TAX RECEIVABLE AGREEMENT
 
 
 
(this "Agreement"), dated as of
 , 2004, by and among XXX,
 Inc., a Delaware corporation ("XXX") and YYY, Inc., 
a Washington subchapter S corporation ("YYY II").
 
 
 
  WHEREAS, on , 2004, DW Investment I, Inc., a subchapter S
corporation ("YYY I"), distributed its entire interest in XXX
LLC, a Delaware limited liability company ("XXX LLC"), to ...... .. ......
("......"), its sole shareholder, in a transaction taxable under Section 311 of
the Code (the "...... Transaction").
 
 
 
 
 
 
 
 
 

 WHEREAS, on , 2004, after the ...... Transaction, ......
contributed his entire interest in XXX LLC to YYY II and XXX acquired such
interest in XXX LLC from YYY II by contribution (the "Contribution") in a
transaction described in Section 351 of the Internal Revenue Code of 1986, as
amended (the "Code").
 
 
 

IL DOCUMENTO È INCOMPLETO, A RICHIESTA SARÀ INVIATA UNA COPIA COMPLETA (artt.17 ss Cod.Deont.)

STUDIO

MISURACA & Associati/Associates

Studio Legale

Law Firm

www.smaf-legal.com

Il documento manca di molte parti, lo studio legale SMAF invia su gentile richiesta una completa copia a titolo di prestazione professionale a pagamento ex artt.17 ss. Cod. Deont. Forense / The document has missing parts; please, consider SMAF law firm allowed to send a you a payable copy according to Italian Forensic Deontology Code.

20123 MILANO (MI), Italia

Via Monti, 8

tel.:   +(39) 02 006 15 017  

fax:   +(39) 02 700 50 81 00

e-mail: info@smaf-legal.com

00198 ROMA (RM), Italia

Via Savoia, 78

tel.:  +39 06 92 938 008

cell.: +39 06 8928 10 51

e-mail: info@smaf-legal.com

40123 BOLOGNA (BO), Italia

Via Urbana 5/3

tel.:    +(39) 051 64 40 543

fax.:   +(39) 051 09 52 565

2°fax: +(39) 051 33 70 177

e-mail: misuraca@smaf-legal.com

 WHEREAS, this Agreement was issued by XXX to YYY II as partial
consideration for the XXX LLC interest transferred to XXX by YYY II in the
Contribution and shall be treated as "other property" received by YYY II for
purposes of Section 351(b) of the Code.
 
 WHEREAS, XXX LLC shall have in effect an election under Section 754
of the Code(2) for the Taxable Year in which the ...... Transaction occurs,
which will result in an adjustment to the tax basis of the assets owned by XXX
LLC as of the Closing Date (such assets and any asset whose tax basis is
determined, in whole or in part, by reference to the adjusted basis of any such
asset, the "Original Assets") by reason of the ...... Transaction and the
issuance of this Agreement to YYY II as partial consideration in the
Contribution.
 
 
 WHEREAS, on , 2004, XXX acquired all the remaining interests
in XXX LLC from the holders of such interests, other than an interest in XXX LLC
held by DreamWorks, Inc., a Delaware corporation ("DW Inc.").
 
 
 
 WHEREAS, on , 2004, after the ...... Transaction, XXX
acquired all the outstanding stock of DW Inc.
 
 
 WHEREAS, XXX is the common parent of the XXX Affiliated Group and DW
Inc. is a member of the XXX Affiliated Group.
 
 WHEREAS, 100% of the interests in XXX LLC are held by members of the
XXX Affiliated Group and, as a result, the income, gain, loss, expense and other
Tax items of XXX LLC will be reported by the XXX Affiliated Group on the XXX
Consolidated Returns.
 
 
 
 
 
<PAGE>
 2
 
 
 WHEREAS, the income, gain, loss, expense and other Tax items of XXX
LLC may be affected by the Basis Adjustment and the Imputed Interest.
 
 WHEREAS, the parties to this Agreement desire to make certain
arrangements with respect to the effect of the Basis Adjustment and Imputed
Interest on the actual liability for Covered Taxes of the XXX Affiliated Group.
 
 NOW, THEREFORE, in consideration of the foregoing and the respective
covenants and agreements set forth herein, and intending to be legally bound
hereby, the parties hereto agree as follows:
 
  ARTICLE I
 Definitions
 
 Definitions. As used in this Agreement, the terms set forth in this
Article I shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined).
 
