the extent the defense of the Claim is prejudiced thereby.
(b) Within fifteen (15) Business Days after receipt by Seller Representative of a notice of respecting a Tax Claim, the Seller Representative may elect, so long as Sellers have an obligation to indemnify Buyer Indemnitees hereunder with respect to such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten Buyer, to contest the Tax Claim in the name of the Company. If Seller Representative so elects, Sellers shall be solely responsible for the defense of the item or items at issue to the extent it relates to a Pre-Closing Tax Period, except that (10a) days the Seller Representative will keep Buyer informed with respect to the commencement, status and nature of receipt any such proceeding, and will reasonably cooperate with Buyer and consult with Buyer regarding the conduct of notice thereof; providedor positions taken in any such proceedings in the event the settlement would create a Tax liability on part of Buyer, howeverand (b) Sellers will not enter into any settlement or otherwise compromise any such proceeding without the prior written consent of Buyer (such consent not to be unreasonably withheld, conditioned or delayed) if such settlement would have the effect of materially increasing the Tax liability or materially reducing any Tax asset of the Company in respect of any Post-Closing Tax Period. Buyer will cause the Company to reasonably cooperate, in the contest of such Tax Claim by making relevant documents and employees available to Sellers and/or Seller Representative, and to execute such documents (including powers of attorney) as may be reasonably necessary to allow Sellers and/or Seller Representative to conduct the defense.
(c) With respect to any other Tax Claim, including a Tax Claim related to a Straddle Period and a Tax Claim that Purchaser maythe Seller does not elect to control, Buyer shall have sole responsibility for the defense of the item or items at its sole cost and expense, retain separate counsel of its choosing issue provided (a) Sellers will have the right (but not the duty) to participate in the defense or settlement of such Tax Claim proceeding and to employ counsel, at their own expense, separate from counsel employed by Seller. If Seller timely elects Buyer, (b) Buyer will keep Sellers informed with respect to control the defense commencement, status and nature of any such Tax Claim proceeding, and will reasonably cooperate with Sellers and consult with them regarding the conduct of or positions taken in accordance with this Section 5.06any such proceeding, and (ic) Seller shall keep Purchaser reasonably apprised Buyer will not enter into any settlement or otherwise compromise any such proceeding without the prior written consent of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser Seller Representative if Sellers would be obligated to pay or indemnify with respect thereto and (ii) Purchaser shall have the right to consenta Tax under this Agreement, which consent may will not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.
Appears in 1 contract
Contests. Whenever Upon receipt by Buyer or any Taxing Authority asserts a claim, makes an assessment, Affiliate of Buyer of any notice of any Audit with respect to Excluded Taxes or otherwise disputes the amount of any other Taxes for which Seller the Sellers may reasonably be expected to be liable under this Agreement hereunder (any such Audit, a “Tax Claim”"TAX MATTER"), Purchaser shall upon Buyer will notify the Sellers of any such Tax Matter within (x) three Business Days if, under applicable Law, the written response to such Tax Matter is required within 20 days after the receipt by Buyer of such notice of such Tax ClaimMatter, promptly inform Seller and (y) ten calendar days in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except to the extent that Seller is materially prejudiced therebyall other cases. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser The Sellers may, at its sole cost and their expense, retain separate counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects and, upon notice to control Buyer, assume the defense of any such Tax Claim Matter. Upon receipt of such notice from Sellers, Buyer will grant to Sellers a special and limited power of attorney in accordance with favor of Sellers, duly authenticated by a Mexican notary public, for lawsuits and collections to permit Sellers to properly defend or contest such Tax Matter. No delay in or failure by Buyer to give notice of such Tax Matter or to deliver such power of attorney pursuant to this Section 5.068.3(d) will alter or relieve the Sellers of their obligation to indemnify Buyer, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement except to the extent that the Sellers are prejudiced thereby or are prevented or in any way restricted from being able to assume the defense of such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing DateTax Matter. If Seller elects not the Sellers assume such defense, the Sellers will have the authority, with respect to control any Tax Matter, to represent the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall interests of the applicable Purchased Subsidiary before the relevant Taxing Authority and will have the right to control the defense defense, compromise or other resolution of any such Tax Claims at its sole cost Matter, including responding to inquiries and expensecontesting, defending against and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned resolving any assessment for additional Taxes or delayed, to any settlement thereof to the extent such settlement would affect the amount notice of Tax deficiency or other adjustment of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06of, Purchaser shall have the right to control any proceedings or relating to Taxes of or with respect to the Company or any of its Subsidiariesto, such Tax Matter; provided, however, thatthe Sellers will not enter into any settlement of or otherwise compromise any such Tax Matter to the extent that it could reasonably be expected to adversely affect the Tax liability of any Purchased Subsidiary for a period (or portion thereof) beginning after the Closing Date without the prior written consent of Buyer, which consent shall not be unreasonably withheld. Buyer has the right (but not the duty) to participate in the case defense of a such Tax Claim with respect Matter and to a Straddle Periodemploy counsel, Seller at its own expense, separate from the counsel employed by the Sellers. If Buyer elects to participate in the defense of any Tax Matter, then (i) Buyer shall be entitled to (A) without in any way limiting or affecting Sellers' right to assume the defense of such Tax Matter, participate fully in the conduct of such proceeding Tax Matter, including participating in all conferences and attending all meetings with the relevant authorities, and (B) consult with the Sellers, at its sole cost own expense, regarding any such Tax Matter, and expenseSellers shall consider in good faith any suggestions made by Buyer, (ii) the Sellers shall provide Buyer with a copy of all documents (or portions thereof) relating to such Tax Matter and (iii) the Sellers will not enter into any settlement of or otherwise compromise any such Tax Matter to the extent such that it could reasonably be expected to adversely affect the Tax Claim is related to liability of any Purchased Subsidiary for a period (or portion thereof) beginning after the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim Date without the Seller’s consentprior written consent of Buyer, which consent may shall not be unreasonably withheld, conditioned . The Sellers will allow Buyer to consult with Sellers regarding the conduct of or delayed, if positions taken in any such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementproceeding.
