Tax Contests Clause Samples
A Tax Contests clause outlines the procedures and rights of parties when there is a dispute or challenge regarding tax assessments, liabilities, or claims related to a transaction or agreement. Typically, this clause specifies which party has the authority to control the defense or contest of a tax matter, the obligations to notify the other party of any tax proceedings, and how costs or settlements are handled. For example, if a tax authority audits a transaction and proposes an adjustment, the clause will determine who manages the response and who bears the financial consequences. The core function of this clause is to allocate responsibility and control over tax disputes, thereby reducing uncertainty and potential conflict between the parties.
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Tax Contests. (a) If any party receives written notice from any Governmental Authority of a Tax Proceeding with respect to any Tax for which the other party is obligated to provide indemnification under this Agreement, such party shall within sixty (60) days thereof give written notice to the other party (or within such shorter time as may be necessary to give the Indemnifying Party a reasonable opportunity to respond to such notice); provided, however, that the failure to give such notice shall not affect the indemnification provided hereunder except to the extent that the failure to give such notice materially prejudices the Indemnifying Party as provided in Section 11.6.
(b) Upon written notice to Clarant within thirty (30) days after receipt of notification pursuant to Section 11.4(a), the Stockholders shall have the right, at their own expense, to control and make all decisions with respect to any Tax Proceeding relating to Taxes of the Company or any Subsidiary for any Taxable Period ending on or before the Closing Date. Clarant shall have the right to approve the counsel selected by the Stockholders to conduct any such Tax Proceeding, which approval shall not be unreasonably withheld, and to participate fully at its own expense with counsel of its own choosing in all aspects of the prosecution or defense of such Tax Proceeding. The Stockholders shall not take any action or position in any such Tax Proceeding if that action or position could reasonably be expected to increase the past, present or future Tax liability of Clarant or any of its Affiliates, or any Tax liability of the Company or any Subsidiary for any Taxable Period or portion thereof beginning after the Closing Date without the prior written consent of Clarant, which consent shall not be unreasonably withheld. The Stockholders shall not settle or otherwise terminate any such Tax Proceeding without the prior written consent of Clarant, which consent shall not be unreasonably withheld.
(c) Upon written notice to Clarant within thirty (30) days after receipt of notification pursuant to Section 11.4(a), the Stockholders shall have the right, at their own expense, to jointly control and participate with Clarant in the conduct of any Tax Proceeding relating to Taxes of the Company or any Subsidiary for a Straddle Period. If Sellers exercise such right, neither party shall settle or otherwise terminate any such Tax Proceeding without the prior written consent of the other, which consent shall not be unreaso...
Tax Contests. 9.4.1 If any Taxing Authority asserts any Tax Claim, then the party hereto first receiving notice of such Tax Claim promptly shall provide written notice thereof to the other party. Such notice shall specify in reasonable detail the basis for such Tax Claim and shall include a copy of any relevant correspondence received from the Taxing Authority. However, failure to give such notice shall not affect the indemnification obligations under Section 9.1.1(c), except to the extent the Indemnifying Party shall have (i) been prejudiced as a result of such failure or (ii) forfeited rights and defenses otherwise available to the Indemnifying Party as a result of such failure.
9.4.2 Seller shall have the sole right to defend or prosecute, at its sole cost, expense and risk, any Tax Claim attributable to a Pre-Closing Period (except for any Tax Claim attributable to a Straddle Period); provided that in the case of a Tax Claim relating to Apache it (i) acknowledges its responsibility to provide indemnification with respect to such claim and (ii) notifies Purchaser in writing within thirty (30) days of being notified of such Tax Claim that it intends to defend such claim. Purchaser and its authorized representatives shall be entitled, at Purchaser’s expense, to attend, but not participate in or control, all conferences, meetings and proceedings relating to any such Tax Claim attributable to a Pre-Closing Period. In the case of any such Tax Claim relating to Apache, Seller shall not settle or compromise such Tax Claim without Purchaser’s consent (which shall not be unreasonably withheld, delayed or conditioned) if such settlement or compromise would have an adverse effect on Purchaser or Apache in any Post-Closing Period. Purchaser shall have the sole right to defend or prosecute, any Tax Claim attributable to a Straddle Period. With respect to a Tax Claim attributable to a Straddle Period, Purchaser shall not settle or compromise such Tax Claim without Seller’s prior written consent (which consent shall not be unreasonably withheld, delayed or conditioned). Seller and its authorized representatives shall be entitled, at Seller’s expense, to attend, but not participate in or control, all conferences, meetings and proceedings relating to any Tax Claim attributable to a Straddle Period. Any party that does not have the right to defend or prosecute a particular Tax Claim shall take or cause to be taken such actions in connection with contesting such Tax Claim as the party ...
