EXHIBIT 10.21 Tax Allocation Agreement ------------------------ Whereas it is the policy of Jones International, Ltd. ("JI") and its qualifying subsidiaries, presently consisting of those companies listed in Exhibit A, to file consolidated U. S....
EXHIBIT 10.21
Tax Allocation Agreement
------------------------
Whereas it is the policy of Xxxxx International, Ltd. ("JI") and its qualifying
subsidiaries, presently consisting of those companies listed in Exhibit A, to
file consolidated U. S. income tax returns and selected consolidated state
income tax returns, and whereas it is therefore desirable to provide for an
appropriate allocation of the consolidated tax liabilities (benefits) among JI
and its subsidiaries, the undersigned hereby agree that:
1. For purposes of the computation of tax liability in this Section and the
computation of tax reduction in Section (2), the taxable income or loss
of each member of the consolidated tax group in which JI owns shares
directly ("JI Subsidiary") shall first be combined with the taxable
income or loss of the subsidiaries of such JI Subsidiary. The combined
taxable income or loss of these companies shall be treated as arising
form the JI Subsidiary in the computation of tax liability and tax
reduction. The separate income or loss of the companies which are
subsidiaries of the JI Subsidiary shall not be otherwise used for
purposes of computations under this agreement. Any payments required
from or to such subsidiaries are the responsibility of the JI subsidiary
and not that of JI.
If a consolidated income tax return is filed, the income of each JI
Subsidiary with taxable income in such taxable year will be totalled and
income tax will be computed thereon. For this purpose, net operating
loss carryforwards of the JI Subsidiary shall first be utilized to
offset current year taxable income of such JI Subsidiary. Such offset
shall be prior to utilization of current year losses or net operating
losses by any other JI Subsidiary as described in Section 2 of this
Agreement. In addition, such offset shall reduce the amount of net
operating losses of such JI Subsidiary available to be utilized as
described in Section 2 of this Agreement.
If a JI Subsidiary shall generate a tax credit (or has an amount of tax
credit carryforward from prior taxable years), such credit may be
utilized to offset the amount of tax liability as computed in this
Section, but only if and to the extent that such credit can be utilized
in the current year consolidated tax return.
Each JI Subsidiary with taxable income will pay to JI an amount equal to
the tax liability computed per above as multiplied by the ratio of such
JI Subsidiary's taxable income to total taxable income as determined for
purposes of this computation. Recognition shall be given to any
component of taxable income (e.g. long-term capital gain) which would be
taxed at a different rate than other taxable income.
2. If the aggregate of the consolidated tax liability allocated to the
members of the consolidated group in Section (1) is more than the actual
consolidated tax liability, the JI Subsidiary to whom such tax reduction
is attributable shall receive credit for such tax reduction and shall
receive payment, if any, as provided by Section (5) herein. To the
extent that JI Subsidiaries generate tax attributes which cannot be
totally utilized in the current consolidated tax return or by carryback
to prior tax years (e.g. unused investment tax credit and net operating
losses), the portion of these attributes for which tax benefits are
currently realized shall be apportioned among the appropriate JI
Subsidiaries on a pro-rata basis.
3. The payments to JI, as provided in Section (1), will be made in
appropriate installments on the dates payments would be required to be
made to the appropriate taxing authorities on a consolidated basis.
4. JI will be responsible for filing all consolidated Federal income tax
returns and consolidated and/or unitary state income tax returns (where
allowed by applicable law and elected by parent), and for timely
submitting to the appropriate taxing authorities all tax payments due in
connection with such consolidated returns.
5. If the tax attributes of a JI Subsidiary generate a tax reduction as
discussed in Section (2), JI shall have the option to make a payment
equal to such tax reduction or allow the JI Subsidiary a credit against
any amounts payable to JI by such JI Subsidiary, or to defer such
payment until a subsequent taxable period in which the JI Subsidiary
generates taxable income and has a tax payment due either to JI under
the provisions of Section (3) above, or to a Federal or state taxing
authority.
Any deferred amounts will be due and payable no later than five years
from the date the deferred amount originated (90 days after the
consolidated tax return was filed). In addition, such deferred amounts
will accrue interest at Central Bank of Denver's prime rate in effect at
the time the deferred amount originates.
Once a JI Subsidiary has received credit for a tax reduction, it may not
thereafter use the tax attribute giving rise to such reduction for
purposes of any computation under the terms of this agreement.
