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EXHIBIT 10.3
TAX INDEMNITY AGREEMENT
This TAX INDEMNITY AGREEMENT (the "Agreement"), dated as of this ___
day of April, 1998, by and between ZAPATA CORPORATION ("Zapata"), a Delaware
corporation, and OMEGA PROTEIN CORPORATION ("Protein"), a Nevada corporation.
R E C I T A L S:
A. Zapata, a public company whose common shares are traded on the New
York Stock Exchange, owns 19,676,000 shares of Protein's common stock, par value
$.01 per share (the "Common Stock"), constituting all of the issued and
outstanding Common Stock;
B. On even date herewith Protein and Zapata have entered into an
Underwriting Agreement with Prudential Incorporated and Deutsche Morgan
Grenfell, Inc., as representatives of the several underwriters named therein,
which contemplates that Protein and Zapata will conduct an initial public
offering in which Protein will issue 4,000,000 shares of Common Stock and Zapata
will sell 4,000,000 shares of Common Stock (the "IPO") (together with up to an
additional 1,200,000 shares of Common Stock which shall be subject to
over-allotment options granted on an equal basis by Protein and Zapata to the
IPO underwriters) reducing Zapata's ownership of Protein to approximately 66.2%
of the outstanding Common Stock (prior to the exercise of the over-allotment
options referred to below), all as more particularly described in the
registration statement on Form S-1 (Registration No. 333-44967) filed by Protein
with the Securities and Exchange Commission (the "SEC") on or about January 27,
1998; and
C. In connection with the IPO, Zapata and Protein have entered into a
Separation Agreement on even date herewith (the "Separation Agreement") which
requires, among other things, Zapata and Protein to enter into this Agreement to
address certain tax issues involving Zapata and Protein that will arise after
the IPO after Zapata's ownership of Protein is less than 80% of Protein's issued
and outstanding shares as a result of which neither Protein nor any Protein
Post-Closing Affiliates (hereinafter defined)l will file Tax Returns
(hereinafter defined) as a member of the Zapata Group (hereinafter defined); and
NOW, THEREFORE, in consideration of their mutual promises, Zapata and
Protein agree as follows:
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ARTICLE 1
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings:
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor thereto, as in effect for the taxable period in question.
"Consolidated Group" means the group of corporations that
immediately prior to the Effective Date are members of the affiliated group of
corporations (within the meaning of Section 1504 of the Code) of which Zapata is
the common parent.
"Effective Date" means the date upon which Zapata ceases to
own 80% of the issued and outstanding shares of Protein.
"Final Determination" shall mean the final resolution of
liability for any Tax for a taxable period, including any related interest or
penalties, (a) by Internal Revenue Service Form 870 or 870-AD (or any successor
forms thereto), on the date of acceptance by or on behalf of the Internal
Revenue Service ("IRS"), or by a comparable form under the laws of other
jurisdictions; except that a Form 870 or 870-AD or comparable form that reserves
(whether by its terms or by operation of law) the right of the taxpayer to file
a claim for refund and/or the right of the Taxing Authority to assert a further
deficiency shall not constitute a Final Determination; (b) by a decision,
judgment, decree, or other order by a court of competent jurisdiction, which has
become final and unappealable; (c) by a closing agreement or accepted offer in
compromise under Section 7121 or 7122 of the Code, or comparable agreements
under the laws of other jurisdictions; (d) by any allowance of a refund or
credit in respect of an overpayment of Tax, but only after the expiration of all
periods during which such refund may be recovered (including by way of offset)
by the Tax imposing jurisdiction; or (e) by any other final disposition,
including by reason of the expiration of the applicable statute of limitations.
"Protein Businesses" means the present and future
subsidiaries, divisions and business of Protein and any member of the Protein
Post-Closing Affiliates.
"Protein Post-Closing Affiliate" means any corporation,
partnership or other entity directly or indirectly controlled by Protein after
the Effective Date.
"Protein Pre-Closing Affiliate" means any corporation,
partnership or other entity directly or indirectly controlled by Protein on or
before the Effective Date.