 
 "Advisory Firm" means [ ] or a nationally recognized accounting
or law firm that is nationally recognized as being expert in Covered Tax matters
that is agreed to by XXX and YYY II as its replacement.
 
 
 "Advisory Firm Letter" shall mean a letter from the Advisory Firm
stating that the relevant schedule, notice or other information to be provided
by XXX to YYY II and all supporting schedules and work papers were prepared in a
manner consistent with the terms of this Agreement and, to the extent not
expressly provided in this Agreement, on a reasonable basis in light of the
facts and law in existence on the date such schedule, notice or other
information is delivered to YYY II.
 
 "Agreed Rate" means, LIBOR plus 200 basis points.
 
 "Agreement" is defined in the preamble.
 
 "Agreement Value" is defined in Section 2.01 of this Agreement.
 
 "Amended Tax Benefit Schedule" is defined in Section 2.03(b) of this
Agreement.
 
 
 "Applicable Treasury Rate" means a rate equal to (1) if an Early
Termination Notice is delivered prior to the third anniversary of the Closing
Date , [x.xx]% or (2) the yield to maturity as of the date an Early
Termination Notice is delivered of United States Treasury
 
 
 
 
 
 
 
<PAGE>
 3
 
 
securities with a constant maturity (the "Applicable Maturity") (as compiled and
published in the most recent Federal Reserve Statistical Release H 15 (519))
equal to (a) if such Early Termination Notice is delivered on or after the third
anniversary of the Closing Date but prior to the fifth anniversary of the
Closing Date, 10 years, (b) if such Early Termination Notice is delivered on or
after the fifth anniversary of the Closing Date but prior to the fifteenth
anniversary of the Closing Date, the number of years from the date such Early
Termination Notice is delivered through the fifteenth anniversary of the Closing
Date, or (c) if such Early Termination Notice is delivered on or after the
fifteenth anniversary of the Closing Date, two years. If there are no United
States Treasury securities with a constant maturity equal to the Applicable
Maturity, the yield to maturity shall be interpolated from the United States
Treasury securities with constant maturities that are most nearly longer than
and shorter than the Applicable Maturity.
 
 "Basis Adjustment" means the increase or decrease to the tax basis
of an Original Asset (i) under Sections 743(b) and 754 of the Code and
comparable sections of the California Revenue and Taxation Code as a result of
the ...... Transaction and (ii) under Section 362(a) of the Code and the
comparable section of the California Revenue and Taxation Code as a result of
the receipt by YYY II of this Agreement as partial consideration in the
Contribution, as shown on the Basis and Agreement Value Schedule. The Basis
Adjustment shall include only the increase or decrease to the tax basis of any
Original Asset made as of the Closing Date and for the reasons described in (i)
and (ii) above, provided however that if there is a relevant Determination that
all or part of the Basis Adjustment described in (ii) above occurred after the
Closing Date by reason of the accrual or payment of any amount due to YYY II
under this Agreement, then the increase or decrease in the basis of the Original
Assets described in (ii) above shall include all such adjustments as they occur
after the Closing Date in a manner consistent with such Determination.
 
 "Basis and Agreement Value Schedule" is defined in Section 2.02(a)
of this Agreement.
 
  "Business Day" means any calendar day that is not a Saturday, Sunday
or other calendar day on which banks are required or authorized to be closed in
the City of New York.
 
 "California State Income Tax" means any income, franchise or similar
tax imposed by the state of California (including, without limitation, the
Corporation Tax Law under the California Revenue and Taxation Code Section 23001
et. seq.), and any interest, additions to tax or penalties applicable or related
to such tax.
 
 
 "Change of Control Event" means the occurrence of any of the
following events, not including any events occurring prior to or in connection
with an initial public offering of Shares (as defined below), including the
occurrence of such initial public offering:
 
 
 (i) during any period of 14 consecutive calendar months, individuals
 who were directors of XXX on the first day of such period (the "Incumbent
 Directors") cease for any reason to constitute a majority of the Board of
 Directors of XXX (the "Board"); provided, however, that any individual
 becoming a director subsequent to the first day of
 
<PAGE>
 4
 
 
 such period whose election, or nomination for election, by XXX's
 stockholders was approved by a vote of at least a majority of the
 Incumbent Directors shall be considered as though such individual were an
 Incumbent Director, but excluding, for purposes of this proviso, any such
 individual whose initial assumption of office occurs as a result of an
 actual or threatened proxy contest with respect to election or removal of
 directors or other actual or threatened solicitation of proxies or
 consents by or on behalf of a "person" (as such term is used in Section
 13(d) of the Exchange Act), in each case other than the management of XXX,
 the Board or the holders of XXX's Class B common stock, $0.01 par value;
 
  (ii) the consummation of (A) a merger, consolidation, statutory
 share exchange or similar form of corporate transaction involving (x) XXX
 or (y) any of its Subsidiaries, but in the case of this clause (y) only if
 XXX Voting Securities (as defined below) are issued or issuable (each of
 the events referred to in this clause (A) being hereinafter referred to as
 a "Reorganization") or (B) the sale or other disposition of all or
 substantially all the assets of XXX to an entity that is not an affiliate
 of XXX (a "Sale") if such Reorganization or Sale requires the approval of
 XXX's stockholders under the law of XXX's jurisdiction of organization
 (whether such approval is required for such Reorganization or Sale or for
 the issuance of securities of XXX in such Reorganization or Sale), unless,
 immediately following such Reorganization or Sale, (1) all or
 substantially all the individuals and entities who were the "beneficial
 owners" (as such term is defined in Rule 13d-3 under the Exchange Act (or
 a successor rule thereto)) of the shares of Class A Common Stock of XXX,
 $0.01 par value, or such other securities of XXX into which such shares
 shall be changed by reason of a recapitalization, merger, consolidation,
 split-up, combination, exchange of shares or other similar transaction
 (the "Shares") or other securities eligible to vote for the election of
 the Board (together, "XXX Voting Securities") outstanding immediately
 prior to the consummation of such Reorganization or Sale beneficially own,
 directly or indirectly, more than 50% of the combined voting power of the
 then outstanding voting securities of the corporation resulting from such
 Reorganization or Sale (including, without limitation, a corporation that
 as a result of such transaction owns XXX or all or substantially all XXX's
 assets either directly or through one or more subsidiaries) (the
 "Continuing Corporation") in substantially the same proportions as their
 ownership, immediately prior to the consummation of such Reorganization or
 Sale, of the outstanding XXX Voting Securities (excluding any outstanding
 voting securities of the Continuing Corporation that such beneficial
 owners hold immediately following the consummation of the Reorganization
 or Sale as a result of their ownership prior to such consummation of
 voting securities of any company or other entity involved in or forming
 part of such Reorganization or Sale other than XXX), (2) no "person" (as
 such term is used in Section 13(d) of the Exchange Act), excluding (x) any
 employee benefit plan (or related trust) sponsored or maintained by the
 Continuing Corporation or any corporation controlled by the Continuing
 Corporation, (y) Jeffrey Katzenberg and (z) David Geffen, beneficially
 owns, directly or indirectly, 20% or more of the combined voting power of
 the then outstanding voting securities of the Continuing Corporation and
 (3) at least a majority of the members of the board of directors of the
 Continuing Corporation were Incumbent Directors at the time of the
 execution of the definitive agreement providing for such
<PAGE>
 5
 
 
 Reorganization or Sale or, in the absence of such an agreement, at the
 time at which approval of the Board was obtained for such Reorganization
 or Sale;
 
 (iii) the stockholders of XXX approve a plan of complete liquidation
 or dissolution of XXX; or
 
 
 (iv) any "person" (as such term is used in Section 13(d) of the
  Exchange Act), corporation or other entity or "group" (as used in Section
 14(d)(2) of the Exchange Act) (other than (A) XXX, (B) any trustee or
 other fiduciary holding securities under an employee benefit plan of XXX
 or an affiliate of XXX or (C) any company owned, directly or indirectly,
 by the stockholders of XXX in substantially the same proportions as their
 ownership of the voting power of the XXX Voting Securities) becomes the
 beneficial owner, directly or indirectly, of securities of XXX
 representing 20% or more of the combined voting power of the XXX Voting
 Securities but only if the percentage so owned exceeds the aggregate
 percentage of the combined voting power of the XXX Voting Securities then
 owned, directly or indirectly, by Jeffrey Katzenberg and David Geffen;
 provided, however, that for purposes of this subparagraph (iv), the
 following acquisitions shall not constitute a Change of Control: (x) any
 acquisition directly from XXX or (y) any acquisition by any employee
 benefit plan (or related trust) sponsored or maintained by XXX or an
 affiliate of XXX.
 
 
 "Change of Control Termination Payment" is defined in Section
4.03(c) of this Agreement.
 
 
 "Closing Date" means , 2004.
 
 
 "Code" is defined in the recitals.
 
 "Contribution" is defined in the recitals.
 
 "Covered Taxable Year" means any Taxable Year of the XXX Affiliated
Group ending after the Closing Date and on or before the end of the Taxable Year
including the date which is the twentieth (20th) anniversary of the Closing
Date.
 
 "Covered Taxes" means Federal Income Taxes and California State
Income Taxes.
 
 "Determination" shall have the meaning ascribed to such term in
Section 1313(a) of the Code or similar provision of the California Revenue and
Taxation Code, as applicable.
 
 "XXX" is defined in the preamble.
 
 
 
 
<PAGE>
  6
 
 
 "XXX Affiliated Group" means the affiliated group of domestic
corporations within the meaning of Section 1504(a) of the Code or the unitary
combined group of corporations within the meaning the California Revenue and
Taxation Code, as applicable, of which XXX is a member from time to time.
 
 "XXX Consolidated Return" means the consolidated Federal income tax
return or California unitary combined tax return, as applicable, of the XXX
Affiliated Group filed with respect to any Taxable Year.
 
 "XXX Group" means (i) the corporations that are members of the XXX
Affiliated Group and (ii) the corporations that would be members of the XXX
Affiliated Group but for the fact they are not includible corporations under
Section 1504(b) of the Code.
 
 "XXX Payment" is defined in Section 5.01 of this Agreement.
 
 "XXX LLC" is defined in the recitals.
 
 
 "XXX Senior Obligations" means indebtedness of XXX (including and
together with all monetary obligations in respect of the five-year $200 million
revolving credit facility entered into among XXX, JP Morgan Chase Bank and
certain other lenders (the "Credit Agreement"), and interest, whether or not
allowable, accruing on indebtedness incurred pursuant to the Credit Agreement
after the filing of a petition initiating any proceeding under any bankruptcy,
insolvency or similar law or that would have accrued but for such filing)
arising under the Credit Agreement or that, by the terms of the instrument
creating or evidencing such indebtedness, is expressly designated "senior debt"
and made senior in right of payment to any other of the indebtedness of XXX;
provided, that in no event shall XXX Senior Obligations include (i) indebtedness
to any Subsidiary of XXX or any officer, director or employee of XXX or any of
its Subsidiaries (other than indebtedness that is required to be pledged to the
lenders under the Credit Agreement) or (ii) indebtedness to trade creditors.
 
 
 "YYY I" is defined in the recitals.
 
 "YYY II" is defined in the preamble.
 
 "DW Inc." is defined in the recitals.
 
 "DW LLC" means DreamWorks L.L.C., a Delaware limited liability
company.
 
  "Early Termination Notice" is defined in Section 4.02 of this
Agreement.
 
 "Early Termination Payment" is defined in Section 4.03(b) of this
Agreement.
 
 
 
 
<PAGE>
  7
 
 
 "Early Termination Rate" means the Applicable Treasury Rate plus 300
basis points.
 
 "Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute thereto.
 
 "Federal Income Tax" means any tax imposed under Subtitle A of the
Code or any other provision of United States Federal income tax law (including,
without limitation, the taxes imposed by Sections 11, 55, 59A, and 1201(a) of
the Code), and any interest, additions to tax or penalties applicable or related
to such tax.
 
 "Governmental Entity" means any Federal, state, local, provincial or
foreign government or any court of competent jurisdiction, administrative agency
or commission or other governmental authority or instrumentality, whether
domestic or foreign.
 
 "Hypothetical Tax Basis" means, with respect to any asset at any
time, the tax basis that such asset would have at such time if no Basis
Adjustment had been made.
 
 "Hypothetical Tax Liability" means, with respect to any Covered
Taxable Year, the liability for Covered Taxes of the XXX Affiliated Group using
the same methods, elections, conventions and similar practices used on the
relevant XXX Consolidated Return, but using the Hypothetical Tax Basis instead
of the actual tax basis of each relevant asset and excluding any deduction
attributable to the Imputed Interest.
 
 "Imputed Interest" shall mean any interest imputed under Section
1272, 1274 or 483 or other provision of the Code and the similar section of the
California Revenue and Taxation Code with respect to XXX's payment obligations
under this Agreement.
 