Appears in 1 contract
Contests. Whenever (a) After the Closing Date, Buyer shall promptly notify Seller in writing of any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of written notice of such Tax Claima proposed adjustment or claim in an audit or administrative or judicial proceeding involving Buyer or the Company which, promptly inform Seller in writingif determined adversely to the taxpayer, would be grounds for indemnification under Article 9; provided, however, that a failure to give such notice as provided herein shall will not relieve Seller of its obligations under this Article V affect Buyer’s right to indemnification thereunder except to the extent extent, if any, that, but for such failure, Seller could have avoided the Tax liability in question.
(b) In the case of an audit or administrative or judicial proceeding that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating relates solely to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), shall have the right at its sole cost and Seller’s expense by written notice to Purchaser within ten (10) days of receipt of notice thereof; provided, however, that Purchaser may, at its sole cost and expense, retain separate counsel of its choosing to participate in and control the defense or settlement conduct of such Tax Claim by Selleraudit or proceeding. Seller shall keep Buyer informed of the progress of any such audit or proceeding, and Buyer also may participate in any such audit or proceeding at its expense. Seller shall not settle any proceeding without the consent of Buyer, which consent shall not be unreasonably withheld, if the settlement would adversely affect the Company. If Seller timely elects to control does not assume the defense of any such Tax Claim audit or proceeding, Buyer may defend the same in accordance with this Section 5.06such manner as it may deem appropriate at its expense, including, but not limited to, settling such audit or proceeding.
(ic) Seller With respect to any other audit or proceeding not controlled by Seller, such audit or proceeding shall be controlled by Buyer; provided, that Buyer shall keep Purchaser reasonably Seller apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned such audit or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, proceeding and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any of participate at its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate own expense in such proceeding (at its sole cost audit or proceeding. Cooperation and expense) to the extent such Tax Claim is related to the portion Exchange of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this AgreementInformation.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claim, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser shall upon receipt of notice of such Tax Claim, promptly inform Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller of its obligations under this Article V except Notwithstanding anything to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before contrary contained in this Agreement:
(a) After the Closing Date, or otherwise relating to Taxes for which Purchaser shall notify Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser in writing within ten (10) days of receipt the date a claim is made or threatened in writing by any Taxing Authority that, if successful, may reasonably be expected to result in an indemnity payment by Seller under Section 10.4 (a "Tax Claim"). Such notice shall contain factual information describing in reasonable detail the nature and basis of such claim and the amount thereof, to the extent known, and shall include copies of any notice thereofor other document received from any Taxing Authority in respect of any such asserted Tax liability. Failure by Purchaser to give such notice to the Seller shall not relieve the Seller of any liability that it may have on account of its indemnification obligation under this Article X, except to the extent that the Seller is materially and adversely prejudiced thereby in the defense of such Tax Claim; provided, however, that Purchaser mayirrespective of whether the Seller is materially or adversely prejudiced, Seller may reduce any liability Seller may have on account of its indemnification obligation under this Article X by the amount of its actual, out-of-pocket monetary damages that are caused by the Purchaser's failure to timely give the notice required pursuant to this Section 10.7(a).
