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Exhibit 10.2
TAX SHARING AGREEMENT
BETWEEN
CPC INTERNATIONAL INC.
AND
CORN PRODUCTS INTERNATIONAL, INC.
DATED DECEMBER 1, 1997
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ARTICLE 1 - DEFINITIONS..................................................... 2
SECTION 1.01. GENERAL...................................................... 2
ARTICLE 2 - TAX RETURN FILING............................................... 7
SECTION 2.01. CPC CONSOLIDATED RETURNS..................................... 7
SECTION 2.02. CORN F.I.T. RETURNS.......................................... 8
SECTION 2.03. CPC STATE OR LOCAL RETURNS................................... 8
SECTION 2.04. CORN STATE OR LOCAL RETURNS.................................. 9
SECTION 2.05. CPC SALARIED EMPLOYEE RETURNS................................ 9
SECTION 2.06. CPC HOURLY EMPLOYEE RETURNS.................................. 10
SECTION 2.07. CORN EMPLOYEE RETURNS........................................ 10
SECTION 2.08. CPC SALES, USE AND PROPERTY TAX RETURNS...................... 11
SECTION 2.09. CORN SALES, USE AND PROPERTY TAX RETURNS..................... 12
SECTION 2.10. OTHER CPC RETURNS............................................ 12
SECTION 2.11. OTHER CORN RETURNS........................................... 13
SECTION 2.12. FOREIGN DISTRIBUTING ENTITY RETURNS.......................... 13
SECTION 2.13. CORN FOREIGN RETURNS......................................... 14
SECTION 2.14. DESIGNATION OF AGENT......................................... 14
SECTION 2.15. POST-DISTRIBUTION DATE RETURNS AND
POSITION--NO INCONSISTENT POSITIONS.......................... 15
ARTICLE 3 - TAX LIABILITY................................................... 16
SECTION 3.01. CPC LIABILITY................................................ 16
SECTION 3.02. CORN LIABILITY............................................... 16
ARTICLE 4 - POST-DISTRIBUTION CARRYBACKS OF TAX BENEFITS.................... 17
SECTION 4.01. CARRYBACK PROVISIONS......................................... 17
ARTICLE 5 - POST-DISTRIBUTION CARRYOVERS OF TAX BENEFITS AND ATTRIBUTES..... 18
SECTION 5.01. CPC GROUP ITEMS.............................................. 18
SECTION 5.02. EARNINGS AND PROFITS......................................... 19
ARTICLE 6 - ADJUSTMENTS..................................................... 19
SECTION 6.01. CPC RETURNS AND FOREIGN DISTRIBUTING ENTITY RETURNS.......... 19
SECTION 6.02. CORN RETURNS................................................. 21
SECTION 6.03. EXPENSES..................................................... 21
ARTICLE 7 - CONTESTS........................................................ 22
SECTION 7.01. CPC, CPC COMPANY, AND FOREIGN DISTRIBUTING ENTITY CONTESTS;
NOTIFICATION AND COMMUNICATION............................... 22
SECTION 7.02. GROUP CONTESTS; CONTROL AND MANAGEMENT OF CLAIMS............. 22
ARTICLE 8 - INFORMATION AND COOPERATION; BOOKS AND RECORDS.................. 24
SECTION 8.01. GENERAL...................................................... 24
ARTICLE 9 - GENERAL PROVISIONS.............................................. 26
SECTION 9.01. EFFECTIVENESS................................................ 26
SECTION 9.02. NOTICES...................................................... 26
SECTION 9.03. COMPLETE AGREEMENT; CONSTRUCTION............................. 27
SECTION 9.04. COUNTERPARTS................................................. 27
SECTION 9.05. WAIVER....................................................... 27
SECTION 9.06. AMENDMENTS................................................... 28
SECTION 9.07. SUCCESSORS AND ASSIGNS....................................... 28
SECTION 9.08. SUBSIDIARIES................................................. 28
SECTION 9.09. THIRD PARTY BENEFICIARIES.................................... 28
SECTION 9.10. HEADINGS..................................................... 29
SECTION 9.11. SPECIFIC PERFORMANCE......................................... 29
SECTION 9.12. GOVERNING LAW................................................ 29
SECTION 9.13. ARBITRATION.................................................. 30
SECTION 9.14. SEVERABILITY................................................. 30
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TAX SHARING AGREEMENT
This TAX SHARING AGREEMENT (this "Agreement") is dated as of ________,
1997, by and between CPC INTERNATIONAL INC., a Delaware corporation ("CPC") and
CORN PRODUCTS INTERNATIONAL, INC., a Delaware corporation ("Corn").
WITNESSETH
WHEREAS, CPC is the common parent of an affiliated group of corporations
which includes Corn and which group and the members thereof file U.S.
consolidated federal income tax returns;
WHEREAS, CPC, as well as its foreign and domestic subsidiaries file
certain other Tax returns relating to U.S. and foreign Taxes;
WHEREAS, the Board of Directors of CPC has determined that it is
appropriate and desirable to effect the Distribution as described in the
Distribution Agreement between CPC and Corn dated, , 1997 (the
"Distribution Agreement"), subject to the satisfaction or waiver of the
conditions set forth therein;
WHEREAS, the Board of Directors of CPC has determined that it is
appropriate and desirable to take all corporate action and to cause its
subsidiaries to take all corporate action necessary to effect the division of
certain foreign direct and indirect subsidiaries of CPC as of specified dates
to be determined (each such date shall sometimes hereinafter be referred to as
the "Applicable Foreign Distribution Date"); and
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WHEREAS, the parties hereto desire to set forth their agreements with
regard to their respective liabilities for federal, state, local and foreign
Taxes herein (and with respect to Taxes of certain Pakistani entities, in the
Annex to this Agreement) for Tax periods before and after the Distribution Date
and the Applicable Foreign Distribution Dates, and to provide for certain other
Tax matters.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained in this Agreement, the parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. General. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Affiliate" shall mean, when used with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
will control, or will be controlled by or will be under common control with the
Person specified immediately following the Distribution Date.
"Agreement" shall have the meaning described in the above preamble.
"Annex" shall mean that certain document attached to this Agreement
executed by the parties on even date herewith setting forth the agreements of
the parties with respect to Taxes of certain Pakistani entities.
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"Applicable Foreign Distribution Date" shall have the meaning described in
the above preamble.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Corn" shall have the meaning described in the above preamble.