"Representative" means with respect to any person or entity,
any of such person's or entity's directors, officers, employees, agents,
consultants, advisors, accountants, attorneys, and representatives.
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"Tax" or "Taxes" means (a) all forms of taxation, whenever
created or imposed, and whenever imposed by a national, municipal, governmental,
state, federal or other body, whether domestic or foreign (a "Taxing
Authority"), and without limiting the generality of the foregoing, shall include
net income, alternative or add-on minimum tax, gross income, sales, use, ad
valorem, gross receipts, value added, franchise, profits, license, transfer,
recording, withholding, payroll, employment, excise, severance, stamp,
occupation, premium, property, windfall profit, custom duty, or other tax,
governmental fee or other like assessment or charge of any kind whatsoever,
together with any related interest, penalties, or other additions to tax, or
additional amounts imposed by any such Taxing Authority, (b) liability for the
payment of any amounts of the type described in (a) as a result of being a
member of an affiliated, consolidated, combined or unitary group for any period,
including any liability arising pursuant to Treas. Reg. Section 1.1502-6, or as
a result of being a party to any agreement or arrangement whereby liability for
payment of such amounts was determined or taken into account with reference to
the liability of another party and (c) liability for the payment of any amounts
of the type described in (a) as a result of any express or implied obligation to
indemnify any other person.
"Taxing Authority" is defined under the term "Taxes."
"Taxable Period" or "Taxable Periods" means the tax year for
the "Consolidated Group" as defined in this Article 1.
"Tax Return" means any return, filing, questionnaire or other
document required to be filed, including requests for extensions of time,
filings made with estimated Tax payments, claims for refund and amended returns
that may be filed, for any taxable period with any Taxing Authority in
connection with any Tax (whether or not a payment is required to be made with
respect to such filing).
"Zapata Affiliate" means any corporation, partnership or other
entity directly or indirectly controlled by Zapata, other than Protein or any
Protein Affiliate.
"Zapata Businesses" means the present and future subsidiaries,
divisions and business of any member of the Zapata Group, other than the present
and future subsidiaries, divisions and business of Protein or any Protein
Post-Closing Affiliates.
"Zapata Group" means the group of corporations that
immediately after the Effective Date are members of the affiliated group of
corporations of which Zapata is the common parent (within the meaning of section
1504 of the Code).
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ARTICLE 2
PREPARATION AND FILING OF TAX RETURNS
2.1 INCOME INCLUDED. All Tax Returns required to be filed by the
Consolidated Group relating to Taxable Periods ending before or including the
Effective Date and filed after the date of this Agreement shall include the
income of Protein and Protein Pre-Closing Affiliates (as determined in this
Section 2.1) attributable to such Taxable Periods (including, for Federal income
Tax purposes, any deferred income triggered into income by Treas. Reg. Section
1.1502-13 and Treas. Reg. Section 1.1502-14 and any excess loss accounts taken
into income under Treas. Reg. Section 1.1502-19) required to be reported in the
Consolidated Group's consolidated Federal income Tax Returns (or under any
similar rules applicable to any state, local or other Tax Returns filed on a
consolidated basis). The income of Protein and Protein Pre-Closing Affiliates
will be apportioned for the period October 1, 1997 up to and including the
Effective date and the period after the Effective Date by closing the books of
Protein and such Protein Pre-Closing Affiliates as of the end of the Effective
Date. The income of Protein and any Protein Pre-Closing Affiliate shall not
include any deferred income triggered into income by Treas. Reg. Section
1.1502-13 and Treas. Reg. 1.1502-14 and any excess loss accounts taken into
income under Treas. Reg. Section 1.1502-19, attributable to any other member of
the Consolidated Group.
2.2 TAX RETURNS FOR TAXABLE PERIODS ENDING BEFORE OR INCLUDING THE
EFFECTIVE DATE. Except as otherwise provided in Section 2.4, Zapata shall timely
prepare and file, or cause to be timely prepared and filed, all Tax Returns
required to be filed by or on behalf of any member of the Consolidated Group
relating to Taxable Periods ending before or including the Effective Date.
