Common use of Protective Section 336(e) Election Clause in Contracts

Protective Section 336(e) Election. (i) The Parties agree that Ironwood in its sole discretion may make, and Cyclerion will join in filing, timely protective elections under Section 336(e) of the Code and the Treasury Regulations issued thereunder, including under Treasury Regulation Sections 1.336-2(h)(1)(i) and 1.336-2(j), for each member of the Cyclerion Group that is a domestic corporation for U.S. federal Tax purposes with respect to the Distribution (a “Section 336(e) Election”). It is intended that a Section 336(e) Election will have no effect unless the Distribution is a “qualified stock disposition,” as defined in Treasury Regulation Section 1.336-1(b)(6), by reason of the application of Treasury Regulation Section 1.336-1(b)(5)(i)(B) or Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) If Ironwood determines to make a Section 336(e) Election pursuant to Section 3.5(b)(i), Ironwood and Cyclerion shall cooperate in the preparation, completion and filing of the Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions reasonably necessary to carry out the Section 336(e) Election. Ironwood shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion and its Subsidiaries, each in accordance with Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion (A) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent the Section 336(e) Election becomes effective, each Party agrees not to take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), except as may be required by a Final Determination.

Protective Section 336(e) Election. (i) The Parties agree that Ironwood bluebird in its sole discretion may make, and Cyclerion 2seventy will join in filing, timely protective elections under Section 336(e) of the Code and the Treasury Regulations issued thereunder, including under Treasury Regulation Sections 1.336-2(h)(1)(i) and 1.336-2(j), for each member of the Cyclerion 2seventy Group that is a domestic corporation for U.S. federal Tax purposes with respect to the Distribution (a “Section 336(e) Election”). It is intended that a Section 336(e) Election will have no effect unless the Distribution is a “qualified stock disposition,” as defined in Treasury Regulation Section 1.336-1(b)(6), by reason of the application of Treasury Regulation Section 1.336-1(b)(5)(i)(B) or Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) If Ironwood bluebird determines to make a Section 336(e) Election pursuant to Section 3.5(b)(i), Ironwood bluebird and Cyclerion 2seventy shall cooperate in the preparation, completion and filing of the Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions reasonably necessary to carry out the Section 336(e) Election. Ironwood bluebird shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion 2seventy and its Subsidiaries, each in accordance with Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion 2seventy (A) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent the Section 336(e) Election becomes effective, each Party agrees not to take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), except as may be required by a Final Determination.

Protective Section 336(e) Election. (i) The Parties hereby agree that Ironwood in its sole discretion may make, and Cyclerion will join in filing, to make a timely protective elections election under Section 336(e) of the Code and the Treasury Regulations issued thereunder, including under Treasury Regulation Sections 1.336-2(h)(1)(i) and Section 1.336-2(j), ) (and any similar provision of applicable state or local Tax Law) for each member of the Cyclerion Bioverativ Group that is a domestic corporation for U.S. federal Tax tax purposes with respect to the Distribution (a “Protective Section 336(e) Election”) in accordance with Treasury Regulations Section 1.336-2(h). It For the avoidance of doubt, (A) this Section 3.05(b) is intended to constitute a written, binding agreement to make the Protective Section 336(e) Election within the meaning of Treasury Regulations Section 1.336-2(h)(1)(i), and (B) it is intended that a the Protective Section 336(e) Election will have no effect unless unless, pursuant to a Final Determination, the Distribution is treated as a “qualified stock disposition,” as defined in within the meaning of Treasury Regulation Regulations Section 1.336-1(b)(6), by reason of the application of Treasury Regulation Section 1.336-1(b)(5)(i)(B) or Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) If Ironwood determines to make a Section 336(e) Election pursuant to Section 3.5(b)(i), Ironwood Biogen and Cyclerion Bioverativ shall cooperate in making the preparation, completion and filing of the Protective Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions reasonably necessary to carry out the Protective Section 336(e) Election. Ironwood Biogen shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion Bioverativ and its Subsidiaries, each in accordance with the applicable provisions of Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion Bioverativ (A) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent the Protective Section 336(e) Election becomes effective, each Party agrees not to take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Protective Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), except as may be required by a Final Determination.