"Corn Companies" shall mean, collectively, Corn and each subsidiary of
Corn, including without limitation any entity owned directly or beneficially by
Corn after the Distribution Date (or, if later, the Applicable Foreign
Distribution Date).
"Corn Division" shall mean the division of CPC that operates CPC's U.S.
corn refining business before the Distribution Date.
"Corn Domestic Companies" shall mean, collectively, each Corn Company
incorporated or organized under the laws of one of the respective States of the
United States.
"Corn Employee Returns" shall have the meaning described in Section 2.07
below.
"Corn F.I.T. Return" shall mean any federal income tax return or amendment
thereof of Corn or any member of the Corn Group, including any consolidated
federal income tax return or amendment thereof of the Corn Group.
"Corn Foreign Returns" shall have the meaning set forth in Section 2.13
below.
"Corn Group" shall mean the affiliated group of corporations as defined in
Section 1504(a) of the Code of which Corn is the common parent.
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"Corn Return" shall mean any of a Corn F.I.T. Return, any of the Corn
State or Local Returns, a Corn Employee Return, any Corn Foreign Return, any of
the Corn Sales, Use and Property Tax Returns, and any Other Corn Return.
"Corn Sales, Use and Property Tax Returns" shall have the meaning
described in Section 2.09 below.
"Corn State or Local Returns" shall have the meaning described in Section
2.04 below.
"CPC" shall have the meaning described in the above preamble.
"CPC Companies" shall mean, collectively, CPC and each subsidiary of CPC.
"CPC Consolidated Return" shall mean any consolidated federal income tax
return or amendment thereof of the CPC Group which includes one or more of the
Corn Domestic Companies.
"CPC Consolidated Return Period" shall mean a tax period for which a CPC
Consolidated Return is filed.
"CPC Group" shall mean the affiliated group of corporations as defined in
Section 1504(a) of the Code of which CPC is the common parent.
"CPC Hourly Employee Returns" shall have the meaning described in Section
2.06 below.
"CPC Return" shall mean any of a CPC Consolidated Return, any of the CPC
State or Local Returns, a CPC Salaried Employee Return, a CPC Hourly Employee
Return, any of the CPC Sales, Use and Property Tax Returns, or any Other CPC
Return.
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"CPC Salaried Employee Returns" shall have the meaning described in
Section 2.05 below.
"CPC Sales, Use and Property Tax Returns" shall have the meaning described
in Section 2.08 below.
"CPC State or Local Returns" shall have the meaning described in Section
2.03 below.
"CPC Subsidiary" shall mean any subsidiary of CPC other than any of the
Corn Companies.
"Distribution" shall mean the distribution by CPC to its public
shareholders of the stock of Corn as more particularly described in the
Distribution Agreement and any transactions relating thereto.
"Distribution Agreement" shall have the meaning described in the above
preamble.
"Distribution Date" shall be the date on which the Distribution occurs.
"Foreign Distributed Entity" shall mean a newly created foreign company
that will conduct corn refining business operations after the Applicable
Foreign Distribution Date, and that will be owned by Corn after the later of
the Distribution Date or the Applicable Foreign Distribution Date.
"Foreign Distributing Entities" shall mean the foreign CPC Subsidiaries
that prior to the Applicable Foreign Distribution Date conduct both corn
refining business operations and consumer foods business operations in a single
entity.
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"Foreign Distributing Entity Return" shall mean any foreign Tax return or
amendment thereof of a Foreign Distributing Entity.
"IRS" shall mean the Internal Revenue Service.
"IRS Penalty Rate" shall mean the rate of interest imposed from time to
time on underpayments of income Tax pursuant to Code section 6621.
"IRS Ruling" shall mean the ruling issued by the IRS which states the tax
treatment of the Distribution and related transactions.
"Other Corn Returns" shall have the meaning described in Section 2.11
below.
"Other CPC Returns" shall have the meaning described in Section 2.10
below.
"Person" shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership or government, or any agency or
political subdivision thereof.
"Tax" shall mean all federal, state, local and foreign gross or net
income, gross receipts, sales, use, ad valorem, VAT, GST, franchise, profits,
license, withholding, payroll, employment, excise, transfer, recording,
severance, stamp, occupation, premium, property, environmental, custom duty, or
other tax, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest and any penalty, addition to tax or
additional amount imposed by any governmental authority responsible for the
imposition of any tax.
"Tax Indemnification Agreement" shall mean the Tax Indemnification
Agreement dated of even date herewith between CPC and Corn.
"Taxing Authority" shall mean any governmental authority responsible for
the imposition of any Tax.
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"Temporary Differences" attributable to any entity shall mean (a) any
single item of income or deduction in a CPC Return or any Foreign Distributing
Entity Return in respect of any Tax period that should reverse in one or more
subsequent Tax periods assuming proper Tax treatment and no change in law or in
the Tax accounting policies of such entity (each an "Originating Temporary
Difference") or (b) the partial or complete reversal of an Originating
Temporary Difference.
ARTICLE 2
TAX RETURN FILING
SECTION 2.01. CPC Consolidated Returns. CPC shall prepare and file with
the IRS all CPC Consolidated Returns required to be filed by CPC after the
Distribution Date. CPC shall make all decisions relating to the preparation
and filing of such returns (including, without limitation, the manner in which
any item of income, gain, loss, deduction or credit shall be reported) and
shall inform Corn of any such decisions that might materially affect a Corn
Return. CPC shall have the sole right to determine the elections that will be
made pursuant to the Code on behalf of any member of CPC Group and shall inform
Corn of any such elections that may materially affect a Corn Return. Corn
further agrees that it will, and will compel the Corn Domestic Companies to,
file or join in the filing of such authorizations, elections, consents and
other documents, and take such other actions as may be necessary or
appropriate, in the opinion of CPC, to carry out the purposes and intent of
this Section 2.01, provided that such actions are not inconsistent with this
Agreement or the Tax Indemnification Agreement. Corn shall furnish CPC at
least thirty (30) days before the due date (excluding extensions) of any such
CPC Consolidated Return all information necessary for CPC to complete the CPC
Consolidated
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Return. Any such information requested by CPC shall be consistent with current
practices and applicable law and regulations. Corn shall also furnish CPC work
papers and other such information and documentation as may be reasonably
requested by CPC with respect to the Corn Companies.
