Apple 1997 Annual Report Download - page 143

5
the Taxes with respect to such claim are due (the "NOTICE PERIOD"). If the Company notifies you in writing prior to the expiration of the
Notice Period that it desires to contest the claim, you shall: (i) give the Company any information reasonably requested by the Company
relating to the claim; (ii) take such action in connection with the claim as the Company may reasonably request, including, without limitation,
accepting legal representation with respect to such claim by an attorney reasonably selected by the Company and reasonably acceptable to you;
(iii) cooperate with the Company in good faith in contesting the claim; and (iv) permit the Company to participate in any proceedings relating
to the claim. You shall permit the Company to control all proceedings related to the claim and, at its option, permit the Company to pursue or
forgo any and all administrative appeals, proceedings, hearings, and conferences with the taxing authority in respect of such claim. If requested
by the Company, you agree either to pay the tax claimed and sue for a refund or contest the claim in any permissible manner and to prosecute
such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts as the
Company shall determine; PROVIDED, HOWEVER, that, if the Company directs you to pay such claim and pursue a refund, the Company
shall advance the amount of such payment to you on an after-tax and interest-free basis (the "ADVANCE"). The Company's control of the
contest related to the claim shall be limited to the issues related to the Gross-Up Payment and you shall be entitled to settle or contest, as the
case may be, any other issues raised by the Internal Revenue Service or other taxing authority. If the Company does not notify you in writing
prior to the end of the Notice Period of its desire to contest the claim, the Company shall pay to you an additional Gross-Up Payment in respect
of the excess parachute payments that are the subject of the claim, and you agree to pay the amount of the Excise Tax that is the subject of the
claim to the applicable taxing authority in accordance with applicable law.
(d) REPAYMENTS. If, after receipt by you of an Advance, you become entitled to a refund with respect to the claim to which such Advance
relates, you shall pay the Company the amount of the refund (together with any interest paid or credited thereon after Taxes applicable thereto).
If, after receipt by you of an Advance, a determination is made that you shall not be entitled to any refund with respect to the claim and the
Company does not promptly notify you of its intent to contest the denial of refund, then the amount of the Advance shall not be required to be
repaid by you and the amount thereof shall offset the amount of the additional Gross-Up Payment then owing to you.
(e) FURTHER ASSURANCES. The Company shall indemnify you and hold you harmless, on an after-tax basis, from any costs, expenses,
penalties, fines, interest or other liabilities ("LOSSES") incurred by you with respect to the exercise by the Company of any of its rights under
this Section 4, including, without limitation, any Losses related to the Company's decision to contest a claim or any imputed income to you
resulting from any Advance or action taken on your behalf by the Company hereunder. The Company shall pay all legal fees and expenses
incurred under this Section 4, and shall promptly reimburse you for the reasonable expenses incurred by you in connection with any actions
taken by the Company or required to be taken by you hereunder. The Company shall also pay all of the fees and expenses of the Accounting
Firm, including, without limitation, the fees and expenses related to the opinion referred to in Section 4(b).