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Tax Indemnity Agreement

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TAX INDEMNITY AGREEMENT

AMENDMENT TO TAX ALLOCATION AGREEMENT





This Tax Indemnity Agreement ("Agreement") is dated as of June 26, 1998, by and between Maxtor Corporation, a Delaware corporation ("Maxtor"), and Hyundai Electronics America, a California corporation ("HEA").







A. Affiliation. Maxtor became a wholly-owned subsidiary of HEA when HEA acquired all of the issued and outstanding shares of Maxtor's stock (the "Stock") during January 1996. Based on HEA's ownership of the Stock (i) Maxtor has been a member of an affiliated group (within the meaning of section 1504(a) of the Internal Revenue Code of 1986, as amended (the "Code")) of which HEA is the common parent corporation (the "Group"), and (ii) HEA has included and, prior to a Deconsolidation Date, will continue to include, Maxtor in its consolidated federal income tax returns for the period commencing during January 1996 and ending on the Deconsolidation Date (the "Affiliation Period"). For purposes of this Agreement, a "Deconsolidation Date" shall mean such date on which HEA owns less than eighty percent (80%) of the outstanding Stock, and Maxtor ceases to be a member of the Group. Maxtor anticipates that a Deconsolidation will result from a public offering of its securities.



B. Indemnification. Maxtor and HEA deem it equitable that HEA should indemnify and hold Maxtor harmless for any Taxes attributable to members of the Group other than Maxtor and Maxtor's subsidiaries (the "HEA Subgroup") and that Maxtor should indemnify and hold HEA harmless for any Taxes attributable to Maxtor and Maxtor's subsidiaries (the "Maxtor Subgroup") with respect to each taxable period during which Maxtor was a member of the Group, as further described in this Agreement.



C. Share of Consolidated Tax Liability. Upon Maxtor's becoming a member of the Group, Maxtor became a party to a Tax Allocation Agreement dated July 21, 1995, as amended (the "Tax Allocation Agreement"). Under the Tax Allocation Agreement, each member of the Group computes its share of the consolidated income tax liability on the basis of a hypothetical separate tax return computation (the "Consolidated Return Allocated Amounts") pursuant to Treasury Regulation section 1.1502-33(d)(3). HEA and Maxtor desire to amend the terms of the Tax Allocation Agreement, as set forth herein. It is the intent of the parties that by this Agreement: (i) Each party shall not be obligated to reimburse the other for such party's utilization of the other party's tax attributes with respect to an original Return or an amended Return filed on or before September 15, 1999 (the "Cut-off Date"); (ii) Maxtor shall reimburse HEA with respect to its Consolidated Return Allocated Amount, except as otherwise set forth herein; and (iii) tax attributes remaining available to each party as of the Cut-off Date shall belong to the respective party, and any future use by another party in the Group of such party's tax attributes shall be reimbursed.











NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as follows:



1. SEPARATE TAX RETURNS. If any Maxtor Subgroup member is required to pay any Taxes related to a separate Tax Return of any HEA Subgroup member, then HEA shall reimburse Maxtor for such Taxes paid. If any HEA Subgroup member is required to pay any Taxes related to a separate Tax Return of any Maxtor Subgroup member, then Maxtor shall reimburse HEA for any such Taxes paid. For purposes of this Agreement:



a. A "separate Tax Return" means any Return including items relevant for the computation of Taxes, such as income, sales or property, with respect to only members of either the Maxtor Subgroup or the HEA Subgroup;



b. A "Tax" or, collectively, "Taxes" means all federal, state, local and foreign taxes, assessments and other charges, duties, impositions and liabilities, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, value added, ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property taxes, together with all interest, penalties and additions imposed with respect to such amounts. For purposes of this Agreement; and



c. A "Return" means any federal, state, local and foreign return, estimate, information statement and report relating to any and all Taxes.



2. CONSOLIDATED OR COMBINED TAX RETURNS. Sections 8 and 9 of the Tax Allocation Agreement is amended as set forth herein. Except as otherwise set forth herein, all provisions of the Tax Allocation Agreement shall remain in full force and effect with respect to each Affiliation Period.



3. MAXTOR CONSOLIDATED RETURN ALLOCATED AMOUNT. Maxtor shall reimburse HEA for any Maxtor Consolidated Return Allocated Amount; provided, however, that if Maxtor's Consolidated Return Allocated Amount is increased as a result of any audit; examination or other proceeding (a "Proceeding") or any amended Return filed after the Cut-Off Date, Maxtor shall reimburse HEA only if such increase relates to Maxtor's items of income, gain, loss, deduction or credit. HEA agrees to take reasonable action and to act in good faith with respect to utilization of Maxtor's NOLs prior to the Cut-off Date, taking into account Maxtor's interest in having sufficient NOLs available to reduce the effect of the additional income resulting from the 1998 dividend from Maxtor's Singapore subsidiary.



4. REIMBURSEMENT FOR USE OF ANOTHER GROUP MEMBER'S TAX ATTRIBUTES PRIOR TO THE CUT-OFF DATE. Maxtor shall not be reimbursed upon Deconsolidation by the members of the Group who utilize any of the Maxtor Subgroup's tax attributes on an original filed Return or any amended Return filed on or before the Cut-Off Date. HEA shall not be reimbursed by Maxtor for





any utilization by the Maxtor Subgroup of any of the HEA Subgroup's tax attributes on an original filed Return or any amended Return filed on or b
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