Tax Contests. Buyer shall notify Seller within fifteen (15) days of receipt by Buyer or any of its Affiliates (including, after the Closing, the Company) of notice of any pending or threatened assessment or claim in any audit, litigation or other proceeding relating to any Excluded Tax (a “Tax Contest”), provided, however, that failure of the Buyer to timely give the notice provided in this Section 5.3 to Seller shall not affect Seller’s obligations hereunder unless Seller can demonstrate that it was actually prejudiced by such failure and, in which case, Seller’s obligations hereunder shall be reduced to the extent (and only to the extent) of such prejudice. Buyer shall have the right to control any such Tax Contest, including the settlement or other disposition thereof; provided, that (a) Seller shall have the right to participate, at its own expense, in any such Tax Contest, (b) Buyer shall consider in good faith any reasonable comments of Seller with respect to the conduct of such Tax Contest, (c) Buyer shall keep Seller reasonably informed of the status of such Tax Contest (including by providing Seller with copies of all material written correspondence with a taxing authority regarding such matter), and (d) Buyer shall not settle or compromise any such Tax Contest that may give rise to an indemnification claim pursuant to ARTICLE IX, without the prior consent of Seller, which consent shall not be unreasonably withheld, conditioned or delayed. Notwithstanding anything to the contrary in this Agreement, Seller shall have the exclusive right to control in all respects, and neither Buyer nor any of its Affiliates (including, after the Closing, the Company) shall be entitled to participate in, any Tax Contest that solely relates to any Tax Return of a consolidated, combined or unitary group that includes Seller or any of its Affiliates and where Seller is responsible for any related Tax that may arise from such Tax Contest. In the event of any conflict or overlap between the provisions of this Section 5.3 and any other provisions in this Agreement, the provisions of this Section 5.3 will control. For the avoidance of doubt, any claim for indemnification in respect of such Tax Contest will be governed by ARTICLE IX.
Tax Contests. (a) Whenever any Taxing Authority initiates an audit of, asserts a claim for, proposes to assess or adjust, or otherwise disputes the amount of, any Tax of Seller with respect to the Acquired Assets or the Business for a Tax period ending on or before the Closing Date, including the pre-Closing portion of any Straddle Period, for which Seller is reasonably likely to incur an indemnification obligation under this Agreement (each, a “Tax Contest”), Purchaser shall notify Seller in writing of such audit or claim; provided that any failure to provide such notification shall not affect any obligation of Seller to indemnify Purchaser pursuant to Article X except to the extent that Seller’s ability to contest such Tax is actually and materially prejudiced by such failure.
(b) Seller shall have the right to handle, defend, conduct and control any Tax Contest; provided that, (A) Purchaser, at its sole cost and expense, shall have the right to participate in the Tax Contest; (B) Seller shall consider in good faith any suggestions made by Purchaser about the conduct of such audit or contest; (C) Seller shall provide copies to Purchaser of all material correspondence and other written communications between Seller and any Taxing Authority relating to the Tax Contest and, in the event a settlement or compromise could materially or adversely impact a post-Closing Tax period or the Acquired Assets, and provide Purchaser with a reasonable opportunity to comment thereon, and (D) Seller shall not settle or compromise any Tax Contest without the prior written consent of Purchaser, such consent not to be unreasonably withheld, delayed or conditioned.
(c) To the extent there is any inconsistency between this Section 12.2 and Section 10.3 as to any Tax Contest, this Section 12.2 shall control.