SECTION 2.02. Corn F.I.T. Returns. Corn shall prepare and file with the
IRS all Corn F.I.T. Returns required to be filed by Corn or any member of the
Corn Group (whether said returns are filed on a consolidated basis or
otherwise) for all Tax periods beginning on or after the Distribution Date
(including any short-period returns). Subject to the provisions of Section
2.15 hereof, Corn shall make all decisions relating to the preparation and
filing of such returns (including, without limitation, the manner in which any
item of income, gain, loss, deduction or credit shall be reported). Subject to
the provisions of Section 2.15 hereof, Corn shall have the right to determine
the elections that will be made pursuant to the Code on behalf of any member of
Corn Group.
SECTION 2.03. CPC State or Local Returns. CPC will prepare and file all
state and local income or franchise Tax returns and any amendments thereto
which are required to be filed by CPC after the Distribution Date and which
include the Corn Division (together with such returns filed prior to the
Distribution Date, "CPC State or Local Returns"). CPC shall make all decisions
relating to the preparation and filing of such returns, and shall inform Corn
of any such decisions that may materially affect a Corn Return. Corn shall
furnish CPC at least thirty (30) days before the due date (excluding
extensions) of any such CPC State or Local Return with a final copy of the
information necessary for CPC to complete such CPC State or Local Return.
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Corn shall also furnish CPC work papers and other such information and
documentation as may be reasonably requested by CPC.
SECTION 2.04. Corn State or Local Returns. Each Corn Domestic Company
will prepare and file all respective state and local income or franchise Tax
returns and any amendments thereto which are required to be filed by such party
after the Distribution Date, and not otherwise described in Section 2.03 above
(herein, together with such returns filed prior to the Distribution Date, "Corn
State or Local Returns"), except that CPC shall prepare all such Corn State or
Local Returns required to be filed after the Distribution Date for Tax periods
ending on or before, or beginning before and ending after, the Distribution
Date. Subject to the provisions of Section 2.15 hereof, each Corn Domestic
Company shall make all decisions relating to the preparation and filing of such
returns.
SECTION 2.05. CPC Salaried Employee Returns. CPC shall prepare and file
all employment Tax returns required to be filed by CPC after the Distribution
Date, and any amendments thereto, relating to salaried employees of CPC who
provided services directly to the Corn Division on or prior to the Distribution
Date, for all Tax periods ending on or before, or beginning before and ending
after, the Distribution Date (herein, together with such returns filed prior to
the Distribution Date, the "CPC Salaried Employee Returns"). CPC shall make
all decisions relating to the preparation and filing of such returns, and shall
inform Corn of any such decisions that may materially affect a Corn Return.
Corn shall furnish CPC at least thirty (30) days before the due date (excluding
extensions) of any such CPC Salaried Employee Return all information necessary
for CPC to complete the CPC Salaried Employee Return. Corn shall also furnish
CPC work papers and other such information and documentation as may be
reasonably
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requested by CPC with respect to the completion of any CPC Salaried Employee
Return for any Tax period or portion thereof preceding the Distribution Date.
SECTION 2.06. CPC Hourly Employee Returns. Corn, subject to the
provisions of Section 2.15 hereof, shall prepare and CPC shall file all
employment Tax returns and any amendments thereto that are required to be filed
by CPC after the Distribution Date for Tax periods ending on or before, or
beginning before and ending after, the Distribution Date relating to hourly
employees of CPC who provided services directly to the Corn Division on or
prior to the Distribution Date (herein, together with such returns filed prior
to the Distribution Date, the "CPC Hourly Employee Returns"). CPC shall have
ultimate authority to make all decisions relating to the preparation and filing
of such returns, and Corn shall comply with all such decisions of CPC relating
to the preparation of such returns. CPC shall inform Corn of any such decision
that may materially affect a Corn Return. Corn shall furnish CPC at least
thirty (30) days before the due date (including extensions) completed copies of
any such CPC Hourly Employee Returns. Corn shall also furnish CPC work papers
and other such information and documentation as may be reasonably requested by
CPC with respect to the completion of any CPC Hourly Employee Returns for any
such Tax period.
SECTION 2.07. Corn Employee Returns. Each Corn Domestic Company will
prepare and file all respective employment Tax returns and any amendments
thereto that are required to be filed by such entities after the Distribution
Date, (herein, together with such returns filed prior to the Distribution Date,
"Corn Employee Returns"), except that with respect to any Corn Employee Returns
which were prepared by CPC for periods prior to the Distribution Date. CPC
shall prepare such Corn Employee Returns due after the Distribution Date for
Tax
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periods ending on or before, or beginning before and ending after, the
Distribution Date. Subject to the provisions of Section 2.15 hereof, each Corn
Domestic Company shall make all decisions relating to the preparation and
filing of its returns.
SECTION 2.08. CPC Sales, Use and Property Tax Returns. Corn, subject to
the provisions of Section 2.15 hereof, shall prepare and CPC shall file all
sales, use and property Tax returns and any amendments thereto that are
required to be filed by CPC after the Distribution Date for all Tax periods
ending on or before, or beginning before and ending after, the Distribution
Date relating to sales, use and property Taxes levied upon property or
transactions of the Corn Division (herein, together with such returns filed
prior to the Distribution Date, the "CPC Sales, Use and Property Tax Returns").
CPC shall have ultimate authority to make all decisions relating to the
preparation and filing of such returns, and Corn shall comply with all such
decisions of CPC relating to the preparation of such returns. CPC shall inform
Corn of any such decisions that may materially affect a Corn Return. Corn
shall furnish CPC at least thirty (30) days before the due date (including
extensions) completed copies of any such CPC Sales, Use and Property Tax
Returns. Corn shall also furnish CPC work papers and other such information
and documentation as may be reasonably requested by CPC with respect to the
completion of any CPC Sales, Use and Property Tax Returns for any Tax period
preceding or including the Distribution Date.
SECTION 2.09. Corn Sales, Use and Property Tax Returns. Each Corn
Domestic Company will prepare and file all respective sales, use and property
Tax returns and any amendments thereto that are required to be filed by such
party after the Distribution Date relating to sales, use and property Taxes
levied upon such entity's property or transactions involving such
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entity's property (herein, together with such returns filed prior to the
Distribution Date, "Corn Sales, Use and Property Tax Returns"). Subject to the
provisions of Section 2.15 hereof, each Corn Domestic Company shall make all
decisions relating to the preparation and filing of its returns.
