Common use of Contribution of the Transfer Entities Clause in Contracts

Contribution of the Transfer Entities. (a) Before the Closing, Sprint will cause the Transfer Entities to be contributed to Sprint HoldCo LLC, and Sprint HoldCo LLC will accept Capital Stock of the Transfer Entities, in each case, free and clear of any Encumbrance. Sprint will then cause Sprint HoldCo LLC to contribute the Transfer Entities to Sprint Sub LLC, and Sprint Sub LLC will accept the Capital Stock of the Transfer Entities, free and clear of any Encumbrance, and Sprint Sub LLC will issue to Sprint HoldCo LLC all of the Capital Stock of Sprint Sub LLC in accordance with the terms of the Sprint Sub LLC Agreement. The Transfer Entities will be transferred free of cash and Indebtedness (including any Encumbrances related thereto), other than the Sprint Pre-Closing Financing assumed by Sprint Sub LLC in accordance with Section 1.2(a). From and after the contributions described in this Section 3.2(a), Sprint will cause the Transfer Entities and Sprint Sub LLC to be entities disregarded as separate from Sprint HoldCo LLC for U.S. federal income tax purposes until the consummation of the transactions described in Section 3.3. (b) Sprint will (i) use its Reasonable Best Efforts to transfer, or cause to be transferred, by assignment (and not by means of merger, liquidation or any other means), prior to the Closing, all assets owned by Sprint and its Subsidiaries that are primarily used in the operation of the Sprint WiMAX Business, including the Sprint Assets, and all Liabilities that relate primarily to the Sprint WiMAX Business to one or more newly formed single member limited liability companies that are treated as disregarded entities for U.S. federal income tax purposes and (ii) with respect to those assets and Liabilities that are not assigned under clause (i), each Transfer Entity that holds any such assets and Liabilities that as of the Execution Date is not a limited liability company treated as a disregarded entity for U.S. federal income tax purposes, cause such assets and Liabilities to be held by a limited liability company that is treated as a disregarded entity for U.S. federal income tax purposes, whether through a conversion, merger, liquidation or other means (each limited liability company described in clause (i) or (ii) above, a “New Sprint LLC”). For purpose of clause (i) of the preceding sentence, Sprint will use its Reasonable Best Efforts with respect to any particular assets until the earlier of (x) the date of the receipt of the FCC Consent and (y) the date that Sprint in its reasonable judgment determines that the assignment cannot be made because it would cause Sprint to incur costs (other than de minimis amounts), including transfer Taxes, greater than those that would be incurred under clause (ii). Each New Sprint LLC will at the time of such transaction under clause (i) or (ii) be deemed to be a Transfer Entity, and each entity that no longer holds the relevant assets or Liabilities will no longer be considered a Transfer Entity, if applicable, for all purposes of this Agreement. Within five Business Days before the Closing, Sprint will provide the other Parties a revised Section 7.1(c) of the Sprint Disclosure Schedule showing the then Transfer Entities. Sprint’s obligation to use its Reasonable Best Efforts to transfer by assignment any Sprint Lease will not require Sprint to request the consent of the lessor or sublessor under any such Sprint Lease if Sprint reasonably determines such consent is necessary to effectuate such transfer by assignment, if Sprint, in its reasonable discretion, determines that seeking such consent is not in the best interests of facilitating the Transactions, would cause Sprint to incur any additional out-of-pocket costs (other than de minimis amounts), or would be reasonably likely to damage the relationship with the lessor under the Sprint Lease.