Common use of Tax Effect Clause in Contracts

Tax Effect. (a) If any Indemnity Payment received or accrued by an Indemnified Party would constitute income for tax purposes to such Indemnified Party, the Indemnifying Party will pay a Tax Gross-Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.12. (c) The amount of any Loss for which indemnification is provided will be adjusted to take into account any Tax Benefit realized by the Indemnified Party or any of its Affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine the applicability, if any, of this subsection 9.12(c) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties (the "Independent Accountant"). If the applicable Parties are unable to agree on the Independent Accountant within 10 days of the end of such 60 day period, any Party may apply under the Arbitration Act (Ontario) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution of the dispute shall be paid by the applicable Parties in such proportions as are determined by the Independent Accountant. The Independent Accountant will be deemed to be acting as an expert and not an arbitrator (unless appointed by a court under the Arbitration Act (Ontario) in which case the Independent Accountant will be deemed to be acting as an arbitrator).

Tax Effect. (a) If any Indemnity Payment received or accrued by an Indemnified Party would constitute income for tax purposes to such Indemnified Party, the Indemnifying Party will pay a Tax Gross-Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.128.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's ’s income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 8.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.128.12. (c) The amount of any Loss for which indemnification is provided will be adjusted to take into account any Tax Benefit realized by the Indemnified Party or any of its Affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine the applicability, if any, of this subsection 9.12(cSection 8.12(c) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties (the "“Independent Accountant"”). If the applicable Parties are unable to agree on the Independent Accountant within 10 days of the end of such 60 day period, any Party may apply under the Arbitration Act (OntarioAlberta) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(cSection 8.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(cSection 8.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution of the dispute shall be paid by the applicable Parties in such proportions as are determined by the Independent Accountant. The Independent Accountant will be deemed to be acting as an expert and not an arbitrator (unless appointed by a court under the Arbitration Act (OntarioAlberta) in which case the Independent Accountant will be deemed to be acting as an arbitrator).

Tax Effect. If the amount of any payment required to be made by the Indemnifying Party to Methanex (aan “Indemnity Payment”) If any Indemnity Payment received or accrued by would result in an Indemnified Party would constitute increase in the income for tax purposes of Methanex (net of any deduction available to Methanex in respect of the Loss being indemnified), the Indemnifying Parties shall pay a Tax Gross Up (as defined below) to Methanex at the same time as the Indemnity Payment is paid. For purposes of this Section 2.7 “Tax Gross Up” shall mean, with respect to any Indemnity Payment, such additional amount (calculated in accordance with the Calculation Method, as defined below) as is necessary to place Methanex in the same after tax position as it would have been in had such Indemnity Payment (net of the treatment of the Loss) been received tax free, and the transactions contemplated by this Agreement, including any Indemnity Payments, had no impact upon the tax position of Methanex; and “Calculation Method”, with respect to the calculation of any Tax Gross Up on any Indemnity Payments, shall mean that such Tax Gross Up shall be calculated by using the combined federal and provincial income tax rate applicable to Methanex and without regard to any losses, credits, refunds or deductions that Methanex may have or had which affected or could affect the amount of any Taxes so required to be paid by Methanex and payable on any such Indemnity Payment. If the Tax Gross-Up is required to be made to the Indemnified Parties in respect of a taxation year and such Indemnified PartyParties will not be required to make a cash payment on account of Taxes under Part I of the Tax Act and the equivalent provisions of applicable provincial legislation in respect of such year, as a result of the availability of tax losses, credits, or other deductions to the Indemnified Parties for such year, the Indemnifying Party will pay a shall be entitled to defer paying the Tax Gross-Up to the Indemnified Party at the same time Parties and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.12section 2.6 shall apply, mutatis mutandis. (c) The amount of any Loss for which indemnification is provided will be adjusted to take into account any Tax Benefit realized by the Indemnified Party or any of its Affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine the applicability, if any, of this subsection 9.12(c) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties (the "Independent Accountant"). If the applicable Parties are unable to agree on the Independent Accountant within 10 days of the end of such 60 day period, any Party may apply under the Arbitration Act (Ontario) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution of the dispute shall be paid by the applicable Parties in such proportions as are determined by the Independent Accountant. The Independent Accountant will be deemed to be acting as an expert and not an arbitrator (unless appointed by a court under the Arbitration Act (Ontario) in which case the Independent Accountant will be deemed to be acting as an arbitrator).