SECTION 2.10. Other CPC Returns. CPC shall prepare and file with the
applicable Taxing Authorities all other Tax returns and any amendments thereto
required to be filed by CPC after the Distribution Date with respect to the
business and operations of the Corn Division for all Tax periods ending on or
before, or beginning before and ending after, the Distribution Date and that
are not otherwise described in this Article 2 (herein, together with all such
returns filed prior to the Distribution Date, the "Other CPC Returns"), except
that Corn shall prepare, and CPC shall file, any Other CPC Return required to
be filed by CPC after the Distribution Date with respect to such Tax periods,
that, prior to the Distribution Date, had been prepared by the Corn Division.
CPC shall make all decisions relating to the preparation and filing of all such
returns, and Corn shall comply with all such decisions of CPC relating to the
preparation of such returns. CPC shall inform Corn of any such decision that
may materially affect a Corn Return. Corn shall furnish CPC at least thirty
(30) days before the due date (excluding extensions) of any such Other CPC
Return all information necessary for CPC to complete any Other CPC Returns.
Additionally, Corn will furnish completed copies of any Other CPC Return
prepared by Corn. Corn shall also furnish CPC work papers and other such
information and documentation as may be reasonably requested by CPC with
respect to the completion of any Other CPC Return for any Tax period or portion
thereof preceding the Distribution Date.
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SECTION 2.11. Other Corn Returns. Each Corn Domestic Company will
prepare and file all other Tax returns and any amendments thereto that are
required to be filed by such party after the Distribution Date that are not
otherwise described in this Article 2 (herein, together with such returns filed
prior to the Distribution Date, "Other Corn Returns"). Subject to the
provisions of Section 2.15 hereof, each Corn Domestic Company shall make all
decisions relating to the preparation and filing of such returns.
SECTION 2.12. Foreign Distributing Entity Returns. Except as otherwise
provided in an agreement between a Foreign Distributing Entity and a Foreign
Distributed Entity, the Foreign Distributing Entity will prepare and file all
foreign Tax returns and any amendments thereto which are required to be filed
by the Foreign Distributing Entity after the Applicable Foreign Distribution
Date for all Tax periods which include the operations conducted before or as of
the Applicable Foreign Distribution Date of the corn refining division of the
Foreign Distributing Entity (herein, together with such returns filed prior to
the Applicable Foreign Distribution Date, "Foreign Distributing Entity
Returns"). The Foreign Distributing Entity shall make all decisions relating
to the preparation and filing of such returns and shall inform the Foreign
Distributed Entity of any such decision that may materially affect a return
filed by such entity after the Applicable Foreign Distribution Date. The
Foreign Distributed Entity shall furnish the Foreign Distributing Entity at
least thirty (30) days before the due date (excluding extensions) of any such
Foreign Distributing Entity Return with a final copy of the information
necessary for the Foreign Distributing Entity to complete such Foreign
Distributing Entity Return. The Foreign Distributed Entity shall also furnish
the Foreign Distributing Entity
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work papers and other such information and documentation as may be reasonably
requested by the Foreign Distributing Entity.
SECTION 2.13. Corn Foreign Returns. Each foreign Corn Company will
prepare and file all respective foreign Tax returns and any amendments thereto
which are (i) not otherwise described in Section 2.12 above and (ii) with
respect to each Foreign Distributed Entity, required to be filed by such party
for all Tax periods beginning on or after the Applicable Foreign Distribution
Date or, with respect to every other foreign Corn Company, required to be filed
by such party for all Tax periods ending before, on or after the Distribution
Date ("Corn Foreign Returns"). A foreign Corn Company (other than a Foreign
Distributed Entity) may request a foreign CPC Company, if such foreign CPC
Company is better suited, to prepare the foreign Tax returns due after the
Distribution Date for any Tax periods of the foreign Corn Company that end on
or before, or begin before and end after, the Distribution Date. Subject to
the provisions of Section 2.15 hereof, the foreign Corn Company shall make all
decisions relating to the preparation and filing of all Corn Foreign Returns.
SECTION 2.14. Designation of Agent. Corn hereby irrevocably designates
CPC, and will cause each applicable Corn Company to irrevocably designate, CPC,
or, as applicable, the respective Foreign Distributing Entity, as its agent,
coordinator, and administrator for the purpose of taking any and all actions
(including the execution of waivers of applicable statutes of limitation)
necessary or incidental to the filing of (i) a CPC Return, or a Foreign
Distributing Entity Return or (ii) an amended CPC Return or Foreign
Distributing Entity Return or (iii) an amended Corn Return, filed with respect
to a Corn Return (other than a Corn Foreign Return), filed prior to the
Distribution Date, in order to make any claim for refund (even though an item
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or Tax attribute giving rise to an amended return or refund claim arises after
the Distribution Date or, as appropriate, the Applicable Foreign Distribution
Date), credit or offset of Tax or any other proceedings relating to any Tax
period or portion thereof ending prior to the Distribution Date or as
appropriate, the Applicable Foreign Distribution Date. Notwithstanding the
previous sentence, Corn shall not designate CPC as its agent with respect to
any amended CPC Return, or claim for refund, relating to any assessment of
property taxes on real property of the Corn Division for any period prior to
the Distribution Date. CPC, as agent, or when applicable, the Foreign
Distributing Entity, as agent, shall be responsible to see that all such
administrative matters relating thereto shall be handled promptly and
appropriately. CPC, or, when applicable, the Foreign Distributing Entity shall
inform and consult with Corn or the Foreign Distributed Entity prior to taking
any action on behalf of, or which will have any material impact on, any of the
Corn Companies, including, without limitation, strategies relating to waivers
of any statute of limitations.