Protective Section 336(e) Election. (i) The Parties agree that Ironwood in its sole discretion may make, and Cyclerion will join in filing, timely protective elections under Section 336(e) of the Code and the Treasury Regulations issued thereunder, including under Pursuant to Treasury Regulation Sections 1.336-2(h)(1)(i) and 1.336-2(j), for each member B/E and KLX agree that B/E shall have the option to make a timely protective election under Section 336(e) of the Cyclerion Group that is a domestic corporation Code and the Regulations issued thereunder for U.S. federal Tax purposes KLX and each KLX Subsidiary as identified by B/E with respect to the Distribution (a “Section 336(e) Election”). It is intended that a Section 336(e) Election will have no effect unless the Distribution is a “qualified stock disposition,” as defined in Treasury Regulation Section 1.336-1(b)(6), by reason of either because (a) the application of Distribution is not a transaction described in Treasury Regulation Section 1.336-1(b)(5)(i)(B) or (b) Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) applies to the Distribution. If Ironwood determines B/E decides to make a Section 336(e) Election pursuant to Section 3.5(b)(i)Election, Ironwood (i) B/E shall notify KLX in writing within 180 days after the Distribution Date, the Companies shall enter into a binding, written agreement and Cyclerion KLX shall cooperate with B/E in the preparation, completion and filing of making the Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions action B/E determines is reasonably necessary to carry out the Section 336(e) Election. Ironwood shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion and its Subsidiaries, each in accordance with Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion (Aii) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent if the Section 336(e) Election becomes effective, each Party agrees not to no member of the KLX Group shall take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), Election except as may be required by a Final Determination. If and to the extent that a Section 336(e) Election is made by B/E and there is a failure of one or more of the Distribution, Contribution or Debt Repayment to qualify (in whole or in part) for the Tax-Free Status, and the resulting Taxes (including any Taxes attributable to the Section 336(e) Election) are borne by B/E (rather than KLX because of KLX’s indemnification obligations under this Agreement or otherwise), then, to that extent, B/E shall be entitled to quarterly payments from KLX equal to 85 percent of the actual Tax savings if, as and when realized (using the principles of Section 6.1) arising from the step up in Tax basis resulting from the Section 336(e) Election, determined on a “with and without” basis (treating any deductions or amortization attributable to the step up in tax basis resulting from the Section 336(e) Election as the last items claimed for any taxable year, including after the utilization of any available net operating loss carryforwards), and less a reasonable charge for administrative expenses and other reasonable out-of-pocket expenses necessary to secure the Tax savings.

Protective Section 336(e) Election. (iPursuant to Treasury Regulation Sections 1.336-2(h) The Parties and 1.336-2(j), Distributing and Splitco agree that Ironwood in its sole discretion may make, and Cyclerion will join in filing, Distributing shall have the option to make (or cause to be made) a timely protective elections election under Section 336(e) of the Code and the U.S. Treasury Regulations issued thereunder, including thereunder for Communications (and any Subsidiary thereof and any election under Treasury Regulation Sections 1.336-2(h)(1)(i) and 1.336-2(j), for each member Section 754 of the Cyclerion Group that is a domestic corporation Code for U.S. federal Tax purposes any Subsidiary thereof) with respect to the Distribution PR Spin-Off (a “Section 336(e) Election”). It is intended that a Section 336(e) Election will have no effect unless the Distribution PR Spin-Off is a “qualified stock disposition,” as defined in Treasury Regulation Section 1.336-1(b)(6), by reason of either because (a) the application of PR Spin-Off is not a transaction described in Treasury Regulation Section 1.336-1(b)(5)(i)(B) or (b) Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) applies to the PR Spin-Off. If Ironwood determines Distributing decides to make a Section 336(e) Election pursuant to Section 3.5(b)(i)Election, Ironwood (i) Distributing shall notify Splitco in writing within 180 days after the Distribution Date, the Companies shall enter into a binding, written agreement and Cyclerion Splitco (and members of its Group) shall cooperate with Distributing in the preparation, completion and filing of making the Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions action Distributing determines is reasonably necessary to carry out the Section 336(e) Election. Ironwood shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion and its Subsidiaries, each in accordance with Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion (Aii) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent if the Section 336(e) Election becomes effective, each Party agrees not to no member of the Splitco Group shall take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), Election except as may be required by a Final Determination. If and to the extent that a Section 336(e) Election is made by Distributing and the PR Spin-Off fails to qualify as tax-free transactions under Section 355 of the Code (including as a result of the application of Section 355(e) of the Code), and the resulting Taxes (including any Taxes attributable to the Section 336(e) Election) are allocated to Distributing pursuant to Article II (rather than allocated Splitco under Article II together with Splitco’s indemnification obligations for such Taxes under this Agreement), then, to that extent, Distributing shall be entitled to quarterly payments from Splitco equal to 100 percent of any actual reduction in Taxes payable in cash arising from the step up in Tax basis resulting from the Section 336(e) Election, computed on a “with and without” basis, including first using any Tax Benefits of the Splitco Group regardless of the Tax Year in which the Tax Benefits arose, and less a reasonable charge for administrative expenses and other reasonable out-of-pocket expenses necessary to secure the Tax savings.