Protein shall provide Zapata any Tax-related information reasonably requested by
Zapata relating to any Taxable Periods ending on or before the Effective Date.
2.3 TAX RETURNS FOR TAXABLE PERIODS BEGINNING AFTER THE EFFECTIVE DATE.
Protein shall prepare and file, or cause to be prepared and filed, all Tax
Returns for Protein and any Protein Post-Closing Affiliate for taxable periods
of Protein and any Protein Post-Closing Affiliate beginning after the Effective
Date. Zapata shall prepare and file, or cause to be prepared and filed, all Tax
Returns for the Zapata Group for Taxable Periods beginning after the Effective
Date.
2.4 CARRY-OVER PERIOD RETURNS.
(a) Protein shall prepare and file on a timely basis any Tax
Returns (but not including any Federal income Tax Return or Tax Returns under
any similar rules applicable to any state or local, and filed on a consolidated
basis) of Protein and any Protein Pre-Closing Affiliate for any Taxable Period
beginning before and ending after the Effective Date (a "CarryOver Period").
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(b) All other Tax Returns for a Carry-Over Period required to
be filed by any member of the Consolidated Group other than Protein or any
Protein Pre-Closing Affiliate shall be prepared and filed by Zapata.
ARTICLE 3
PAYMENT OF TAXES
3.1 LIABILITY FOR TAXES WITH RESPECT TO TAXABLE PERIODS ENDING BEFORE
OR INCLUDING THE EFFECTIVE DATE. Except as otherwise provided in this Agreement,
Zapata shall be responsible for paying and shall pay all Taxes relating to any
Tax Return filed by the Consolidated Group or any member thereof with respect to
any Taxable Period ending before and including the Effective Date, including
without limitation, any additional Taxes as a result of any audit, amendment or
other change in a Tax Return as filed by the Consolidated Group or any member
thereof.
3.2 PREPARATION OF PROTEIN'S FINAL RETURNS; PAYMENT OF TAXES. On or
before _____________, 1998, Zapata shall cause to be prepared (in a manner
consistent with practices followed in prior years) and delivered to Protein a
separate United States federal income tax return for Protein and each Protein
Pre-Closing Affiliate for the period beginning October 1, 1997 and ending on the
Effective Date (the "Protein Final Returns"). The Protein Final Returns shall
include all items of income, gain, loss, deductions and credit of Protein and
the Protein Pre-Closing Affiliates realized during such period and determined
and apportioned in accordance with Section 2.1. Zapata shall include in its
consolidated federal income tax for its first taxable year ending after the
Effective Date the items of income, gain, loss, deductions and credit shown on
the Protein Final Returns and shall pay all Taxes due with respect thereto as
provided in this Section 3.2 and Section 3.1.
3.3 SEPARATION PAYMENT WITH RESPECT TO FEDERAL INCOME TAXES. Zapata
shall give Protein notice of the filing of Zapata's consolidated federal income
tax returns for its first taxable year ending after the Effective Date ("Final
Return Notice"). If the Protein Final Returns show a tax liability, Protein
shall pay to Zapata the amount thereof within thirty (30) days after receipt by
Protein of the Final Return Notice. Zapata shall not withdraw any earnings or
assets of Protein or any Protein Pre-Closing Affiliates prior to the Effective
Date. If the Protein Final Returns show a net operating loss or other tax
benefit that is utilized by Zapata or any member of the Zapata Group and,
therefore, is not allocated to the entity incurring such tax benefit pursuant to
Treas. Reg. ss.1.1502-79, Zapata shall pay to Protein (or the appropriate
entity) the amount of any tax savings to be realized thereby within thirty (30)
days after receipt by Protein of the Protein Final Returns.
3.4 ALLOCATION OF EARNINGS AND PROFITS FOR TAXABLE PERIODS ENDING
BEFORE OR INCLUDING THE EFFECTIVE DATE. All earnings and profits of the
Consolidated Group for all Taxable Periods ending before or including the
Effective Date shall be allocated pursuant to Section 1552 of the Code among the
members of the Consolidated Group in accordance with
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the ratio which that portion of the consolidated taxable income attributable to
each member of the Consolidated Group having taxable income bears to the
consolidated taxable income of the Consolidated Group in accordance with Section
1552(a)(1) of the Code and the Regulations thereunder.