Tax Contests. (a) An Indemnified Party shall promptly notify the Indemnifying Party of the commencement of any Tax Contest that could reasonably be expected to (i) obligate the Indemnifying Party to make an Indemnity Payment or (ii) cause the Indemnifying Party or any of its Subsidiaries to incur any Taxes for which it is not indemnified under this Agreement. A failure by an Indemnified Party to give notice under this Section 4.05(a) shall not relieve the Indemnifying Party’s indemnification obligations under this Agreement, except to the extent that the Indemnifying Party shall have been actually prejudiced by such failure.
(b) Except as provided in Section 4.05(c), Sporting shall have the exclusive right to control the conduct and settlement of any Tax Contest relating to any Sporting Separate Tax Return not set forth on Schedule 4.01(a), and ATK shall have the exclusive right to control the conduct and settlement of all other Tax Contests. Notwithstanding the foregoing, if the conduct or settlement of any portion or aspect of any such Tax Contest could reasonably be expected to obligate any Party to make an Indemnity Payment, then (i) the Indemnifying Party shall have the right to share joint control over the conduct and settlement of that portion or aspect and (ii) whether or not the Indemnifying Party exercises that right, the Indemnified Party shall not accept or enter into any settlement that would obligate the Indemnifying Party to make an Indemnity Payment without the consent of the Indemnifying Party, which consent shall not be unreasonably withheld or delayed.
(c) ATK and Sporting shall have the right to control jointly the conduct and settlement of any Tax Contest insofar as it relates to Transaction Taxes. Notwithstanding the foregoing, ATK shall be entitled to control exclusively the conduct and settlement of any Tax Contest insofar as it relates to Transaction Taxes if ATK notifies Sporting that (notwithstanding the rights and obligations of the Parties set forth elsewhere in this Agreement) ATK agrees to (i) waive its rights to indemnification for Transaction Taxes under Article III and (ii) pay, and indemnify all of the members of the Sporting Separate Group from and against, any Transaction Taxes resulting from such Tax Contest insofar as it relates to Transaction Taxes.
(d) Each Party shall bear its own expenses in the course of any Tax Contest, other than expenses included in the definition of Transaction Taxes, which shall be governed by Article III...
Tax Contests. (i) In the event that Buyer or the Company becomes aware, the Buyer shall notify the Seller Representative in writing within ten (10) days of receipt of the proposed assessment or the commencement of any audit or administrative or judicial proceeding or of any demand or claim on the Buyer, its Affiliates or the Company with respect to Taxes and Tax Returns of the Company which, if determined adversely to the Buyer, its Affiliates, the Company or any Indemnifying Parties or after the lapse of time, could be grounds for indemnification by the Indemnifying Parties under Section 6.9(a). Such notice shall contain factual information (to the extent known to the Buyer, 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 the Buyer fails to give the Seller Representative notice of an asserted Tax liability as required by this Section 6.9(e), then the Indemnifying Parties 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 Representative demonstrates that the defense of such Tax liability is actually and materially prejudiced thereby.
(ii) In the case of a Tax audit or administrative or judicial proceeding that relates to a Pre-Closing Tax Period (excluding any Straddle Periods which shall be governed by Section 6.9(e)(iii)) and which could give rise to indemnification by the Sellers under Section 6.9(a) (a “Pre-Closing Tax Contest”), the Seller Representative shall have the right, at the Indemnifying Parties’ expense, to direct and control, through counsel of its own choosing the conduct of such Pre-Closing Tax Contest. The Seller Representative shall promptly notify the Buyer of the Indemnifying Parties’ intent to do so. Neither the Indemnifying Parties nor any of their respective Affiliates shall enter into any settlement of or otherwise compromise any Pre-Closing Tax Contest that adversely affects or may adversely affect the Tax liability of the Buyer, the Company or any of their Affiliates for any period ending after the Closing Date without the prior written consent of the Buyer, which consent shall not be unreasonably withheld or delayed. If the Seller Representative elects not to direct the Pre-Closing Tax Contest, the Buyer or the Company may assume control of such Pre-Closing Tax Contest.
(iii)...
