- 31 -
indemnity agreement) was entered into among the class B stock-
holders, the class C stockholders, and The Bank of New York as
trustee, and (2) a letter agreement (letter agreement) was
entered into among Amax, Amax Realty, Bemax, Cemax, Amax Securi-
ties, Mitsui Japan, and Mitsui USA.
Pursuant to the pledge and indemnity agreement, the class C
stockholders pledged their Alumax class C common stock, and, in
the event that their Alumax class C common stock were converted
into the Alumax class A common stock, their Alumax class A common
stock, to be held in trust as security for the obligation of Amax
to indemnify Alumax and the class B stockholders against certain
tax and other costs that might arise out of the 1984 restated
certificate of incorporation, the 1984 stockholders agreement,
the tax-sharing agreement, and the transactions contemplated by
any such agreements. Amax' obligation to indemnify Alumax
against certain tax and other costs as set forth in section 1 of
the pledge and indemnity agreement was as follows:
Amax shall indemnify and hold harmless Alumax in
the event that the Internal Revenue Service determines
on examination of the federal income tax liability of
the Alumax Consolidated Group [petitioners' group] or
the Combined Consolidated Group [the Amax group and
petitioners' group together] * * * for any taxable year
(an "Examination Year") that the inclusion of the
Alumax Consolidated Group in the Combined Consolidated
Group in the Examination Year or any other taxable year
was improper (an "Adverse Determination"). In the
event of an Adverse Determination, * * * [Amax] shall
repay as an indemnity to Alumax (i) the amount of any
payments made by Alumax to Amax pursuant to the Tax
Sharing Agreement with respect to the federal income
tax liability of the Alumax Consolidated Group for such
Page: Previous 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 NextLast modified: May 25, 2011