TO THE AMOUNT OF SUCH PROPERTY TAXES FOR THE ENTIRE
STRADDLE PERIOD MULTIPLIED BY A FRACTION, THE NUMERATOR OF WHICH IS THE NUMBER
OF DAYS DURING THE STRADDLE PERIOD THAT ARE IN THE PRE-CLOSING TAX PERIOD AND
THE DENOMINATOR OF WHICH IS THE NUMBER OF DAYS IN THE STRADDLE PERIOD; AND
(II) THE TAXES OF THE COMPANY AND ITS SUBSIDIARIES (OTHER THAN PROPERTY TAXES)
FOR THE PORTION OF THE STRADDLE PERIOD THAT CONSTITUTES A PRE-CLOSING TAX PERIOD
SHALL BE COMPUTED AS IF SUCH TAXABLE PERIOD ENDED AS OF THE CLOSE OF BUSINESS ON
THE CLOSING DATE.
IF NECESSARY BECAUSE THE ASSETS WERE REPORTED TO THE TAX
AUTHORITIES ON A COMBINED BASIS (I.E., CLOSING OCCURS ON OR BEFORE DECEMBER 31,
2005), THE
47
PROPERTY TAXES SHALL BE ALLOCATED BY THE BUYER BETWEEN THE ASSETS ACQUIRED IN
THIS TRANSACTION AND THE BUYER'S REMAINING ASSETS IN ACCORDANCE WITH THE BUYER'S
REASONABLE ASSET ALLOCATION PRACTICE.
IF THE BUYER'S ALLOCATION IS DISPUTED BY
THE SELLER, THEN THE SELLER AND THE BUYER SHALL NEGOTIATE IN GOOD FAITH TO
RESOLVE SUCH DISPUTE.
(E)
IF A TAX AUTHORITY COMMENCES ANY AUDIT,
EXAMINATION, LITIGATION OR OTHERWISE MAKES ANY CLAIM OR PROPOSES ANY ADJUSTMENT
THAT RELATES TO A PRE-CLOSING TAX PERIOD (OTHER THAN AN STRADDLE PERIOD)
(COLLECTIVELY, A "TAX PROCEEDING"), THEN THE BUYER SHALL PROMPTLY FURNISH
WRITTEN NOTICE TO THE SELLER OF SUCH TAX PROCEEDING.
FAILURE TO GIVE SUCH
NOTICE SHALL NOT RELIEVE THE SELLER FROM ANY LIABILITY WHICH IT MAY HAVE ON
ACCOUNT OF THIS INDEMNIFICATION OR OTHERWISE, EXCEPT TO THE EXTENT THAT THE
SELLER IS PREJUDICED THEREBY.
THE SELLER SHALL HAVE THE SHORTER OF (I) 45 DAYS
AFTER RECEIPT OF SUCH NOTICE OR (II) 15 DAYS LESS THAN THE NUMBER OF DAYS BEFORE
A RESPONSE TO THE RELEVANT TAX AUTHORITY IS REQUIRED, BUT IN NO EVENT SHALL THE
SELLER HAVE LESS THAN 15 DAYS, TO DECIDE WHETHER TO UNDERTAKE, CONDUCT AND
CONTROL (THROUGH COUNSEL OF ITS OWN CHOOSING AND AT ITS OWN EXPENSE) THE
RESPONSE TO SUCH TAX PROCEEDING AND THE SETTLEMENT OR DEFENSE THEREOF, AND THE
BUYER SHALL FULLY COOPERATE WITH SELLER IN CONNECTION THEREWITH INCLUDING, BUT
NOT LIMITED TO, PROVIDING POWERS OF ATTORNEY AUTHORIZING LEUCADIA (OR ITS
DESIGNEE) TO CONTROL AND TAKE ACTION IN CONNECTION WITH ANY SUCH TAXES.
THE
SELLER SHALL PERMIT THE BUYER TO PARTICIPATE IN SUCH RESPONSE, SETTLEMENT OR
DEFENSE THROUGH COUNSEL CHOSEN BY THE BUYER (BUT THE FEES AND EXPENSES OF SUCH
COUNSEL SHALL BE PAID BY BUYER).
IF ANY SETTLEMENT MATERIALLY ADVERSELY AFFECTS
ANY SUBSIDIARY IN A POST-CLOSING TAX PERIOD, THE SELLER SHALL NOT PAY OR SETTLE
ANY SUCH CLAIM WITHOUT THE PRIOR WRITTEN CONSENT OF BUYER (WHICH CONSENT SHALL
NOT BE UNREASONABLY WITHHELD, CONDITIONED OR DELAYED).
IF WITHIN THE SHORTER OF
(X) 45 DAYS AFTER THE RECEIPT OF THE BUYER'S NOTICE OF A TAX PROCEEDING OR (Y)
20 DAYS LESS THAN THE NUMBER OF DAYS BEFORE A RESPONSE TO THE RELEVANT TAX
AUTHORITY IS REQUIRED (BUT IN NO EVENT LESS THAN 20 DAYS), THE SELLER DOES NOT
NOTIFY THE