Tax Contests. (i) Seller Representative shall have the right, at Sellers’ sole expense, to control and represent the interest of the Acquired Entities in any audit or examination by any Taxing Authority and contest, resolve and defend against any assessment for additional Taxes, notice of Tax deficiency or other adjustment of Taxes of or relating to any Tax liability of the Acquired Entities for any Pre-Closing Period (a “Tax Claim” ) to the extent such Tax Claim is subject to indemnification by the Sellers pursuant to Section 7.2; provided that (A) Seller Representative shall keep Buyer reasonably informed and consult in good faith with Buyer and its tax advisors with respect to any issue relating to such Tax Claim; (B) Seller Representative shall provide Buyer with copies of all correspondence, notices and other written materials received from any Taxing Authorities and shall otherwise keep the Buyer and its tax advisors advised of significant developments in the audit or dispute and of significant communications involving representatives of the Taxing Authorities, including copies of any written material submission to be sent to a Taxing Authority prior to the submission thereof; (C) Buyer may request that Seller Representative take a position in respect of such audit or proceeding, and Seller Representative shall not unreasonably refuse to do so provided that (I) there exists substantial authority for such position (within the meaning of the accuracy-related penalty provisions of Section 6662 of the Code) and (II) the adoption of such position could not reasonably be expected to adversely affect the Tax liability of any of Acquired Entities or Sellers for any Pre-Closing Tax Period or portion thereof (unless the Buyer agrees to indemnify and hold harmless the Sellers from such adverse effect); and (D) Seller shall not enter into any settlement, resolution, closing or other agreement with respect to a Tax Claim that could reasonably be expected to adversely affect the Tax liability of Buyer without the consent of Buyer, which consent will not be unreasonably withheld.
(ii) Except as provided in Section 4.12(b)(i), Buyer shall have the exclusive authority to control any 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 relating to any Tax liability of the Acquired Entities; provided, t...
Tax Contests. (i) Buyer or Seller, as the case may be, shall notify the other Party within 20 Business Days after receipt by such Party or any of its Affiliates of written notice of any pending federal, state, local or foreign Tax audit or examination or notice of deficiency or other adjustment, assessment or redetermination relating to Taxes for which such other Party or its Affiliates may be responsible under this Agreement (“Tax Matters”).
(ii) Seller and its Affiliates shall have the right to control, contest, resolve and defend against any Tax Matters relating in whole or in part to (A) Taxes of any Acquired Company or Related Consolidated Entity for which Seller is responsible under this Agreement or (B) Taxes of any member of the Seller Group; provided that, in the case of a Tax Matter described in (A) and not in (B) of this sentence which Tax Matter could be reasonably expected to materially and adversely affect Buyer’s or its Affiliates’ (including after the Closing, the Acquired Companies and Related Consolidated Entities) liability for Taxes (other than any such liability resulting from the reduction or elimination of a net operating loss, capital loss or tax credit of the Acquired Companies or the Related Consolidated Entities arising in a Pre-Closing Tax Period), Seller shall keep Buyer reasonably informed regarding the progress of such Tax Matter and Seller shall not, and shall not permit its Affiliates to, concede, settle or compromise a Tax Matter (or portion thereof) controlled by Seller under this Section 5.11(f)(ii) without the prior consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed).
(iii) Buyer shall have the right to control all Tax Matters of any Acquired Company or Related Consolidated Entity not controlled by Seller pursuant to Section 5.11(f)(ii); provided that, in the case of a Tax Matter that may give rise to a claim for indemnification under this Agreement, Buyer shall keep Seller reasonably informed regarding the progress of such Tax Matter and shall not, and shall not permit its Affiliates to, concede, settle or compromise such Tax Matter (or portion thereof) controlled by Buyer under this Section 5.11(f)(iii) without the prior consent of Seller (which consent shall not be unreasonably withheld, conditioned or delayed).
(iv) In the event of any conflict between Article VII and this Section 5.11(f), this Section 5.11(f) shall control.