3.5 UNUSED CARRY-FORWARD ATTRIBUTES. Zapata and Protein agree that, for
purposes of all required returns and reports with respect to Taxes, the amount
of unused tax credits under the Code attributable to Protein and each of the
Protein Pre-Closing Affiliates that may be carried forward to Taxable Periods
ending after the Effective Date shall, unless otherwise required by law or
regulations, be determined in accordance with the principles of Treas. Reg.
ss.1.1502-79(c). Any other carry-forward attributes shall similarly be
determined in accordance with applicable regulations.
3.6 LIABILITY FOR TAXES WITH RESPECT TO POST-EFFECTIVE DATE TAXABLE
PERIODS. The Zapata Group shall pay all Taxes of the Zapata Group and shall be
entitled to receive and retain all refunds of Taxes of the Zapata Group with
respect to Taxable Periods beginning after the Effective Date which are
attributable to the Zapata Businesses. Protein shall pay all Taxes of Protein
and any Protein Post-Closing Affiliate and shall be entitled to receive and
retain all refunds of Taxes of Protein and any Protein Post-Closing Affiliate
for all periods beginning after the Effective Date which are attributable to the
Protein Businesses.
3.7 CARRY-OVER PERIOD PAYMENTS. Zapata shall be responsible for (and
shall pay) any Taxes shown to be due on a Tax Return for a Carry-Over Period
filed pursuant to Section 2.4(b) hereof by any member of the Consolidated Group
other than Protein or a Protein Pre-Closing Affiliate. Protein shall be
responsible for (and shall pay) any Taxes shown to be due on a Tax Return for a
Carry-Over Period filed by Protein and any Protein Pre-Closing Affiliate
pursuant to Section 2.4(a) hereof.
3.8 CARRY-BACKS. Protein shall be entitled to any refund of any Tax
obtained by the Consolidated Group (or any member of the Consolidated Group),
including any refund obtained as a result of the carry-back of losses or credits
of Protein or any Protein Post-Closing Affiliate from any taxable period
beginning after the Effective Date to any Taxable Period ending before or
including the Effective Date. The application of any such carry-backs by Protein
and/or any other current or former member of the Consolidated Group shall be in
accordance with the Code and the Treasury Regulations promulgated thereunder.
Notwithstanding this Section 3.9, Protein and any Protein Post-Closing Affiliate
shall have the right, in its sole discretion, to make any election, including
the election under Section 172(b)(3) of the Code, which would eliminate or limit
the carry-back of any loss or credit to any Taxable Period ending before or
including the Effective Date.
3.9 POST-CLOSING ELECTIONS. At Zapata's request, Protein and the
Protein Pre-Closing Affiliates shall make and/or join with Zapata in making any
Tax elections reasonably requested by Zapata after the Effective Date, if the
making of such election does not have a material
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adverse impact on Protein or any Protein Pre-Closing Affiliate for any
post-Effective Date Tax period.
3.10 REFUNDS. Protein and any Protein Pre-Closing Affiliate shall be
entitled to any refund of any Tax obtained by the Consolidated Group (or any
member of the Consolidated Group) as a result of any audit, amendment or other
change in the Tax Return as filed by the Consolidated Group or any member
thereof to the extent the refund is attributable to Protein and any Protein
Pre-Closing Affiliate for any Taxable Period of the Consolidated Group ending
before or including the Effective Date. Zapata will cooperate with Protein and
any Protein Pre-Closing Affiliate in obtaining such refunds, including, but not
limited to, the filing of amended Tax Returns or refund claims. Zapata will
immediately pay to Protein and any Protein Pre-Closing Affiliate any Tax refund
described in this Section 3.10 when such refund is received by the Zapata Group.
With the exception of Section 3.8, all other refunds arising from Tax Returns
filed for the Consolidated Group will belong to Zapata.