Protective Section 336(e) Election. (i) The Parties agree that Ironwood in its sole discretion may make, and Cyclerion will join in filing, timely protective elections under Section 336(e) of the Code and the Treasury Regulations issued thereunder, including under Pursuant to Treasury Regulation Sections 1.336-2(h)(1)(i) and 1.336-2(j), for each member B/E and KLX agree that B/E shall have the option to make a timely protective election under Section 336(e) of the Cyclerion Group that is a domestic corporation Code and the Regulations issued thereunder for U.S. federal Tax purposes KLX and each KLX Subsidiary as identified by B/E with respect to the Distribution (a “Section 336(e) Election”). It is intended that a Section 336(e) Election will have no effect unless the Distribution is a “qualified stock disposition,” as defined in Treasury Regulation Section 1.336-1(b)(61.336(e)-1(b)(6), by reason of either because (a) the application of Distribution is not a transaction described in Treasury Regulation Section 1.336-1(b)(5)(i)(B) or (b) Treasury Regulation Section 1.336-1(b)(5)(ii). (ii) applies to the Distribution. If Ironwood determines B/E decides to make a Section 336(e) Election pursuant to Section 3.5(b)(i)Election, Ironwood (i) B/E shall notify KLX in writing within 180 days after the Distribution Date, the Companies shall enter into a binding, written agreement and Cyclerion KLX shall cooperate with B/E in the preparation, completion and filing of making the Section 336(e) Election, including filing any statements, amending any Tax Returns or undertaking such other actions action B/E determines is reasonably necessary to carry out the Section 336(e) Election. Ironwood shall reasonably determine the “Aggregate Deemed Asset Disposition Price” and the “Adjusted Grossed-Up Basis” (each as defined under applicable Treasury Regulations) and the allocation of such Aggregate Deemed Asset Disposition Price and Adjusted Grossed-Up Basis among the disposition date assets of Cyclerion and its Subsidiaries, each in accordance with Section 336(e) of the Code and the applicable Treasury Regulations (the “Section 336(e) Allocation Statement”), and shall provide Cyclerion (Aii) a draft of such statement for its review and comment fifteen (15) Business Days prior to the due date for filing such statement and (B) a copy of such statement as filed. To the extent if the Section 336(e) Election becomes effective, each Party agrees not to no member of the KLX Group shall take any position (and to cause each of its Affiliates not to take any position) that is inconsistent with the Section 336(e) Election, including the Section 336(e) Allocation Statement, on any Tax Return, in connection with any Tax Contest or for any other Tax purposes (in each case, excluding any position taken for financial accounting purposes), Election except as may be required by a Final Determination. If and to the extent that a Section 336(e) Election is made by B/E and there is a failure of one or more of the Distribution, Contribution or Debt Repayment to qualify (in whole or in part) for the Tax-Free Status, and the resulting Taxes (including any Taxes attributable to the Section 336(e) Election) are borne by B/E (rather than KLX because of KLX’s indemnification obligations under this Agreement or otherwise), then, to that extent, B/E shall be entitled to quarterly payments from KLX equal to 85 percent of the actual Tax savings if, as and when realized (using the principle of Section 6.1) arising from the step up in Tax basis resulting from the Section 336(e) Election, determined on a “with and without” basis (treating any deductions or amortization attributable to the step up in tax basis resulting from the Section 336(e) Election as the last items claimed for any taxable year, including after the utilization of any available net operating loss carryforwards), and less a reasonable charge for administrative expenses and other reasonable out-of-pocket expenses necessary to secure the Tax savings.