Tax Effect. (a) If any Indemnity Payment payment received or accrued by an Indemnified Party hereunder (an "Indemnity Payment") would constitute income for tax purposes to such Indemnified Party, the Indemnifying Party will shall pay a Tax Gross-Gross Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.12. (c) The amount of any Loss for which indemnification is provided will shall be adjusted to take into account any Tax Benefit tax benefit realized by the Indemnified Party or any of its Affiliates affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each For purposes of this paragraph (f), any tax benefit shall be taken into account at such time as it is received by the Indemnified Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine or its affiliate. Notwithstanding the applicabilityforegoing provisions of this paragraph (f), if any, of this subsection 9.12(can Indemnity Payment is included in the Indemnified Party's income pursuant to paragraph 12(1)(x) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties Canadian Income Tax Act (or an equivalent provision of any relevant provincial legislation), the "Independent Accountant"). If the applicable Parties are unable Indemnified Party covenants and agrees to agree on the Independent Accountant within 10 days make an election pursuant to subsection 12(2.2) of the end of such 60 day period, any Party may apply under the Arbitration Canadian Income Tax Act (Ontarioand the equivalent provision of any applicable provincial legislation) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution Indemnity Payment to the maximum extent possible such that the amount of the dispute Indemnity Payment included in the Indemnified Party's income for tax purposes is minimized or eliminated. For purposes of this paragraph (f), "Tax Gross Up" shall mean, with respect to any Indemnity Payment, such additional amount (calculated in accordance with the Calculation Method) as is necessary to place the Indemnified Party in the same after tax position as it would have been in had such Indemnity Payment been received tax free; and "Calculation Method" with respect to the calculation of any Tax Gross Up on any Indemnity Payments, shall mean that such Tax Gross Up shall be paid calculated by using the combined federal and provincial income tax rate applicable to the Indemnified Party and, except as provided in this paragraph (f), without regard to any losses, credits, refunds or deductions that the Indemnified Party may have which could affect the amount of tax payable on any such Indemnity Payment. SCHEDULE C ALTERNATIVE TRANSACTIONS Plan of Arrangement The parties acknowledge and agree that it is the intention of the parties that the acquisition of Common Shares by the Offeror (the "Acquisition") be effected in a manner that permits both Canadian and United States Shareholders to dispose of their Common Shares on a tax-deferred rollover basis (a "Tax Deferred Basis"). In order to achieve the foregoing objective, it is proposed that the Acquisition be effected pursuant to a Plan of Arrangement (the "Plan of Arrangement") under section 192 of the Canada Business Corporations Act ("CBCA") in a manner to permit Shareholders to obtain a rollover for Canadian income tax purposes under section 85.1, or, where the Shareholder elects, under section 85, of the Canadian Income Tax Act and any applicable Parties in such proportions as are determined by provincial tax legislation (collectively, "Canadian Income Tax Legislation") and to permit Shareholders to obtain a tax-free rollover for United States tax purposes pursuant to section 368(a)(1)(B) of the Independent AccountantUnited States Internal Revenue Code (a "B Reorganization"). The Independent Accountant will be deemed parties agree to be acting as an expert and not an arbitrator (unless appointed by cooperate to consummate the Plan of Arrangement pursuant to a court under the Arbitration Act (Ontario) in which case the Independent Accountant will be deemed to be acting as an arbitrator)B Reorganization for United States tax purposes.

Tax Effect. (a) If any Indemnity Payment received or accrued by an Indemnified Party would constitute is subect to withholding or deduction for Taxes or is included in the income for tax purposes to of such Indemnified Party, the Indemnifying Party will pay a Tax Gross-Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.124.7, if an Indemnity Payment would otherwise be included in the Indemnified Party's ’s income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 4.6 shall not apply to any adjustment pursuant to the provisions of this Section 9.124.7. (c) The amount of any Loss for which indemnification is provided will be adjusted to take into account any Tax Benefit realized by the Indemnified Party or any of its Affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine the applicability, if any, of this subsection 9.12(c4.7(c) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties (the "“Independent Accountant"”). If the applicable Parties are unable to agree on the Independent Accountant within 10 days of the end of such 60 day period, any Party may apply under the Arbitration Act (OntarioAlberta) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c4.7(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c4.7(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution of the dispute shall be paid by the applicable Parties in such proportions as are determined by the Independent Accountant. The Independent Accountant will be deemed to be acting as an expert and not an arbitrator (unless appointed by a court under the Arbitration Act (OntarioAlberta) in which case the Independent Accountant will be deemed to be acting as an arbitrator).