ARTICLE 4
COOPERATION AND EXCHANGE OF INFORMATION
4.1 COOPERATION. Protein shall cooperate (and shall cause any Protein
Post-Closing Affiliate to cooperate) fully at such time and to the extent
reasonably requested by Zapata in connection with the preparation and filing of
any Tax Return or the conduct of any audit, dispute, proceeding, suit or action
concerning any issues or any other matter contemplated hereunder relating to any
Taxable Period ending before or including the Effective Date. Such cooperation
shall include, without limitation, (a) the retention and provision on demand of
copies of books, records, documentation or other information relating to any
such Tax Return until the later of (i) the expiration of the applicable statute
of limitation (giving effect to any extension, waiver, or mitigation thereof)
and (ii) in the event any claim has been made under this Agreement for which
such information is relevant, until a Final Determination with respect to such
claim; (b) the execution of any document that may be necessary or reasonably
helpful in connection with the filing of any such Tax Return, or in connection
with any audit, proceeding, suit or action addressed in the preceding sentence;
and (c) the use of the parties' reasonable best efforts to obtain any
documentation from a governmental authority or a third party that may be
necessary or helpful in connection with the foregoing. Each party shall make its
employees and facilities available on a mutually convenient basis to facilitate
such cooperation.
4.2 TAX RETURNS FOR TAXABLE PERIODS INCLUDING THE EFFECTIVE DATE.
Zapata will provide Protein with the opportunity to review and comment upon any
Tax Returns to be filed after the date of this Agreement (including any amended
returns), and will provide Protein, promptly upon its request, with copies of
such Tax Returns (including any amended returns).
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4.3 AUDITS. Zapata will allow Protein and any Protein Pre-Closing
Affiliate and its counsel to participate (at the expense of Protein or its
Protein Pre-Closing Affiliate) in any audits of Zapata's Consolidated Federal
Income Tax Returns to the extent that such returns relate to Protein and any
Protein Pre-Closing Affiliate. Zapata will not settle any such audit in a manner
which would adversely affect Protein and any Protein Pre-Closing Affiliate
without the prior written consent of Protein, which consent shall not be
unreasonably withheld.
4.4 CARRYBACKS. Zapata will immediately pay to Protein and any Protein
Pre-Closing Affiliate any Tax refund (or reduction in Tax liability) resulting
from a carryback of a post-acquisition tax attribute of Protein and any Protein
Pre-Closing Affiliates into the Zapata Consolidated Group Tax Return, when such
refund or reduction is realized by the Zapata Group. Zapata will cooperate with
Protein and any Protein Pre-Closing Affiliate in obtaining such refunds (or
reduction in Tax liability), including, but not limited to, the filing of
amended Tax Returns or refund claims.
4.5 CONTEST PROVISIONS. Zapata shall have full responsibility and
discretion in the handling of any Tax controversy, including, without
limitation, an audit, a protest to the Appeals Division of the IRS, and
litigation in Tax Court or any other court of competent jurisdiction involving a
Tax Return of the Consolidated Group or the Zapata Group.
ARTICLE 5
MISCELLANEOUS
5.1 TAX INDEMNIFICATION.
(a) Zapata shall defend, indemnify and hold harmless Protein and
each Protein Pre-Closing Affiliate from and against any liability, cost or
expense, including, without limitation, any fine, penalty, interest, charge or
reasonable accountant's fee, for any Tax required under this Agreement to be
paid by Zapata or any member of the Consolidated Group other than Protein or a
Protein Pre-Closing Affiliate.
(b) Protein shall indemnify and hold harmless Zapata and each
member of the Zapata Group from and against any liability, cost or expense,
including without limitation, any fine, penalty, interest, charge or reasonable
accountant's fee, for any Tax required under this Agreement to be paid by
Protein or any Protein Post-Closing Affiliate.
(c) The amount of any payment made with respect to this Section 5.1
shall include any additional amount necessary to indemnify the recipient of the
payment against any Taxes imposed or incurred (including any increase in
liability or taxes resulting from a reduction in the amount of the loss), and
any reasonable professional fees or other litigation costs incurred, in
connection with such payment, and (ii) be reduced by the amount of any tax
benefit realized or to be realized by the recipient as a result of its payment
of the Taxes being indemnified hereunder.