6. In the event the consolidated tax liability is subsequently adjusted by
the Internal Revenue Service or otherwise, adjustments of tax liability,
credits and interest will be made as they affect qualifying JI
Subsidiaries.
7. The parties to this Agreement recognize that from time to time other
companies may become members of the JI consolidated group. The parties
agree that such new members may become parties to the Agreement by
executing the master copy of the Agreement maintained by JI. This
agreement shall apply only if a corporation is a member of the JI
consolidated group. Therefore, the provisions of this agreement shall
apply to new members effective with the date on which they become
members of the consolidated group. For corporations which "drop out" of
the consolidated group, the provisions of this agreement shall apply
until the date on which the corporation is no longer a member of the
consolidated group.
8. This Agreement, as may be amended from time to time, shall be applicable
to the consolidated income tax returns for the year ended May 31, 1992,
except for Section (5) paragraph (2), which shall be applicable
retroactively for fiscal years ended May 31, 1990 and May 31, 1991.
9. Failure of one or more parties hereto to continue as members of the JI
consolidated group shall not operate to terminate this Agreement with
respect to the other parties so long as two or more parties thereto
continue to so quality.
10. This agreement shall bind and inure to the respective successors and
assigns of the parties hereto, but no assignment shall relieve any
party's obligations hereunder without the written consent of all of the
other parties to this agreement.
Dated: As of August 28, 1992
Exhibit A
Company Name Parent Company FEIN Signed By
------------ -------------- ---- ---------
Xxxxx International, Ltd. N/A 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Capital Markets, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Future Foundation, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Data Transmission, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx International Securities, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Properties, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Information Management, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Banana Network, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Xxxxxx Properties, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx International Spanish Investments, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Programming Services, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Cable Ads, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Space Segment, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Earth Segment, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Galactic Sound, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Universal Robots, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx 21st Century, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx 21st Century Productions, Inc. Xxxxx 21st Century, Inc. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Entertainment Group, Ltd. Xxxxx 21st Century, Inc. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Universal Music, Inc. Xxxxx Entertainment 00-0000000 /s/ XXXX X. XXXXX
Group, Ltd. -----------------
Title
Xxxxx Education Network, Inc. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
The Mind Extension University, Inc. Xxxxx Education 00-0000000 /s/ XXXX X. XXXXX
Network, Inc. -----------------
Title
Xxxxx Satellite Holdings, Inc. The Mind Extension Applied for /s/ XXXX X. XXXXX
University, Inc. -----------------
Title
The Mind Extension Regional Network, Inc. Xxxxx Education 00-0000000 /s/ XXXX X. XXXXX
Network, Inc. -----------------
Title
The Mind Extension Institute, Inc. Xxxxx Education 00-0000000 /s/ XXXX X. XXXXX
Network, Inc. -----------------
Title
Exhibit A (cont.)
Company Name Parent Company FEIN Signed By
------------ -------------- ---- ---------
The Business Learning Group, Inc. The Mind Extension 00-0000000 /s/ XXXX X. XXXXX
Institute, Inc. -----------------
Title
Xxxxx Lightwave, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Lightwave of Atlanta, Inc. Xxxxx Lightwave, Ltd. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Lightwave of Denver, Inc. Xxxxx Lightwave, Ltd. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Lightwave of Tampa, Inc. Xxxxx Lightwave, Ltd. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Lightwave of Chicago, Inc. Xxxxx Lightwave, Ltd. 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Starsearch, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink, Ltd. Xxxxx International 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink Funds, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink Management, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Spacelink of Texas, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink of Hawaii, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink Cable Corporation Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink Spanish Investments, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Futurex, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
The Xxxxx Group, Ltd. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Galactic Radio, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Satellite Audio, Inc. Xxxxx Galactic 00-0000000 /s/ XXXX X. XXXXX
Radio, Inc. -----------------
Title
Xxxxx Galactic Radio Partners, Inc. Xxxxx Galactic 00-0000000 /s/ XXXX X. XXXXX
Radio, Inc. -----------------
Title
Xxxxx Spacelink Opportunities, Inc. Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
Xxxxx Spacelink Acquisition Corporation Xxxxx Spacelink 00-0000000 /s/ XXXX X. XXXXX
-----------------
Title
