Common use of Basis Adjustments Clause in Contracts

Basis Adjustments. The Parties acknowledge and agree that to the fullest extent permitted by applicable Law (i) each Redemption shall be treated as a direct purchase of Common Units by the Corporation from the applicable TRA Party pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) (i.e., equivalent to a Direct Exchange), and (ii) each (A) Exchange, (B) payment made by the Corporation (including under this Agreement, but except with respect to amounts that constitute Imputed Interest) to a TRA Party in connection with an Exchange and (C) each distribution (or deemed distribution) from Parent to a TRA Party that may reasonably be treated as a transaction between the Corporation and the TRA Party pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) will give rise to an increase or decrease to, or the Corporation’s proportionate share of, the tax basis of the Reference Assets (which are depreciable or amortizable (including assets that will eventually be subject to depreciation or amortization, once placed in service) for U.S. federal income tax purposes or stock of a corporation or land) under Section 362(a), 732, 734(b), 743(b) or 1012 of the Code (or any similar provisions of state or local tax Law) (the “Basis Adjustments”). For purposes of determining the Corporation’s proportionate share of the tax basis of the Reference Assets with respect to the Common Units transferred in an Exchange under Treasury Regulations Section 1.743-1(b) (or any similar provisions of state or local tax Law), the consideration paid by the Corporation for such Common Units shall be the Amount Realized. Notwithstanding any other provision of this Agreement, the amount of any Basis Adjustment resulting from an Exchange of one or more Common Units is to be determined as if any Pre-Exchange Transfer of such Common Units had not occurred.

Basis Adjustments. The Parties acknowledge and agree that (A) each Direct Exchange shall give rise to the fullest extent permitted by applicable Law Basis Adjustments, (iB) each Redemption using cash or Class A Common Stock contributed to the LLC by the Corporation shall be treated as a direct purchase of Common Units by the Corporation from the applicable TRA Party Member pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) (i.e., equivalent that will give rise to a Direct Exchange), and (ii) each (A) Exchange, (B) payment made by the Corporation (including under this Agreement, but except with respect to amounts that constitute Imputed Interest) to a TRA Party in connection with an Exchange Basis Adjustments and (C) each distribution (or deemed distributionSpecified Section 734(b) from Parent to a TRA Party that may reasonably be treated as a transaction between the Corporation and the TRA Party pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) will Basis Adjustment Transaction shall give rise to an increase Basis Adjustments. In connection with any Direct Exchange or decrease toRedemption, or the Parties acknowledge and agree that pursuant to applicable law the Corporation’s proportionate share of, of the tax basis of in the Reference Assets shall be increased by the excess, if any, of (which are depreciable A) the sum of (x) the Market Value of Class A Common Stock or amortizable the cash transferred to a Member pursuant to an Exchange as payment for the Units, (including assets that will eventually be subject y) the amount of payments made pursuant to depreciation or amortizationthis Agreement with respect to such Exchange and (z) the amount of liabilities allocated to the Units acquired pursuant to the Exchange, once placed in serviceover (B) for U.S. federal income tax purposes or stock of a corporation or land) under Section 362(a), 732, 734(b), 743(b) or 1012 of the Code (or any similar provisions of state or local tax Law) (the “Basis Adjustments”). For purposes of determining the Corporation’s proportionate share of the tax basis of the Reference Assets with immediately after the Exchange attributable to the Units exchanged, determined as if each member of the LLC Group remains in existence as an entity for tax purposes and no member of the LLC Group made the election provided by Section 754 of the Code. For the avoidance of doubt, payments made under this Agreement shall not be treated as resulting in a Basis Adjustment to the extent such payments are treated as Imputed Interest or are Actual Interest Amounts. With respect to the Common Units transferred in an Exchange under Treasury Regulations any Specified Section 1.743-1(b734(b) (or any similar provisions of state or local tax Law)Basis Adjustment Transaction, the consideration paid by Parties agree to work in good faith to determine the Corporation appropriate tax treatment of such transaction for such Common Units shall be the Amount Realized. Notwithstanding any U.S. federal income tax purposes, taking into account, among other provision of this Agreementthings, the amount of any Basis Adjustment resulting from an Exchange of whether one or more Common Units is Exchanges has occurred prior to be determined as if any Pre-Exchange Transfer of such Common Units had not occurredSpecified Section 734(b) Basis Adjustment Transaction.