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5.2 BREACH. Zapata shall defend, indemnify and hold harmless Protein
and each Protein Pre-Closing Affiliate and Protein shall indemnify and hold
harmless each member of the Zapata Group from and against any payment required
to be made under this Agreement as a result of the breach by a member of the
Zapata Group or by Protein or a Protein Pre-Closing Affiliate, as the case may
be, of any obligation under this Agreement.
5.3 RESOLUTION OF CERTAIN DISPUTES.
(a) Arbitration. Disagreements between Zapata and Protein with
respect to amounts that either claims is owed by the other (or by an Affiliate
of the other) under this Agreement, or other matters under this Agreement that
are not resolved by mutual agreement, shall be resolved by arbitration pursuant
to this Section 5.3.
(b) Selection of the Arbitrator. Any arbitrator selected pursuant
to this Section 5.3(b) shall have at least ten (10) years of experience in the
field of corporate taxation, shall be an attorney licensed to practice law in
any state of the United States or a certified public accountant licensed to
practice in any state of the United States and shall not be or have been
employed by or affiliated with either party. The parties shall first attempt to
agree on a mutually satisfactory arbitrator. If the parties are unable to agree
on a mutually satisfactory arbitrator within thirty (30) days after either party
notifies the other in writing of a disagreement requiring arbitration pursuant
to this Section 5.3 (15 days in the case of a disagreement with respect to
Section 4.1 through Section 4.5), each party shall select an arbitrator. The two
arbitrators thus selected shall agree on and select a third arbitrator. If the
two arbitrators cannot agree on such third arbitrator within thirty (30) days
(fifteen (15) days in the case of a disagreement with respect to Section 4.1
through Section 4.5), the parties shall each select a different arbitrator and
renew the foregoing procedure. If the position of an arbitrator is vacated, the
person or persons who originally selected the arbitrator to fill such position
shall select a new arbitrator to fill the position, unless the parties agree to
continue the arbitration with the remaining arbitrators. When used hereinafter,
the term "arbitrator" shall refer to the three arbitrators so selected when
appropriate and a decision of a majority of such arbitrators shall constitute a
decision by the arbitrator in the appropriate context.
(c) Arbitration Procedures.
(i) The arbitration shall be conducted under the auspices of
the American Arbitration Association.
(ii) Each party within thirty (30) days after engagement of
the arbitrator (fifteen (15) days in the case of a disagreement with
respect to Section 4.1 through Section 4.5) shall submit to the
arbitrator a written statement of the party's position (including where
relevant the total net amount it asserts is owed by it or is due to it)
regarding the total amount in dispute.
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(iii) The arbitrator shall base his decision on the
following standards. In the case of a factual dispute between the
parties, the arbitrator shall make a determination of the correct
facts. In the case of a dispute regarding a legal issue, including the
proper application of the Tax laws or the proper interpretation of this
Agreement, the arbitrator shall make a determination in accordance with
his best legal judgment. Upon making determinations with respect to all
factual and legal issues in dispute, the arbitrator shall determine the
amount due by one party to the other or such other matter with respect
to the matter subject to the arbitration. Where relevant, as to each
matter in dispute, the arbitrator shall find in favor of the party
whose statement submitted pursuant to paragraph (ii) above proposed the
amount closest to the amount so determined.
(iv) The arbitrator shall render a written decision
stating only the result of such decision as soon as practicable. The
arbitrator shall also orally explain the bases of such decision to both
parties as soon as practicable. If and only if both parties request,
the arbitrator shall state the bases of such decision in writing. Where
relevant, as to each matter in dispute, the arbitrator's decision shall
be in an amount equal to one of the total amounts asserted by one of
the parties in the written statements submitted pursuant to paragraph
(ii) above. The arbitrator shall not, and is not authorized to, render
a decision in any other amount.
(v) The arbitrator's decision shall be final and binding
on the parties. No appeal to any court is contemplated by this
Agreement and each party, to the maximum extent permissible by law,
waives and relinquishes all rights and entitlements to appeal such
decision.