(b) Seller will have the right, at its sole cost option, upon timely notice to Purchaser, to assume at its own expense control of any audit or other defense of any Tax Claim (other than a Tax Claim relating solely to Taxes of the Company for a Straddle Period, which as described below, the parties shall jointly control) with its own counsel, provided that Seller's notice acknowledges Seller's indemnification liability for such claim. Seller's right to control a Tax Claim will be limited to issues in respect of which amounts in dispute would be paid by Seller or for which Seller would be liable pursuant to Section 10.4. Costs of defending or contesting such Tax Claims are to be borne by Seller unless the Tax Claim relates to a Straddle Period, in which event such costs shall be fairly apportioned as described below. Purchaser and expensethe Company at their own expense each shall cooperate with Seller in contesting any Tax Claim, retain separate counsel which cooperation shall include the retention and, upon Seller's request, the provision of its choosing records and information that are reasonably relevant to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects and making employees available on a mutually convenient basis to control the defense provide additional information or explanation of any such material provided hereunder. Notwithstanding the foregoing, Seller shall neither consent nor agree to the settlement of any Tax Claim in accordance with this Section 5.06respect to any liability for Taxes that may affect the liability for any state, (i) Seller shall keep Purchaser reasonably apprised federal or foreign income tax of the status Company or any affiliated group (as defined in section 1504(a) of the Code) of which the Company is a member for any Post-Closing Tax Claim and Period without the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consentprior written consent of Purchaser, which consent may shall not be unreasonably withheld, conditioned or delayed, to and neither Seller, nor any settlement to Affiliate of Seller, shall file an amended Tax Return that may increase the extent such settlement would affect liability for Taxes of the amount Company for any Post-Closing Tax Period without the prior written consent of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing Date. If Seller elects not to control the defense or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consentPurchaser, which consent may shall not be unreasonably withheld, conditioned or delayed, to . Purchaser and Seller shall jointly control all proceedings taken in connection with any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings Tax Claims relating to Taxes of or with respect to the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect solely to a Straddle Period, Seller Period of the Company and each party shall bear its own out-of-pocket costs and expenses of the contest and all joint costs and expenses of the contest shall be entitled to participate borne in such proceeding (at its sole cost and expense) to the extent such same ratio as the applicable proposed Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not would be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreementallocated.
Appears in 1 contract
Contests. Whenever any Taxing Authority asserts a claimFor purposes of this Agreement, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Contest” is any audit, court proceeding or other dispute with respect to any Tax Claim”)matter that affects the Company or any of its Subsidiaries or the Additional Assets or the Excluded Assets, Purchaser shall upon receipt as the case may be. Unless Parent has previously received written notice from Seller of notice the existence of such Tax ClaimContest, promptly inform Seller in writing; provided, however, that failure Parent shall give written notice to give such notice as provided herein shall not relieve Seller of its obligations the existence of any Contest relating to a Tax matter that may result in Seller being required to make a Tax Indemnity Payment under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense of any Tax Claim relating to taxable periods ending on or before the Closing Date, or otherwise relating to Taxes for which Seller may be liable under this Agreement (other than with respect to a Straddle Period), at its sole cost and expense by written notice to Purchaser VIII within ten (10) days from the receipt by Parent of any written notice of such Contest but Parent’s failure to provide Seller with such notice within such time shall not relieve Seller of any liability hereunder except to the extent Seller is prejudiced thereby. Unless Seller previously has received written notice from Parent of the existence of such Contest, Seller shall give written notice to Parent of the existence of any Contest relating to a Tax matter that may result in Parent being required to make a Tax Indemnity Payment under this Article VIII within ten (10) days from the receipt by Seller of any written notice thereof; of such Contest but Seller’s failure to provide Parent with such notice within such time frame shall not relieve Parent of any liability hereunder except to the extent Parent is prejudiced thereby. Parent and Seller agree, in each case at no cost to the other party, to cooperate with the other and the other’s representatives in a prompt and timely manner in connection with any Contest. Such cooperation shall include making available to the other party, during normal business hours, all books, records, returns, documents, files, other information (including working papers and schedules), officers or employees (without substantial interruption of employment) or other relevant information necessary or useful in connection with any Contest requiring any such books, records and files, provided, however, that Purchaser maySeller shall not be obligated to provide information relating to Taxes of Seller’s consolidated or combined tax group except to the extent such information relates solely to the Company or its Subsidiaries and neither Seller nor Parent shall be obligated to make any disclosure that reasonably could, as a result of such disclosure, have the effect of causing the waiver of any legal privilege. Seller shall, at its sole cost and expenseelection, retain separate have the right to represent the Company’s or any of its Subsidiaries’, as the case may be, interests in any Contest relating to a Tax matter for which it may be required to make a Tax Indemnity Payment, to employ counsel of its choosing to participate in the defense or settlement of such Tax Claim by Seller. If Seller timely elects choice at its expense, and to control the defense conduct of any such Tax Claim in accordance with this Section 5.06Contest, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser including settlement or other disposition thereof, provided, however, that Parent shall have the right to consent, which consent consult with Seller regarding any such Contest that may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser Company or its Affiliates may be liable Subsidiaries for taxable any periods ending after the Closing Date. If Seller elects not to control the defense Date at Parent’s own expense and provided, further, that any settlement or thereafter fails or ceases to defend other disposition of any such Tax ClaimContest may only be with the consent of Parent, which consent will not be unreasonably withheld. Purchaser shall have the right to control the defense conduct of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or Contest with respect to any Tax matter arising in a period after the Company or any of its Subsidiaries; provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent may not be unreasonably withheld, conditioned or delayed, if such settlement would affect the amount of Taxes Date for which the Seller may be liable under does not have liability pursuant to this AgreementArticle VIII.