Tax Effect. (a) If any Indemnity Payment payment received or accrued by an Indemnified Party hereunder (an "Indemnity Payment") would constitute income for tax purposes to such Indemnified Party, the Indemnifying Party will shall pay a Tax Gross-Gross Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, otherwise as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.12. (c) The amount of any Loss for which indemnification is provided will shall be adjusted to take into account any Tax Benefit tax benefit realized by in the Indemnified Party or any of its Affiliates affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each For purposes of this paragraph (f), any tax benefit shall be taken into account at such time as it is received by the Indemnified Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine or its affiliate. Notwithstanding the applicabilityforegoing provisions of this paragraph (f), if any, of this subsection 9.12(can Indemnity Payment is included in the Indemnified Party's income pursuant to paragraph 12(1)(x) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties Canadian Income Tax Act (or an equivalent provision of any relevant provincial legislation), the "Independent Accountant"). If the applicable Parties are unable Indemnified Party covenants and agrees to agree on the Independent Accountant within 10 days make an election pursuant to subsection 12(2.2) of the end of such 60 day period, any Party may apply under the Arbitration Canadian Income Tax Act (Ontarioand the equivalent provision of any applicable provincial legislation) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution Indemnity Payment to the maximum extent possible such that the amount of the dispute Indemnity Payment included the Indemnified Party's income for tax purposes is minimized or eliminated. For purposes of this paragraph (f), "Tax Gross Up" shall mean, with respect to any Indemnity Payment, such additional amount (calculated in accordance with the Calculation Method) as is necessary to place the Indemnified Party in the same after tax position as it would have been in had such Indemnity Payment been received tax free; and "Calculation Method" with respect to the calculation of any Tax Gross Up on any Indemnity Payments, shall mean that such Tax Gross Up shall be paid calculated by using the combined federal and provincial income tax rate applicable to the Indemnified Party and, except as provided in this paragraph (f), without regard to any losses, credits, refunds or deductions that the Indemnified Party may have which could affect the amount of tax payable on any such Indemnity Payment. Plan of Arrangement The parties acknowledge and agree that it is the intention of the parties that the acquisition of Common Shares by the Offeror (the "Acquisition") be effected in a manner that permits both Canadian and United States Shareholders to dispose of their Common Shares on a tax-deferred rollover basis (a "Tax Deferred Basis"). In order to achieve the foregoing objective, it is proposed that the Acquisition be effected pursuant to a Plan of Arrangement (the "Plan of Arrangement") under section 192 of the Canada Business Corporations Act ("CBCA") in a manner to permit Shareholders to obtain a rollover for Canadian income tax purposes under section 85.1, or, where the Shareholder elects, under section 85, of the Canadian Income Tax Act and any applicable Parties in such proportions as are determined by provincial tax legislation (collectively, "Canadian Income Tax Legislation") and to permit Shareholders to obtain a tax-free rollover for United States Tax Legislation") and to permit Shareholders to obtain a tax-free rollover for United States tax purposes pursuant to section 368(a)(1)(B) of the Independent AccountantUnited States Internal Revenue Code (a "B Reorganization"). The Independent Accountant will be deemed parties agree to be acting as an expert and not an arbitrator (unless appointed by cooperate to consummate the Plan of Arrangement pursuant to a court under B Reorganization for the Arbitration Act (Ontario) in which case the Independent Accountant will be deemed to be acting as an arbitrator)United States tax purposes.