(vi) The arbitrator shall determine a fair allocation of
the costs of the arbitration proceeding (including each party's legal
fees) as between the parties.
5.4 NOTICES. Any notice, demand, claim or other communication under
this Agreement shall be in writing and shall be deemed given upon delivery if
delivered personally, upon mailing if sent by certified mail, return receipt
requested, postage prepaid, or upon completion of transmission if sent by
telecopy or facsimile, to the parties at the following address:
If to Zapata: Zapata Corporation
1717 St. James Place, Suite 550
Houston, Texas 77056
Attention: Avram Glazer, Chief Executive
Officer
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If to Protein: Omega Protein, Inc.
1717 St. James Place, Suite 550
Houston, Texas 77056
Attention: Joseph von Rosenberg III,
Chief Executive Officer and
President
5.5 ENTIRE AGREEMENT. This Agreement and the applicable provisions of
the Separation Agreement constitute the entire agreement of the parties
concerning the subject matter hereof, and supersedes all other agreements,
whether or not written, in respect of any Tax between or among any member or
members of the Zapata Group, on the one hand, and Protein and any Protein
Pre-Closing Affiliate, on the other hand. This Agreement may not be amended
except by an agreement in writing, signed by the parties hereto. In the event
and to the extent that there shall be a conflict between the provisions of this
Agreement and the Separation Agreement, the provisions of this Agreement shall
control.
5.6 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with, the laws of the State of Texas.
5.7 SUCCESSORS AND ASSIGNS. A party's rights and obligations under
this Agreement may not be assigned without the prior written consent of the
other party. All of the provisions of this Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns.
5.8 NO THIRD-PARTY BENEFICIARIES. This Agreement is solely for the
benefit of the parties to this Agreement and their respective subsidiaries and
should not be deemed to confer upon third parties any remedy, claim, liability,
reimbursement, claim of action or other right in excess of those existing
without this Agreement.
5.9 LEGAL ENFORCEABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to that jurisdiction,
be ineffective to the extent of the prohibition or unenforceability without
invalidating the remaining provisions. Any prohibition or unenforceability of
any provision of this Agreement in any jurisdiction shall not invalidate or
render unenforceable the provision in any other jurisdiction.
5.10 EXPENSES. Unless otherwise expressly provided in this Agreement
or in the Separation Agreement, each party shall bear any and all expenses that
arise from their respective obligations under this Agreement. In the event
either party to this Agreement brings an action or proceeding for the breach or
enforcement of this Agreement, the prevailing party in such action or
proceeding, whether or not such action or proceeding proceeds to final judgment,
shall be entitled to recover as an element of its costs, and not as damages,
such reasonable attorneys' fees as may be awarded in the action or proceeding in
addition to whatever other relief to which the prevailing party may be entitled.
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5.11 CONFIDENTIALITY. Each party shall hold and cause its
Representatives to hold in strict confidence, unless compelled to disclose by
judicial or administrative process or, in the opinion of its counsel, by other
requirements of law, all information (other than any such information relating
solely to the business or affairs of such party) concerning the other parties
hereto furnished it by such other party or its Representatives pursuant to this
Agreement (except to the extent that such information can be shown to have been
(a) previously known by the party to which it was furnished, (b) in the public
domain through no fault of such party, or (c) later lawfully acquired from other
sources by the party to which it was furnished), and each party shall not
release or disclose such information to any other person, except its auditors,
attorneys, financial advisors, bankers and other consultants and advisors who
shall be advised of the provisions of this Section. Each party shall be deemed
to have satisfied its obligation to hold confidential information concerning or
supplied by the other party if it exercises the same care as it takes to
preserve confidentiality for its own similar information.
5.12 COUNTERPARTS. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signature thereto and hereto were upon the same instrument.
5.13 HEADINGS. Introductory headings used in this Agreement are solely
for the convenience of the parties and shall not be deemed to be limitations
upon or descriptive of the contents of the Section or Sub-sections concerned.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
OMEGA PROTEIN CORPORATION
By:
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Name:
Title:
ZAPATA CORPORATION
By:
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Name:
Title
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