Tax Contests. If any Governmental Authority issues to W▇▇▇▇ Canada a Tax Claim with respect to W▇▇▇▇ Canada for any Tax period ending on or prior to the Closing Date, the Canadian Purchaser shall notify Katy of its receipt of such communication from the Governmental Authority within thirty (30) Business Days after receiving such notice of Tax Claim. No failure or delay of Canadian Purchaser or W▇▇▇▇ Canada in the performance of the foregoing shall reduce or otherwise affect the obligations or liabilities of Katy pursuant to this Agreement, except to the extent that such failure or delay shall preclude Katy from defending against any liability or claim for Taxes that Katy is obligated to pay hereunder. Katy shall control any examination, investigation, audit, or other proceeding ("Tax Contest") in respect of any such Tax Claim; provided, however:
(a) Katy first acknowledges in writing that: (i) to the extent the Tax Claim includes an assertion that an amount is or may be owing with respect to Taxes, that Katy is obligated to indemnify the Canadian Purchaser for such Taxes; and (ii) to the extent the Tax Claim does not include an assertion that an amount is or may be owing with respect to Taxes, Katy is liable to indemnify the Canadian Purchaser for Taxes for the Tax periods subject to the Tax Claim;
(b) Katy shall not have control of any Tax Contest to the extent that such Tax Contest relates to or affects a Tax period ending after the Closing Date;
(c) Katy shall not have control of the portion of an Tax Contest that affects Tax periods on or before the Closing Date where such Tax Contest also affects or may affect Tax periods ending following the Closing Date and the Canadian Purchaser determines, acting reasonably, that it is impractical for Katy to control a portion of such Tax Contest or that such control by Katy will or may adversely affect the Canadian Purchaser’s ability to effectively control, settle or resolve the portion of the Tax Contest affecting Tax periods ending after the Closing Date; and
(d) Katy shall not (and shall not allow W▇▇▇▇ Canada), to settle a Tax Claim or Tax Contest without the prior written consent of the Canadian Purchaser if such compromise and settlement may have an impact upon Taxes of W▇▇▇▇ Canada for any period ending after the Closing Date or would result in a Tax liability to W▇▇▇▇ Canada or its Affiliates or an adverse effect of their tax attributes for which Katy has not undertaken to indemnify the Canadian Purchaser. Katy shall ...
Tax Contests. (a) MetLife or Brighthouse, as applicable, shall, within 10 business days of becoming aware of any Tax Contest (including a Transaction Tax Contest) that could reasonably be expected to cause the other Party to have an indemnification obligation under this Agreement, notify the other Party of such Tax Contest and thereafter promptly forward or make available to the Indemnifying Party copies of notices and communications relating to the relevant portions of such Tax Contest. A failure by an Indemnitee to give notice as provided in this Section 3.03(a) (or to promptly forward any such notices or communications) shall not relieve the Indemnifying Party’s indemnification obligations under this Agreement, except to the extent that the Indemnifying Party shall have been actually prejudiced by such failure; provided, however, that such Indemnitee shall make all commercially reasonable efforts to mitigate such failure, including by seeking an extension of any relevant time limitations or deadlines for response.
(b) Subject to the next two sentences, MetLife and Brighthouse each shall have the exclusive right to control the conduct and settlement of any Tax Contest, other than a Transaction Tax Contest, relating to any Tax Return that it is responsible for preparing pursuant to Section 3.01. With respect to a Tax Contest relating to a Joint Return described in clauses (1) or (2) of Section 3.01(c), (i) MetLife shall solely control the resolution of such Tax Contest, (ii) Brighthouse shall be permitted to participate in all formally scheduled meetings with any Tax Authority relating to such contest, (iii) MetLife shall allow Brighthouse a reasonable opportunity to comment on any material proposed course of action and shall take account of Brighthouse’s reasonable comments in relation thereto, (iv) MetLife shall conduct such Tax Contest with reasonable diligence and in good faith, (v) MetLife shall keep Brighthouse promptly informed of all material developments in relation to the Tax Contest, and (vi) if the outcome of a Tax Contest is material to Brighthouse but not material to MetLife, MetLife must either (A) obtain the consent of Brighthouse to settle such Tax Contest, which consent shall not be unreasonably withheld or (B) waive any and all rights to indemnification or payment from Brighthouse pursuant to Article II for matters arising from such Tax Contest. In determining the materiality of the outcome of a Tax Contest under this clause (vi), Brighthouse’s harm ...