Tax Effect. (a) If any Indemnity Payment payment received or accrued by an Indemnified Party hereunder (an "Indemnity Payment") would constitute income for tax purposes to such Indemnified Party, the Indemnifying Party will shall pay a Tax Gross-Gross Up to the Indemnified Party at the same time and on the same terms, as to interest and otherwise, as the Indemnity Payment. Notwithstanding the foregoing provisions of this Section 9.12, if an Indemnity Payment would otherwise be included in the Indemnified Party's income, the Indemnified Party covenants and agrees to make all such elections, filings, notifications or designations and take such actions as are available, acting reasonably, to minimize or eliminate Taxes with respect to the Indemnity Payment. (b) The provisions of Section 9.11 shall not apply to any adjustment pursuant to the provisions of this Section 9.12. (c) The amount of any Loss for which indemnification is provided will shall be adjusted to take into account any Tax Benefit tax benefit realized by the Indemnified Party or any of its Affiliates affiliates by reason of the Loss for which indemnification is so provided or the circumstances giving rise to such Loss. Each For purposes of this paragraph (f), any tax benefit shall be taken into account at such time as it is received by the Indemnified Party will, when requested in writing by another Party, use reasonable commercial efforts in cooperating with all other applicable Parties to determine or its affiliate. Notwithstanding the applicabilityforegoing provisions of this paragraph (f), if any, of this subsection 9.12(can Indemnity Payment is included in the Indemnified Party's income pursuant to paragraph 12(1)(x) to any claim. If such determination is not mutually agreed among the applicable Parties within 60 days of such written request, then the disagreement shall be submitted to an accounting firm of recognized national standing in Canada, which is independent of the Parties Canadian Tax Act (or an equivalent provision of any relevant provincial legislation), the "Independent Accountant"). If the applicable Parties are unable Indemnified Party covenants and agrees to agree on the Independent Accountant within 10 days make an election pursuant to subsection 12(2.2) of the end of such 60 day period, any Party may apply under the Arbitration Canadian Tax Act (Ontarioand the equivalent provision of any applicable provincial legislation) to have a court appoint such accounting firm. The Independent Accountant shall, as promptly as reasonable (but in any event within 45 days following its appointment), make a determination of the applicability of this subsection 9.12(c) to such claim on the basis contemplated herein, based on written submissions submitted by the applicable Parties to the Independent Accountant. The decision of the Independent Accountant as to the applicability of this subsection 9.12(c) to such claim shall be final and binding upon the Parties and will not be subject to appeal absent manifest error. The fees and expenses of the Independent Accountant with respect to the resolution Indemnity Payment to the maximum extent possible such that the amount of the dispute Indemnity Payment included in the Indemnified Party's income for tax purposes is minimized or eliminated. For purposes of this paragraph (f), "Tax Gross Up" shall mean, with respect to any Indemnity Payment, such additional amount (calculated in accordance with the Calculation Method) as is necessary to place the Indemnified Party in the same after tax position as it would have been in had such Indemnity Payment been received tax free; and "Calculation Method" with respect to the calculation of any Tax Gross Up on any Indemnity Payments, shall mean that such Tax Gross Up shall be paid calculated by using the combined federal and provincial income tax rate applicable to the Indemnified Party and, except as provided in this paragraph (f), without regard to any losses, credits, refunds or deductions that the Indemnified Party may have which could affect the amount of tax payable on any such Indemnity Payment. SCHEDULE D ALTERNATIVE TRANSACTION/ALTERNATIVE OFFER Plan of Arrangement The Offeror acknowledges and agrees that it is the intention of the parties that the acquisition of Common Shares by the Offeror (the "Acquisition") be effected in a manner that permits both Canadian and United States Shareholders to dispose of their Common Shares on a tax-deferred rollover basis (a "Tax Deferred Basis"). In order to achieve the foregoing objective, it is proposed that the Acquisition be effected pursuant to a Plan of Arrangement (the "Plan of Arrangement") under section 192 of the Canada Business Corporations Act ("CBCA") in a manner to permit Shareholders to obtain a rollover for Canadian income tax purposes under section 85.1, or, where the Shareholder elects, under section 85, of the Income Tax Act (Canada) (the "Canadian Income Tax Act") and any applicable Parties in such proportions as are determined by provincial tax legislation (collectively, "Canadian Income Tax Legislation") and to permit Shareholders to obtain a tax-free rollover for United States tax purposes pursuant to section 368(a)(1)(B) of the Independent AccountantUnited States Internal Revenue Code. The Independent Accountant will Offeror and the Sirois Group agree to cooperate to consummate the Plan of Arrangement ▇▇ ▇ Tax Deferred Basis for Canadian tax purposes. Proposed Steps Pursuant to the Plan of Arrangement, the following steps would be deemed to be acting as an expert and not an arbitrator (unless appointed by a court under the Arbitration Act (Ontario) in which case the Independent Accountant will be deemed to be acting as an arbitrator).undertaken: