Common use of Subpart F Clause in Contracts

Subpart F. Notwithstanding any provision of this Agreement to the contrary, to the extent the UNREGCO Consolidated Group must pay Tax attributable to a Subpart F inclusion ("Subpart F Tax") under the Code that is taken into account as a result of a Tax arising in the UNREGCO Consolidated Group Consolidated Tax Return for the taxable year that begins on the day after the Distribution Date (or in a later taxable year if there is a deficit in earnings and profits that defers such Subpart F Tax to a taxable year after the taxable year that begins on the day after the Distribution Date), REI (or its successor REGCO) shall pay to UNREGCO a percentage of the Subpart F Tax equal to the percentage of days of the 12-month Tax period to which such Subpart F Tax relates based on the number of days in such 12-month Tax period before the Distribution Date bears to the total days in such 12-month Tax period that includes the Distribution Date, but only to the extent that the Subpart F Tax issue relates to an income inclusion that is attributable to an item that accrued ratably (utilizing principles similar to those of the ratable allocation election of Treasury Regulation Section 1.1502-76(b)(2)(ii)(D), adjusting for extraordinary items similar to those set forth in Treasury Regulation Section 1.1502-76(b)(2)(ii)(C)) over the 12-month Tax period. Within 15 days after the filing of the Tax Return for the taxable year that begins on the day after the Distribution Date (or such later taxable year if there is a deficit in earnings and profits that defers such Subpart F Tax to a taxable year after the taxable year that begins on the day after the Distribution Date), UNREGCO shall notify REI (or its successor REGCO) in writing as to the amount of payment, if any, REI (or its successor REGCO) owes to UNREGCO under the preceding sentence. REI (or its successor REGCO) shall pay UNREGCO such amount within 15 days of receiving such notice. If REI (or its successor REGCO) disagrees with such amount, REI (or its successor REGCO) may invoke the resolution procedures of Section 8.3.