SECTION 2.15. Post-Distribution Date Returns and Position--No
Inconsistent Positions. No Corn Company will knowingly treat any item in a
Corn Return filed by a Corn Company, or CPC Return prepared by a Corn Company
after the Distribution Date, in a manner inconsistent with the treatment of the
same item in a CPC Return, a Foreign Distributing Entity Return or any Tax
return filed by a CPC Company (including a CPC Company that will become solely
a Corn Company after the Distribution Date). CPC will inform Corn of any
changes or amendments after the Distribution Date to any CPC Return or any
Foreign Distributing Entity Return or other Tax return filed by a CPC Company
that would affect any item in a Corn Return. CPC will, or if applicable, cause
a CPC Company to, provide any assistance reasonably
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requested by a Corn Company in satisfying its obligations under this Section
2.15. If requested by Corn, CPC will review any Corn F.I.T. Return prepared by
a Corn Company with respect to its first Tax period ending after the
Distribution Date; provided that said review shall be a desk review on CPC's
premises consistent in manner and scope with the review that CPC's senior Tax
Department management performs in respect of CPC Returns. It is understood
that any such review of a Corn F.I.T. Return pursuant to this Section 2.15
would be undertaken strictly as a courtesy to Corn, and CPC shall have no
liability to Corn or any Corn Company as a result of any such review. No such
review of any Corn F.I.T. Return will waive any obligations or liabilities of
any Corn Company to CPC under this Agreement.
ARTICLE 3
TAX LIABILITY
SECTION 3.01. CPC Liability. Except to the extent otherwise provided
herein and in the Tax Indemnification Agreement, the CPC Companies shall be
liable for and indemnify Corn and each Corn Company against all costs, Taxes
and other liabilities incurred in respect of (i) all CPC Returns, (ii) all
Foreign Distributing Entity Returns, (iii) each Corn Return for which Corn or a
Corn Company, pursuant to Section 2.14, has designated CPC, as its agent in
filing an amended Corn Return, (iv) any other Tax return (other than a Corn
Return) required to be filed by CPC, a Foreign Distributing Entity or any other
CPC Company (provided that such company would not be a Corn Company following
the Distribution Date), with respect to any Tax period beginning before, on or
after the Distribution Date.
SECTION 3.02. Corn Liability. Except to the extent otherwise provided
herein and in the Tax Indemnification Agreement, the Corn Companies shall be
liable for and
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indemnify CPC and each CPC Company against (i) all costs, Taxes and other
liabilities incurred in respect of all Corn Returns other than Corn Returns for
which Corn or a Corn Company, pursuant to Section 2.14, has designated CPC as
its agent in filing an amended Corn Return (ii) notwithstanding any other
provision hereof, all costs, Taxes and other liabilities incurred by CPC or any
CPC Company as a result of a violation by Corn or any Corn Company of Section
2.15 and (iii) notwithstanding any other provision hereof, all costs, Taxes and
other liabilities incurred by CPC, Corn, any CPC Company or any Corn Company,
after the Distribution Date in respect of any assessment of property tax
referred to in Section 7.02(c)(ii) or any refund thereof referred to in Section
6.01(b).
ARTICLE 4
POST-DISTRIBUTION CARRYBACKS OF TAX BENEFITS
SECTION 4.01. Carryback Provisions. Corn shall be entitled to any refund
for any Tax obtained by CPC (or any member of the CPC Group) as a result of the
carryback of losses or credits of any member of the Corn Group from any Tax
period beginning on or after the Distribution Date to a CPC Consolidated Return
for any CPC Consolidated Return Period, provided that CPC approves in writing
such carryback. Such refund is limited to the net amount received (by refund,
offset against other Taxes or otherwise), net of any net Tax cost incurred by
CPC or a CPC Company resulting from such refund, and shall be paid whenever
payment is received from a Taxing Authority. If such approval is not granted
by CPC, Corn may elect to carryback such losses or credit in which event CPC
shall pay Corn the amount to which it would be entitled under the preceding
sentence reduced by an amount equal to any CPC Tax detriment which may be
incurred in any Tax period resulting from such carryback; provided that CPC
will
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not be obligated to make any payment to Corn in respect of any carryback that,
in the aggregate, is less than $50,000. When and if any CPC Tax detriment is
reduced, CPC shall pay the amount of such reduction to Corn. If CPC shall have
paid a refund to Corn in respect of a carryback permitted hereunder, and in a
subsequent Tax period, CPC shall suffer a Tax detriment by reason of such
carryback (that was not contemplated in the computation of the amount refunded
to Corn), Corn shall compensate CPC, on demand, for the full amount of such Tax
detriment. The application of any such carrybacks by Corn and/or any other
current or former member of the CPC Group shall be in accordance with the Code
and the consolidated return regulations promulgated thereunder. Corn shall
indemnify CPC for any costs and liabilities including interest and penalties
arising out of an audit by the IRS of the carryback of any item under this
paragraph. Upon request by Corn, CPC shall advise Corn of any estimate of the
Tax detriment it projects will be associated with any carryback of losses or
credits of a member of the Corn Group. Notwithstanding this Section 4.01, Corn
and any member of the Corn Group 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 carryback of any loss or credit to any
Tax period ending before or including the Distribution Date.
ARTICLE 5
POST-DISTRIBUTION CARRYOVERS OF TAX BENEFITS AND ATTRIBUTES
SECTION 5.01. CPC Group Items. CPC shall notify Corn as soon as
practicable after the Distribution Date of any carryover item which may be
partially or totally attributed to and carried over by a Corn Company and will
notify Corn of subsequent adjustments which may affect such carryover item.
CPC and Corn each agree to compute their respective Tax liabilities,
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and the Tax liabilities of their Affiliates, for Tax years after the
Distribution Date consistent with these determinations.
SECTION 5.02. Earnings and Profits. Based on CPC's determination, CPC
shall notify Corn as soon as practicable after the Distribution Date of the
amount of earnings and profits and associated Tax attributes, if any, which are
allocated to a Corn Company and will notify Corn of subsequent adjustments
which may affect the amount of earnings and profits and associated Tax
attributes, if any, of a Corn Company. CPC and Corn each agree to compute
their respective Tax liabilities, and the Tax liabilities of their Affiliates,
for Tax years after the Distribution Date consistent with this determination.
