Common use of Federal Income Tax Reporting Clause in Contracts

Federal Income Tax Reporting. (a) Subject to definitive guidance from the IRS or a court of competent jurisdiction to the contrary (including receipt by the Liquidating Trustee of a private letter ruling if the Liquidating Trustee so requests one, or the receipt of an adverse determination by the IRS upon audit if not contested by the Liquidating Trustee), the Liquidating Trustee shall file returns for the Liquidating Trust as a grantor trust pursuant to Treasury Regulation Section 1.671-4(a) and in accordance with this Article 5, which returns shall reflect all of the earnings of the Liquidating Trust, including those retained for purposes of a reserve for Disputed Claims. The Liquidating Trustee shall also annually send to each Liquidating Trust Beneficiary a separate statement setting forth such Liquidating Trust Beneficiary’s share of items of income, gain, loss, deduction, or credit and will instruct all such holders to report such items on their federal income tax returns. (b) The net fair market value, as of the Effective Date, of the Liquidating Trust Beneficiaries' interests in the Liquidating Trust, given the anticipated uses of the assets transferred to the Liquidating Trust, and the limitations in Section 6.1 hereof regarding the sources and timing of potential distributions from the Liquidating Trust, if any, shall be determined in accordance with the Plan as soon as 10 days after the Effective Date, and is anticipated to be as low as $0, reflecting the highly speculative and contingent nature of any distribution to the Liquidating Trust Beneficiaries hereunder, and such determined fair market value shall be used by the Debtors, the Liquidating Trust, the Liquidating Trustee, the Plan Advisory Committee and the Liquidating Trust Beneficiaries for all federal income tax purposes. The Liquidating Trustee shall also file (or cause to be filed) any other statements, returns or disclosures relating to the Liquidating Trust that are required by any governmental unit and pay taxes, if any, properly payable by the Liquidating Trust. (c) The Liquidating Trustee may request an expedited determination of taxes of the Liquidating Trust under section 505(b) of the Bankruptcy Code for all returns filed for, or on behalf of, the Liquidating Trust for all taxable periods through the effective date of the dissolution of the Liquidating Trust. (d) For federal income tax purposes, the Debtors, and subject to the discussion in Section 6.1 hereof, the Liquidating Trustee, and the Liquidating Trust Beneficiaries will treat the transfer of assets to the Liquidating Trustee and issuance of Liquidating Trust Interests as a deemed transfer by the Debtors of the assets to the Liquidating Trust Beneficiaries, followed by a deemed transfer of such assets by the Liquidating Trust Beneficiaries to the Liquidating Trustee in exchange for direct or indirect beneficial interests in the Liquidating Trust. (e) For federal income tax purposes, the Liquidating Trust Beneficiaries will be treated as the grantors, deemed owners and beneficiaries of the Liquidating Trust.

Federal Income Tax Reporting. (a) Subject to definitive guidance from the IRS or a court of competent jurisdiction to the contrary (including receipt by the Liquidating Litigation Trustee of a private letter ruling if the Liquidating Litigation Trustee so requests one, or the receipt of an adverse determination by the IRS upon audit if not contested by the Liquidating Litigation Trustee), the Liquidating Litigation Trustee shall file returns for the Liquidating Litigation Trust as a grantor trust pursuant to Treasury Regulation Section 1.671-4(a) and in accordance with this Article 5, which returns shall reflect all of the earnings of the Liquidating Trust, including those retained for purposes of a reserve for Disputed Claims. The Liquidating Litigation Trustee shall also annually send to each Liquidating Litigation Trust Beneficiary a separate statement setting forth such Liquidating Litigation Trust Beneficiary’s share of items of income, gain, loss, deduction, or credit and will instruct all such holders to report such items on their federal income tax returns or to forward the appropriate information to such Litigation Trust Beneficiary’s underlying beneficial owners with instructions to utilize such information in preparing their federal income tax returns. (b) The net fair market value, as of the Effective Date, of the Liquidating Trust Beneficiaries' interests in the Liquidating Trust, given the anticipated uses of the assets transferred to the Liquidating Trust, and the limitations in Section 6.1 hereof regarding the sources and timing of potential distributions from the Liquidating Trust, if any, shall be determined in accordance with the Plan as As soon as 10 days practicable after the Effective Date, but in no event later than sixty (60) days thereafter, (i) the Litigation Trustee, in consultation with the Creditors’ Committee, ESI and is anticipated to be the Debtors (or the Reorganized Debtors, as low the case may be), will determine the fair market value as $0, reflecting of the highly speculative and contingent nature Effective Date of any distribution all assets transferred to the Liquidating Trust Beneficiaries hereunderLitigation Trust, and such determined fair market value shall be used by the Reorganized Debtors, the Liquidating Litigation Trust, the Liquidating Trustee, the Plan Advisory Committee Litigation Trustee and the Liquidating Litigation Trust Beneficiaries for all tax purposes, and (ii) the Litigation Trustee shall make such valuation available from time to time to all parties to the Litigation Trust, to the extent relevant to such parties for tax purposes, and shall be used consistently by such parties for all United States federal income tax purposes. The Liquidating Litigation Trustee shall also file (or cause to be filed) any other statements, returns or disclosures relating to the Liquidating Litigation Trust that are required by any governmental unit and pay taxes, if any, properly payable by the Liquidating Litigation Trust. (c) The Liquidating Litigation Trustee may request an expedited determination of taxes of the Liquidating Litigation Trust under section 505(b) of the Bankruptcy Code for all returns filed for, or on behalf of, the Liquidating Litigation Trust for all taxable periods through the effective date of the dissolution of the Liquidating Litigation Trust. (d) For federal income tax purposes, the Reorganized Debtors, and subject to the discussion in Section 6.1 hereofESI, the Liquidating Litigation Trustee, and the Liquidating Litigation Trust Beneficiaries will treat the transfer of assets to the Liquidating Trustee Litigation Trust and issuance of Liquidating Litigation Trust Interests as a deemed transfer by the Debtors and ESI of the assets to the Liquidating Litigation Trust Beneficiaries, followed by a deemed transfer of such assets by the Liquidating Litigation Trust Beneficiaries to the Liquidating Trustee Litigation Trust in exchange for direct or indirect beneficial interests in the Liquidating Litigation Trust; provided, however, that the Litigation Trust Assets will be subject to any post-Effective Date obligations incurred by the Litigation Trust relating to the pursuit of Litigation Trust Assets. (e) For federal income tax purposes, the Liquidating Litigation Trust Beneficiaries will be treated as the grantors, deemed owners and beneficiaries of the Liquidating Litigation Trust. The foregoing treatment shall also apply to the extent permitted by applicable law, for state and local tax purposes.

