FairPoint Communications 2005 Annual Report Download - page 194

affect rights to indemnification hereunder, except to the extent that the Shareholders are actually prejudiced by such failure. The Shareholders shall promptly
give written notice to Buyer of any written or other notification received by the Shareholders from a Taxing authority of a proposed adjustment with respect to
any Tax of SICC or its Affiliates which is attributable to Tax periods ending on or before the Closing Date and shall also promptly give written notice to Buyer
if a Taxing authority threatens to assert against SICC or Buyer the Tax Liability of any others (including, but not limited to, the Shareholders). The
Shareholders shall have the right to control, contest and defend at its sole cost and expense and with counsel reasonably acceptable to the Buyer. Buyer shall
reasonably cooperate with respect to the portion of any claim, action or proceeding with respect to any Tax for which the Shareholders are responsible at the
sole cost and expense of the Shareholders. The Shareholders jointly and severally agree to pay to Buyer and SICC all of their reasonable expenses which they
shall incur in connection with such cooperation. The Shareholders shall keep Buyer reasonably informed of the progress of any such claim, action or
proceeding and shall allow Buyer’s reasonable participation therein at Buyer’s expense. The Shareholders may not settle any such claim, action or proceeding
in a manner which would materially adversely affect SICC or its Affiliates after the Closing Date unless the Shareholders obtain the prior written consent of
Buyer, which consent shall not unreasonably be withheld. Buyer may request that the Shareholders decline to take any further action with respect to any
claim, demand or deficiency described herein, and the Shareholders thereafter shall take no further action provided that Buyer has notified the Shareholders in
writing that it waives its right to indemnification for any liability resulting therefrom. In the event the Shareholders request SICC to pay Taxes to a
Governmental Authority prior to contesting the assessment thereof and thereafter to file a claim or suit for refund, the Shareholders shall advance to SICC, on
an interest-free basis, the amount of any such payment, after which SICC shall promptly pay the amount to the Governmental Authority as directed by the
Shareholders.
(f) Resolution of Disagreements. If Buyer and the Shareholders disagree as to the amount of Taxes for which each is liable under this
Agreement or the amount of any Tax Shortfall, Buyer and the Shareholders shall promptly consult each other in an effort to resolve such dispute. If any such
dispute cannot be resolved within 60 calendar days of the initial date of consultation, Buyer and the Shareholders shall within ten (10) calendar days after
such 60-day period submit such dispute to resolution in accordance with Section 12.11; provided, that the arbitrators so selected pursuant to such provision
shall also be certified public accountants licensed or tax lawyers from a nationally recognized law firm and practicing in Illinois.
(g) Tax Elections. No new elections with respect to Taxes or any changes in current elections with respect to Taxes affecting SICC or its
Affiliates shall be made by SICC, its Affiliates or the Shareholders after the date of this Agreement without the prior written consent of Buyer which consent
shall not be unreasonably withheld. SICC and its Affiliates will forward any material Tax elections affecting such entities to the Buyer prior to Closing.
(h) Transfer Taxes. Shareholders shall pay and be jointly and severally liable for any sales, use, transfer and documentary Taxes and similar
recording and filing fees applicable to the transfer of the Shares to Buyer at Closing under the laws of the State of Illinois or North Carolina.
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