ARTICLE 6
ADJUSTMENTS
SECTION 6.01. CPC Returns and Foreign Distributing Entity Returns. (a)
Except as provided in the Tax Indemnification Agreement, if any Tax liability
or refund in respect of any CPC Company (or a Corn Company that prior to the
Distribution Date was a CPC Company) arises as a result of an amended filing, a
protest, an audit by the IRS or other Taxing Authority, or for any other
reason, and such Tax liability or refund relates to (i) a CPC Return filed in
respect of any Tax period commencing before or including the Distribution Date,
(ii) a Foreign Distributing Entity Return in respect of any Tax period
commencing before or including the Applicable Foreign Distribution Date, or
(iii) a Corn Return for which Corn or a Corn Company, pursuant to Section 2.14,
has designated CPC as its agent in filing an amended Corn Return, and such
liability:
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(x) does not relate to Temporary Differences attributable to a Corn
Company, then CPC or a Foreign Distributing Entity, as applicable, shall be
liable for and shall pay any Tax liabilities and any interest and penalties
associated therewith and CPC or a Foreign Distributing Entity, as applicable,
shall receive any Tax refunds and any interest associated therewith.
(y) does relate to Temporary Differences attributable to a Corn Company
and such Taxing Authority:
(i) acknowledges directly or indirectly to the satisfaction of
CPC or, as applicable, the Foreign Distributing Entity that CPC or,
as applicable, the Foreign Distributing Entity may solely utilize such
Temporary Differences in computing Tax liability, benefit or refunds in
respect of post-Distribution Date (or Applicable Foreign Distribution Date)
Tax periods, CPC or the Foreign Distributing Entity, as applicable, shall
be liable for and shall pay any such Tax liability and any interest and
penalties associated with such Tax liability and shall receive any such
benefit or refunds and any interest associated therewith; or
(ii) does not acknowledge directly or indirectly to the
satisfaction of CPC or, as applicable, the Foreign Distributing Entity
that CPC or as applicable, the Foreign Distributing Entity may solely
utilize such Temporary Differences in computing Tax liability, benefit or
refunds in respect of post-Distribution Date (or Applicable Foreign
Distribution Date) Tax periods, the party hereto against which the issue
giving rise to such Tax liability is directed shall be liable for and shall
pay any such Tax liability and any interest and penalties associated with
such Tax
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liability and shall receive any such benefit or refunds and any interest
associated therewith;
(b) Notwithstanding any other provision hereof, Corn shall be entitled
to, and shall receive, all refunds of property tax assessed on real property of
the Corn Division, provided that Corn shall be liable for and shall indemnify
and hold CPC harmless against any Tax in respect of such refunds.
SECTION 6.02. Corn Returns. Except as described in the Tax
Indemnification Agreement, if any Tax liability or refunds in respect of any
Corn Company arises as a result of an amended filing, a protest, an audit by
the IRS or other Taxing Authority, or for any other reason, and such Tax
liability or refund relates to a Corn Return other than for a Corn Return for
which Corn or a Corn Company, pursuant to Section 2.14, has designated CPC as
its agent in filing an amended Corn Return, Corn or a Corn Company shall be
liable for and shall pay any Tax liabilities and any interest and penalties
associated therewith and Corn or a Corn Company shall receive any such Tax
refunds and any interest associated therewith.
SECTION 6.03. Expenses. Any out-of-pocket expenses (e.g., travel
expenses, accountants' fees, attorneys' fees, experts' fees, etc.) incurred by
a CPC Company in connection with proposed or actual liabilities or refunds of
the type contemplated in this Article 6 shall be paid by the entities to which
such liabilities or refunds are allocated hereunder. In cases where such
expenses relate to more than one CPC Company or more than one party hereto, the
parties affected shall allocate such expenses in proportion to the amount of
proposed liabilities or refunds allocable to each, or by some other reasonable
method which results in an equitable allocation of such expenses.
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ARTICLE 7
CONTESTS
SECTION 7.01. CPC, CPC Company, and Foreign Distributing Entity Contests;
Notification and Communication. If either party, or an Affiliate of either
party, receives a notice of audit by any Taxing Authority with respect to (i)
the Corn Division with regard to any CPC Return, (ii) a Corn Company with
regard to a CPC Consolidated Return or any Corn Return for which CPC is
designated as agent, (iii) a foreign Corn Company with regard to any Foreign
Distributing Entity Return, or (iv) a Corn Foreign Return, other than a Corn
Foreign Return which is filed after the Distribution Date and in respect of
which the matter under audit would not affect a Corn Foreign Return filed prior
to the Distribution Date, such party shall promptly notify the other party of
such event. Thereafter, CPC or Corn, as the case may be, shall keep the
others, on a timely basis, informed of all material developments in connection
with audits, administrative proceedings, litigation and other similar matters
that may affect their respective Tax liabilities. Failure or delay in
providing notification hereunder shall not relieve any party hereto of any
obligation hereunder in respect of any particular Tax liability, except to the
extent that such failure or delay restricts the ability of such party to
contest such liability administratively or in the courts and otherwise
materially and adversely prejudices such party.
SECTION 7.02. Group Contests; Control and Management of Claims. (a) As
among the parties hereto, CPC shall control the prosecution of any audits and
any contests in respect of any claim made by a Taxing Authority on audit or in
a related administrative or judicial proceeding or in respect of any refund or
credit of Taxes, and shall make and prosecute other claims for refunds with
respect to any Tax liability, that relates to a CPC Return (other than
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in respect of an assessment of property taxes referred to in Section
7.02(c)(ii) or a Foreign Distributing Entity Return or any Corn Return for
which CPC is designated as an agent). Corn may participate in such audits or
contests to the extent that CPC in its sole discretion shall deem appropriate,
provided, however, that CPC shall have the sole right to control, at CPC's
expense, the prosecution of any audit, refund claim or related administrative
or judicial proceeding with respect to those matters which could affect the CPC
Group's Tax liability. CPC shall be entitled to participate in any audit not
described in this section 7.02(a) (and related contests) for which it is
entitled to receive notice under Section 7.01, including without limitation any
matter referred to in Section 7.02(c)(ii).
(b) With respect to a Tax liability or refund that, pursuant to the
provisions hereof, may be attributable to (i) the Corn Division with regard to
any CPC Return, (ii) a Corn Company with regard to a CPC Consolidated Return,
or a Corn Return for which CPC is designated as an agent, or (iii) a foreign
Corn Company with respect to any Foreign Distributing Entity Return, if CPC
elects not to exercise its rights of control under subsection (a) hereof, and
if Corn so requests, CPC shall contest, control and allow Corn to participate
to the extent that CPC in its sole discretion shall deem appropriate, all at
Corn's expense, or in the alternative shall permit Corn at its own expense to
contest and control a claim made by a Taxing Authority on audit or in a related
administrative or judicial proceeding or by appropriate claim for refund or
credit of Taxes (or to make and prosecute other claims for refund). Corn shall
pay all out-of-pocket and other costs relating to such contests, including but
not limited to fees for attorneys, accountants, expert witnesses or other
consultants.