Federal Income Tax Reporting. (a) Subject to definitive further guidance from the IRS or a court of competent jurisdiction to the contrary (including receipt by the Liquidating GUC Trustee of a private letter ruling if the Liquidating GUC Trustee (or Grantor) so requests one, or the receipt of an adverse determination by the IRS upon audit if not contested by the Liquidating GUC Trustee), the Liquidating GUC Trustee shall file returns for the Liquidating GUC Trust as a grantor trust pursuant to Treasury Regulation Section section 1.671-4(a) and in accordance with this Article 5, which returns shall reflect all of the earnings of the Liquidating Trust, including those retained for purposes of a reserve for Disputed Claims. The Liquidating GUC Trustee shall also annually send to each Liquidating Trust Beneficiary a separate statement setting forth such Liquidating Trust Beneficiary’s 's share of items of income, gain, loss, deduction, deduction or credit and will instruct all such holders to report such items on their federal Federal income tax returns. (b) The net fair market valueAs soon as possible after the date hereof, as but in no event later than one- hundred twenty (120) days thereafter, (i) the GUC Trust Beneficiary Committee shall inform the GUC Trustee in writing of the Effective Date, of the Liquidating Trust Beneficiaries' interests in the Liquidating Trust, given the anticipated uses value for Federal income tax purposes of the assets transferred to the Liquidating GUC Trust, based on the good faith determination of the GUC Trust Beneficiary Committee and (ii) the limitations GUC Trustee shall apprise the Beneficiaries, in Section 6.1 hereof regarding the sources and timing writing of potential distributions from the Liquidating Trust, if any, shall be determined in accordance with the Plan as soon as 10 days after the Effective Date, and is anticipated to be as low as $0, reflecting the highly speculative and contingent nature of any distribution to the Liquidating Trust Beneficiaries hereunder, and such determined fair market value valuation. The valuation shall be used consistently by all parties (including the DebtorsGrantors, the Liquidating Trust, the Liquidating Trustee, the Plan Advisory Committee GUC Trustee and the Liquidating Trust Beneficiaries Beneficiaries) for all federal Federal income tax purposes. The Liquidating GUC Trustee shall also file (or cause to be filed) any other statements, returns or disclosures relating to the Liquidating GUC Trust that are required by any governmental unit and pay taxes, if any, properly payable by the Liquidating GUC Trust. (c) The Liquidating GUC Trustee may request an expedited determination of taxes of the Liquidating GUC Trust under section Section 505(b) of the Bankruptcy Code for all returns filed for, or on behalf of, the Liquidating GUC Trust for all taxable periods through the effective date of the dissolution of the Liquidating GUC Trust. (d) For federal income tax purposes, the Debtors, and subject to the discussion in Section 6.1 hereof, the Liquidating Trustee, and the Liquidating Trust Beneficiaries will treat the transfer of assets to the Liquidating Trustee and issuance of Liquidating Trust Interests as a deemed transfer by the Debtors of the assets to the Liquidating Trust Beneficiaries, followed by a deemed transfer of such assets by the Liquidating Trust Beneficiaries to the Liquidating Trustee in exchange for direct or indirect beneficial interests in the Liquidating Trust. (e) For federal income tax purposes, the Liquidating Trust Beneficiaries will be treated as the grantors, deemed owners and beneficiaries of the Liquidating Trust.