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Contests. Whenever any Taxing Authority asserts a claim(a) After the Closing, makes an assessment, or otherwise disputes the amount of Taxes for which Seller may reasonably be expected to be liable under this Agreement (a “Tax Claim”), Purchaser Buyer shall upon receipt of notice of such Tax Claim, promptly inform notify Seller in writing; provided, however, that failure to give such notice as provided herein shall not relieve Seller writing of its obligations under this Article V except to the extent that Seller is materially prejudiced thereby. Seller shall have the right to elect to control the defense commencement of any Tax Claim relating on Buyer or its Affiliates (including the members of the Company Group after the Closing) which, if determined adversely to taxable periods ending on the taxpayer or before after the Closing Datelapse of time could be grounds for indemnification by Seller under Section 6.2. Such notice shall contain factual information (to the extent known to Buyer) describing the asserted Tax Liability in reasonable detail and shall include copies of any notice or other document received from any Tax Authority in respect of any such asserted Tax Liability. If Buyer fails to give Seller prompt notice of an asserted Tax Liability as required by this Section 7.5, or otherwise relating then (i) if Seller is precluded by the failure to Taxes give prompt notice from contesting the asserted Tax Liability in both the administrative and judicial forums, then Seller shall not have any obligation to indemnify for any loss arising out of such asserted Tax Liability, and (ii) if Seller is not so precluded from contesting but such failure to give prompt notice results in actual prejudice to Seller, then any amount which Seller may be liable under this Agreement (other than is otherwise required to pay Buyer pursuant to Section 6.2 with respect to a Straddle Period)such Liability shall be reduced by the amount of such actual prejudice.
(b) Seller may elect to direct, through counsel of its own choosing and at its sole cost and expense by written notice own expense, any Claim involving any asserted Tax Liability with respect to Purchaser which indemnity may be sought from Seller under Section 6.2 (any such audit, claim for refund or proceeding relating to an asserted Tax Liability are referred to herein collectively as a “Contest”). If Seller elects to direct the Contest of an asserted Tax Liability, it shall within ten (10) 30 calendar days of receipt of the notice thereof; providedof asserted Tax Liability notify Buyer of Seller’s intent to do so, howeverand Buyer shall, that Purchaser may, at its sole cost and expense, retain separate counsel shall cause each of its choosing to participate Affiliates (including the members of the Company Group after the Closing) to, cooperate in the defense or settlement each phase of such Tax Claim by Seller. If Seller timely elects to control the defense of any such Tax Claim in accordance with this Section 5.06, (i) Seller shall keep Purchaser reasonably apprised of the status of the Tax Claim and the defense thereof and shall reasonably consider recommendations made by Purchaser with respect thereto and (ii) Purchaser shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement to the extent such settlement would affect the amount of Taxes for which Purchaser or its Affiliates may be liable for taxable periods ending after the Closing DateContest. If Seller elects not to control direct the defense Contest or thereafter fails or ceases to defend any such Tax Claim, Purchaser shall have the right to control the defense of such Tax Claims at its sole cost and expense, and Seller shall have the right to consent, which consent may not be unreasonably withheld, conditioned or delayed, to any settlement thereof to the extent such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement. Except as otherwise required by the foregoing provisions of this Section 5.06, Purchaser shall have the right to control any proceedings relating to Taxes of or with respect to the Company or any notify Buyer of its Subsidiaries; election as herein provided, however, that, in the case of a Tax Claim with respect to a Straddle Period, Seller shall be entitled to participate in such proceeding (at its sole cost and expense) to the extent such Tax Claim is related to the portion of such Straddle Period that is a Pre-Closing Tax Period, and Purchaser shall not settle such portion of such Tax Claim without the Seller’s consent, which consent Buyer may not be unreasonably withheld, conditioned pay or delayed, if such settlement would affect the amount of Taxes for which Seller may be liable under this Agreement.compromise such
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