CHAPTER FIVE .................................................................................................................. 58 THE TAX COVENANT .................................................................................................... 58 Executive Summary ......................................................................................................... 58 1 Definitions and Interpretation................................................................................... 59 2 Covenants ............................................................................................................... 63 3 Exclusions ............................................................................................................... 64 4 Due Date for Payment ............................................................................................. 67 5 Deduction from Payments ....................................................................................... 68 6 Claims ... ................................................................ …………………………………...68 7 Recoveries .............................................................................................................. 70 8 Overprovisions, Understatements, Sellers Relief and Corresponding Savings ........ 71 9 Tax Returns............................................................................................................. 71 10 Counter Covenant ................................................................................................... 73 11 General ................................................................................................................. 73 CHAPTER SIX .................................................................................................................... 74 THE RELEVANT ACCOUNTS AND THEIR TAX PROVISIONS ..................................... 74 Executive Summary ......................................................................................................... 74 1 Introduction ............................................................................................................. 75 2 The Issue: the “Pivot Point” .................................................................................... 76 3 The Solution ............................................................................................................ 76 4 The Status of Tax Provisions in The Relevant Accounts.......................................... 77 5 The Period Between the Last Accounts Date and Completion................................. 80 CHAPTER SEVEN ............................................................................................................. 82 THE PARTIES TO THE TAX COVENANT ...................................................................... 82 Executive Summary ......................................................................................................... 83 1 Introduction ............................................................................................................. 84 2 The Current Position................................................................................................ 86 3 Tax Position of the Seller......................................................................................... 87 4 Tax Position of the Buyer ........................................................................................ 89 5 Relationships Between Sellers ................................................................................ 89 CHAPTER EIGHT ............................................................................................................... 90 DEFINITIONS ................................................................................................................. 90 Executive Summary ......................................................................................................... 91 1 Introduction ............................................................................................................. 92 2 Buyer’s Relief .......................................................................................................... 92 3 Corresponding Saving ............................................................................................. 99 4 “Event” ............................................................................................................... 102 5 “IHT Liability” ......................................................................................................... 104 6 “Overprovision”...................................................................................................... 105 7 “Recovery”............................................................................................................. 106 8 “Relief” ............................................................................................................... 107 9 “Sellers’ Relief” ...................................................................................................... 109 10 “Tax” or “Taxation”................................................................................................. 110
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