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(c) With respect to a Tax liability or refund that, pursuant to the
provisions hereof, may be attributable to (i) Corn or a Corn Company with
regard to a Corn Return, other than a Corn Return with respect to which CPC is
designated as an agent, (ii) the Corn Division with respect to an assessment of
property tax on real property of the Corn Division for any period prior to the
Distribution Date, or (iii) a foreign Corn Company with respect to any Corn
Foreign Return, Corn, a Corn Company or a foreign Corn Company shall control at
its own expense the prosecution of any audits and any contests in respect of
any claim made by a Taxing Authority on audit or in a related administrative or
judicial proceeding or by appropriate claim for refund or credit of Taxes (or
to make and prosecute other claims for refund).
(d) If asserted liabilities unrelated to the matters contemplated
herein become grouped with contests arising hereunder, the parties shall use
their respective best efforts to cause the contest arising hereunder to be the
subject of a separate proceeding.
(e) With respect to matters arising hereunder controlled by CPC, and
where deemed necessary by CPC, Corn shall compel the relevant Corn Company to
authorize by appropriate powers of attorney such Persons as CPC shall designate
to represent such Corn Company with respect to such matters. The parties
hereto shall reasonably cooperate with one another in a timely manner with
respect to any matter arising hereunder.
ARTICLE 8
INFORMATION AND COOPERATION; BOOKS AND RECORDS
SECTION 8.01. General. (a) Corn shall deliver to CPC, as soon as
practicable after CPC's request, and CPC shall deliver to Corn as soon as
practicable after Corn's request such information and data concerning the
operations conducted by the Corn Companies or the
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CPC Companies, respectively and make available such knowledgeable employees of
the Corn Companies or the CPC Companies respectively as CPC or Corn, as the
case may be, may reasonably request, including providing the information and
data required by CPC's or Corn's customary internal Tax and accounting
procedures, in order to enable each of CPC or Corn, as the case may be, to
complete and file all Tax forms or reports that it may be required to file with
respect to the activities of the Corn Companies for Tax periods ending on,
prior to or including the Distribution Date, to respond to audits by any Taxing
Authorities with respect to such activities, to prosecute or defend any
administrative or judicial proceeding, and to otherwise enable CPC or Corn, as
the case may be, to satisfy its accounting and Tax requirements. Corn shall
provide office space to IRS and other Tax Authorities when they are conducting
on-site audits, and to employees and representatives of CPC or Corn, as the
case may be, for so long as the Tax period for which a CPC Return, a Foreign
Distributing Entity Return or a Corn Return for which CPC has been designated
as an agent, is open to assessment of additional Taxes or an assessment with
respect to such period is being contested. CPC shall deliver to Corn as soon
as practical after Corn's request, such information and data concerning any Tax
attributes which were allocated to a Corn Company that is reasonably necessary
in order to enable Corn to complete and file all Tax forms or reports that it
may be required to file with respect to such activities of the Corn Companies
from and after the Distribution Date, to respond to audits by any Tax
Authorities with respect to such activities, to prosecute or defend claims for
Taxes in any administrative or judicial proceeding, and to otherwise enable
Corn to satisfy its accounting and Tax requirements. In addition, CPC shall
make available to Corn, and Corn shall make available to CPC, its knowledgeable
employees for such purpose.
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(b) Until the expiration of the applicable statute of limitations
(including any extension or waiver thereof), each Corn Company shall retain all
books, records, documentation or other information in its possession relating
to any CPC Return, any Foreign Distributing Entity Return, and any Corn Return,
and each CPC Company shall retain all books, records, documentation or other
information in its possession relating to any Corn Return. Upon the expiration
of any statute of limitations, the foregoing information may be destroyed or
disposed of provided that (i) the party in possession of such books, records,
documentation or other information has provided sixty (60) days' prior written
notice to the other party, describing in reasonable detail the documentation to
be destroyed or disposed of and (ii) such other party has not removed or made
arrangements for removing of such materials.
ARTICLE 9
GENERAL PROVISIONS
SECTION 9.01. Effectiveness. The effectiveness of this Agreement and the
obligations and rights created hereunder are subject and conditioned upon the
completion of the Distributions.
SECTION 9.02. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by courier service (including overnight delivery), by cable, by
telecopy confirmed by return telecopy, by telegram, by telex or by registered
or certified mail (postage prepaid, return receipt requested) to the respective
parties at the addresses (or at such other address for a party as shall be
specified in a notice given in accordance with this Section 9.02) listed below:
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(a) To CPC:
P.O. Box 8000
International Plaza
Englewood Cliffs, NJ 07632
Telecopy: (201) 894-2210
Attn: Vice President-Taxes
with a copy to: General Counsel
(b) To Corn:
P.O. Box 345
6500 Archer Road
Argo, Illinois 60501
Telecopy: (708) 563-6561
Attn: Chief Financial Officer
with a copy to: General Counsel
SECTION 9.03. Complete Agreement; Construction. This Agreement is
intended to provide rights, obligations and covenants in respect of Taxes and,
together with the Tax Indemnification Agreement, shall supersede all prior
agreements and undertakings, both written and oral, between the parties with
respect to the subject matter hereof and thereof. In the event provisions of
this Agreement are inconsistent with provisions in a Tax Indemnification
Agreement, the provisions in the Tax Indemnification Agreement shall control,
except in cases where this construction would provide a duplicate benefit.
SECTION 9.04. Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
SECTION 9.05. Waiver. The parties to this Agreement may (a) extend
the time for the performance of any of the obligations or other acts of the
other party or parties, (b) waive
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any inaccuracies in the representations and warranties of the other party or
parties contained herein or in any document delivered by the other party or
parties pursuant hereto or (c) waive compliance with any of the agreements or
conditions of the other party or parties contained herein. Any such extension
or waiver shall be valid only if set forth in an instrument in writing signed
by the party to be bound thereby. Any waiver of any term or condition shall
not be construed as a waiver of any subsequent breach or a subsequent waiver of
the same term or condition, or a waiver of any other term or condition, of this
Agreement. The failure of any party to assert any of its rights hereunder
shall not constitute a waiver of any such rights.