Basis Adjustments. The Parties acknowledge and agree that to the fullest extent permitted by applicable Law (iA) each Redemption shall be treated for U.S. federal income tax purposes as a direct purchase of Common Units by the U.S. LLC (or U.S. Corporation followed by a corresponding contribution to the U.S. LLC by U.S. Corporation) from the applicable TRA Party Member pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) (i.e., equivalent to a Direct Exchange), and (ii) each (A) Exchange, (B) payment made by the Corporation (including under this Agreement, but except with respect to amounts that constitute Imputed Interest) to a TRA Party in connection with an each Exchange and (C) each distribution (or deemed distribution) from Parent to a TRA Party that may reasonably be treated as a transaction between the Corporation and the TRA Party pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) will give rise to an increase or decrease toBasis Adjustments. In connection with any Exchange, or the Parties acknowledge and agree that pursuant to applicable law U.S. Corporation’s proportionate share of, of the tax basis of in the Reference Assets shall be increased (which are depreciable or amortizable decreased) by the excess (including assets that will eventually be subject to depreciation or amortization, once placed in service) for U.S. federal income tax purposes or stock of a corporation or land) under Section 362(adeficiency), 732if any, 734(b)of (A) the sum of (x) the Market Value of Pubco Shares or the cash transferred to a Member pursuant to an Exchange as payment for the Units, 743(b(y) or 1012 the amount of payments made pursuant to this Agreement with respect to such Exchange and (z) the Code amount of liabilities allocated to the Common Units acquired pursuant to the Exchange, over (or any similar provisions of state or local tax LawB) (the “Basis Adjustments”). For purposes of determining the U.S. Corporation’s proportionate share of the tax basis of the Reference Assets with respect immediately after the Exchange attributable to the Common Units transferred exchanged, determined as if each relevant member of the U.S. LLC Group (including, for the avoidance of doubt, the U.S. LLC) remains in existence as an Exchange entity for tax purposes and no member of the U.S. LLC Group (including, for the avoidance of doubt, the U.S. LLC) made the election provided by Section 754 of the Code. For the avoidance of doubt, payments made under this Agreement shall not be treated as resulting in a Basis Adjustment to the extent such payments are treated as Imputed Interest or Default Rate Interest. Further, the Parties intend that Basis Adjustments be calculated in accordance with Treasury Regulations Section 1.743-1(b) (or any similar provisions of state or local tax Law), the consideration paid by the Corporation for such Common Units shall be the Amount Realized. Notwithstanding any other provision of this Agreement, the amount of any Basis Adjustment resulting from an Exchange of one or more Common Units is to be determined as if any Pre-Exchange Transfer of such Common Units had not occurred1.

Basis Adjustments. The Parties acknowledge and agree that to the fullest extent permitted by applicable Law (iA) each Redemption shall be treated as a direct purchase of Common Units by the Corporation from the applicable TRA Party Member pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) (i.e., equivalent to a Direct Exchange), and (ii) each (A) Exchange, (B) payment made by the Corporation (including under this Agreement, but except with respect to amounts that constitute Imputed Interest) to a TRA Party in connection with an each Exchange and (C) each distribution (or deemed distribution) from Parent to a TRA Party that may reasonably be treated as a transaction between the Corporation and the TRA Party pursuant to Section 707(a)(2)(B) of the Code (or any similar provisions of applicable state or local tax Law) will give rise to an increase or decrease toBasis Adjustments. In connection with any Exchange, or the Parties acknowledge and agree that pursuant to applicable law the Corporation’s proportionate share of, of the tax basis of in the Reference Assets shall be increased (which are depreciable or amortizable decreased) by the excess (including assets that will eventually be subject to depreciation or amortization, once placed in service) for U.S. federal income tax purposes or stock of a corporation or land) under Section 362(adeficiency), 732if any, 734(b)of (A) the sum of (x) the Market Value of Class A Common Stock or the cash transferred to a Member pursuant to an Exchange as payment for the Units, 743(b(y) or 1012 the amount of payments made pursuant to this Agreement with respect to such Exchange and (z) the Code amount of liabilities allocated to the Units acquired pursuant to the Exchange, over (or any similar provisions of state or local tax LawB) (the “Basis Adjustments”). For purposes of determining the Corporation’s proportionate share of the tax basis of the Reference Assets with respect immediately after the Exchange attributable to the Common Units transferred exchanged, determined as if each relevant member of the Switch, Ltd. Group (including, for the avoidance of doubt, Switch, Ltd.) remains in existence as an Exchange entity for tax purposes and no member of the Switch, Ltd. Group (including, for the avoidance of doubt, Switch, Ltd.) made the election provided by Section 754 of the Code. For the avoidance of doubt, payments made under this Agreement shall not be treated as resulting in a Basis Adjustment to the extent such payments are treated as Imputed Interest or Default Rate Interest. Further, the Parties intend that Basis Adjustments be calculated in accordance with Treasury Regulations Section 1.743-1(b) (or any similar provisions of state or local tax Law), the consideration paid by the Corporation for such Common Units shall be the Amount Realized. Notwithstanding any other provision of this Agreement, the amount of any Basis Adjustment resulting from an Exchange of one or more Common Units is to be determined as if any Pre-Exchange Transfer of such Common Units had not occurred1.