ALL TAXES DUE FROM OR WITH
RESPECT TO THE ACQUIRED COMPANIES FOR ANY PRE-CLOSING TAX PERIOD, INCLUDING ANY
TAX LIABILITY THAT ARISES AS A RESULT OF THE CONVERSIONS, UNDER TREASURY
REGULATION SECTION 1.1502-6 OR ANY ANALOGOUS STATE, LOCAL OR FOREIGN LAW OR
REGULATION, OR PURSUANT TO A TAX SHARING OR INDEMNIFICATION AGREEMENT OR
ARRANGEMENT, (II) ANY TAXES ATTRIBUTABLE TO THE TRANSFER OF THE
77
INTERESTS BY QUICKSILVER TO BREITBURN PURSUANT TO THIS AGREEMENT, (III) ANY
LIABILITY FOR TAXES IMPOSED ON BREITBURN, ITS AFFILIATES (INCLUDING THE ACQUIRED
COMPANIES), OR THE DIRECT OR INDIRECT OWNERS OF THEIR RESPECTIVE EQUITY
INTERESTS AS A RESULT OF A BREACH OF THE REPRESENTATIONS SET FORTH IN SECTION
4.11, (IV) 5.5385% OF ANY AND ALL TAXES DUE FROM WCGP FOR ANY PRE-CLOSING TAX
PERIOD, AND (V) ANY LIABILITIES, COSTS, EXPENSES (INCLUDING, WITHOUT LIMITATION,
REASONABLE EXPENSES OF INVESTIGATION AND ATTORNEYS' AND ACCOUNTANTS' FEES AND
EXPENSES) ARISING OUT OF OR INCIDENT TO THE IMPOSITION, ASSESSMENT OR ASSERTION
OF ANY LIABILITIES DESCRIBED IN (I), (II), (III) OR (IV), INCLUDING THOSE
INCURRED IN THE CONTEST IN GOOD FAITH IN APPROPRIATE PROCEEDINGS RELATING TO THE
IMPOSITION, ASSESSMENT OR ASSERTION OF SUCH LIABILITIES, IN EACH CASE INCURRED
OR SUFFERED BY BREITBURN, ANY OF ITS AFFILIATES (INCLUDING THE ACQUIRED
COMPANIES) AFTER THE CLOSING DATE.
(D)
QUICKSILVER SHALL ENSURE THAT (I) ALL ITEMS
OF INCOME, GAIN, LOSS, DEDUCTION AND CREDIT ("TAX ITEMS") OF THE ACQUIRED
COMPANIES THAT ARE REQUIRED TO BE INCLUDED IN THE CONSOLIDATED FEDERAL INCOME
TAX RETURNS (AND THE STATE INCOME TAX RETURNS OF ANY STATE THAT PERMITS
CONSOLIDATED, COMBINED OR UNITARY INCOME TAX RETURNS, IF ANY) OF THE QUICKSILVER
GROUP ARE SO INCLUDED THEREIN, (II) ANY SUCH TAX RETURNS THAT INCLUDE TAX ITEMS
OF THE ACQUIRED COMPANIES ARE TIMELY FILED WITH THE APPROPRIATE TAXING
AUTHORITIES, AND (IV) ALL SUCH TAXES OWED WITH RESPECT TO SUCH TAX ITEMS
(WHETHER OR NOT SHOWN ON ANY SUCH TAX RETURN) ARE TIMELY PAID.
(E)
FOR ALL TAX RETURNS OF EACH OF THE ACQUIRED
COMPANIES COVERING PERIODS ENDING ON OR PRIOR TO THE CLOSING DATE THAT ARE FILED
AFTER THE CLOSING DATE AND ARE NOT DESCRIBED IN PARAGRAPH (D) ABOVE, BREITBURN
SHALL CAUSE SUCH TAX RETURNS TO BE PREPARED IN A MANNER CONSISTENT WITH
PRACTICES FOLLOWED IN PRIOR YEARS, EXCEPT AS OTHERWISE REQUIRED BY LAW.
BREITBURN SHALL CAUSE TO BE INCLUDED IN EACH SUCH TAX RETURN ALL TAX ITEMS
REQUIRED TO BE INCLUDED THEREIN, AND SHALL FURNISH A COPY OF EACH SUCH TAX
RETURN TO QUICKSILVER AT LEAST FIFTEEN (15) DAYS PRIOR TO THE DUE DATE
(INCLUDING EXTENSIONS) FOR FILING SUCH TAX RETURN, ALONG WITH A STATEMENT
SETTING FORTH (I) FOR THE ACQUIRED COMPANIES, THE AMOUNT OF THE TAXES SHOWN TO
BE DUE ON SUCH TAX RETURN AND (II) FOR WCGP, 5.5385% OF THE AMOUNT OF THE TAXES
SHOWN TO BE DUE ON SUCH TAX RETURN. BREITBURN SHALL PERMIT QUICKSILVER TO REVIEW
AND COMMENT ON SUCH TAX RETURNS AND SHALL MAKE SUCH REVISIONS TO SUCH TAX
RETURNS AS REASONABLY REQUESTED BY QUICKSILVER NOT LATER THAN THREE