SECTION 9.06. Amendments. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the parties
or (b) by a waiver in accordance with Section 9.05.
SECTION 9.07. Successors and Assigns. The provisions of this Agreement
shall be binding upon, inure to the benefit of and be enforceable by the
parties and their respective successors and permitted assigns. This Agreement
cannot be assigned by CPC or Corn without the consent of the other party.
SECTION 9.08. Subsidiaries. Each of the parties hereto shall cause to be
performed, and hereby guarantees the performance of, all actions, agreements
and obligations set forth herein to be performed by any subsidiary of such
party or by any entity that is contemplated to be a subsidiary of such party on
and after the Distribution Date.
SECTION 9.09. Third Party Beneficiaries. This Agreement shall be binding
upon and inure solely to the benefit of the parties hereto and their respective
subsidiaries, and nothing herein, express or implied, is intended to or shall
confer upon any third parties any legal
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or equitable right, benefit or remedy of any nature whatsoever under or by
reason of this Agreement.
SECTION 9.10. Headings. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 9.11. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or equity.
SECTION 9.12. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed in the State of New York. Without limiting
the provisions of Section 9.13 hereof, each of the parties irrevocably submits
to the exclusive jurisdiction of (a) the Superior Court of the State of New
Jersey, Bergen County, and (b) the United States District Court for the
District of New Jersey, for the purposes of any suit, action or other
proceeding arising out of this Agreement or any transaction contemplated
hereby. Each of the parties agrees to commence any action, suit or proceeding
relating hereto that is not required to be submitted to arbitration pursuant to
Section 9.13 hereof either in the United States District Court for the District
of New Jersey or if such suit, action or other proceeding may not be brought in
such court for jurisdictional reasons, in the Superior Court of the State of
New Jersey, Bergen County. Each of the parties further agrees that service of
any process, summons, notice or document by U.S. registered mail to such
party's respective address set forth above shall be effective service of
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process for any such action, suit or proceeding in New Jersey with respect to
any matters to which it has submitted to jurisdiction in this Section 9.12.
Each of the parties irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of this Agreement
or the transactions contemplated hereby in (i) the Superior Court of the State
of New Jersey, Bergen County, or (ii) the United States District Court for the
District of New Jersey, and hereby further irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such action,
suit or proceeding brought in any such court has been brought in an
inconvenient forum.
SECTION 9.13. Arbitration. Any conflict or disagreement arising out of
the interpretation, implementation, or compliance with the provisions of this
Agreement shall be finally settled pursuant to the dispute resolution
procedures set forth in the Distribution Agreement, which provisions are
incorporated herein by reference.
SECTION 9.14. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby are consummated as
originally contemplated to the greatest extent possible.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first written above by their respective officers thereunto duly
authorized.
CPC INTERNATIONAL INC.
By:
----------------------------------------
Name:
Title:
CORN PRODUCTS INTERNATIONAL, INC.
By:
----------------------------------------
Name:
Title:
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Annex
This Annex, which is an attachment to the Tax Sharing Agreement, sets
forth the agreement of the parties with respect to Taxes of CPC Rafhan Ltd.
("Rafhan"), a Pakistan corporation and Rafhan Best Foods Ltd. ("Best Foods"), a
Pakistan corporation. All capitalized terms not defined herein shall have the
meanings ascribed thereto in the Tax Sharing Agreement.
As part of a plan of reorganization, Rafhan will undergo a demerger under
Pakistan law, upon which all of the assets and liabilities of the consumer
foods business conducted by Rafhan will be transferred to Best Foods, and the
shares of Best Foods shall be distributed to the existing shareholders of
Rafhan, including CPC. In connection therewith, CPC will, as of December 31,
1997, transfer to CPI beneficial ownership of its share interest in Rafhan, as
it relates to the corn refining business conducted by Rafhan. On the date that
the demerger is effective under Pakistan law ("the Effective Date"), or as soon
as practicable thereafter, CPC will transfer to Corn legal ownership of its
shares of Rafhan pursuant to the Distribution Agreement.
The parties intend that from and after the Effective Date, the Tax
liabilities and obligations of Rafhan and Best Foods shall be as follows:
1. Rafhan shall be liable for the filing of all Tax returns and the
payment of all Taxes:
(a) with respect to all businesses conducted by Rafhan for all
periods ending on or before September 30, 1997
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(b) with respect to all businesses conducted by Rafhan, other than
the consumer foods business to be transferred to Best Foods on or before
the Effective Date, for all tax periods ending after September 30, 1997
(c) due on or before the Effective Date, which are related to the
consumer foods business conducted by Rafhan for periods beginning on or
after October 1, 1997. All Taxes due or payable with respect to such
returns shall be paid from the profits of the consumer foods business
2. Best Foods shall be liable for the filing of all Tax returns and
payment of all Taxes due after the Effective Date with respect to the
operations of the consumer foods business (whether conducted by Rafhan or
Best Foods), and all operations of Best Foods, for all Tax periods
beginning on or after October 1, 1997.
3. Rafhan shall indemnify and hold Best Foods harmless against all
Taxes referred to in paragraph 1, except as otherwise provided in
paragraph 4.
4. Best Foods shall indemnify and hold Rafhan harmless against all of
the following Taxes:
(a) all Taxes referred to in paragraph 2
(b) all Taxes referred to in section c of paragraph 1 (provided that
Rafhan shall not be entitled to reimbursement of any such Taxes paid by
Rafhan from the profits of the consumer foods business)
5. Rafhan and Best Foods, respectively, shall be entitled to file (or
cause the other party to file, as the case may be) any amended Tax returns
with respect to, control any audits or contests with respect to, and
receive any refunds of, all Taxes for which such party is liable to
indemnify and hold harmless the other party hereunder.
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6. All relevant provisions of the Tax Sharing Agreement shall apply
hereto, provided that this Annex shall control in the case of any
provision of the Tax Sharing Agreement which is inconsistent with any
provision of this Annex. Notwithstanding the previous sentence, section
2.14 of the Tax Sharing Agreement shall not apply hereto.
IN WITNESS WHEREOF, the parties have caused this Annex to be executed as
of even date with the Tax Sharing Agreement by their respective officers
thereunto duly authorized.
CPC INTERNATIONAL INC. CORN PRODUCTS INTERNATIONAL, INC.
By: By:
Its: Its:
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