 "Initial Value" shall mean the weighted average trading price of XXX
Class A common stock on the date of its initial public offering, as reported on
the New York Stock Exchange consolidated tape.
 
 "IRS" means the United States Internal Revenue Service.
 
 "LIBOR" means, for each month (or portion thereof) during any
period, an interest rate per annum equal to the rate per annum reported, on the
date two days prior to the first day of such month, on the Telerate Page 3750
(or if such screen shall cease to be publicly available, as reported on Reuters
Screen page "LIBO" or by any other publicly available source of such market
rate) for London interbank offered rates for United States dollar deposits for
such month (or portion thereof).
 
 "Original Assets" is defined in the recitals.
 
 "Person" means and includes any individual, firm, corporation,
partnership (including, without limitation, any limited, general or limited
liability partnership), company, limited liability company, trust, joint
venture, association, joint stock company, unincorporated organization or
similar entity or Governmental Entity.
 
 "Proceeding" is defined in Section 7.08 of this Agreement.
<PAGE>
 8
 
 
  "Realized Tax Benefit" means, for a Covered Taxable Year, the
excess, if any, of the Hypothetical Tax Liability over the actual liability for
Covered Taxes of the XXX Affiliated Group for such Covered Taxable Year. If all
or a portion of the actual tax liability for Covered Taxes for the Covered
Taxable Year arises as a result of an audit by a Taxing Authority of any Covered
Taxable Year, such liability shall not be included in determining the Realized
Tax Benefit or the Realized Tax Detriment unless and until there has been a
Determination.
 
 "Realized Tax Detriment" means, for a Covered Taxable Year, the
excess, if any, of the actual liability for Covered Taxes of the XXX Affiliated
Group over the Hypothetical Tax Liability for such Covered Taxable Year. If all
or a portion of the actual tax liability for Covered Taxes for the Covered
Taxable Year arises as a result of an audit by a Taxing Authority of any Covered
Taxable Year, such liability shall not be included in determining the Realized
Tax Benefit or Realized Tax Detriment unless and until there has been a
Determination.
 
 "Reconciliation Procedures" shall mean those procedures set forth in
Section 7.09 of this Agreement.
 
 "Scheduled Termination Date" shall mean the date on which this
Agreement would terminate in the absence of an Early Termination Notice.
 
 "Statutory Rate" means the October 2004 long-term applicable federal
rate.
 
 "Subsidiary" means any entity in which XXX, directly or indirectly,
possesses fifty percent (50%) or more of the total combined voting power of all
classes of its stock.
 
 "Tax Benefit Payment" is defined in Section 3.01 of this Agreement.
 
 "Tax Benefit Schedule" is defined in Section 2.03(a) of this
Agreement.
 
 "Taxable Year" means a taxable year as defined in Section 441(b) of
the Code or comparable section of the California Revenue and Taxation Code, as
applicable, (and, therefore, for the avoidance of doubt, may include a period of
less than 12 months for which a Tax Return is made).
 
 "Taxes" means (i) all forms of taxation or duties imposed, or
required to be collected or withheld, including, without limitation, charges,
together with any related interest, penalties or other additional amounts, (ii)
liability for the payment of any amount of the type described in the preceding
clause (i) as a result of being a member of an affiliated, consolidated,
combined or unitary group, and (iii) liability for the payment of any amounts as
a result of being party to any tax sharing agreement (other than this Agreement)
or as a result of any express or implied obligation to indemnify any other
person with respect to the payment of any amount described in the immediately
preceding clauses (i) or (ii) (other than an obligation to indemnify under this
Agreement).
 
 "Tax Return" means any return, filing, report, questionnaire,
information statement or other document required to be filed, including amended
returns that may be filed, for any taxable period with any Taxing Authority
(whether or not a payment is required to be made with respect to such filing).
<PAGE>
  9
 
 
 "Taxing Authority" means the IRS and any other state, local, foreign
or other Governmental Entity responsible for the administration of Taxes.
 
 "Treasury Regulations" means the final, temporary and proposed
regulations under the Code promulgated from time to time (including
corresponding provisions of succeeding provisions) as in effect for the relevant
taxable period.
 
 "Valuation Assumptions" shall mean, as of any Valuation Date, the
assumptions that (1) in each Covered Taxable Year ending after such Valuation
Date XXX will have taxable income sufficient to fully utilize the deductions
arising from the Basis Adjustment and the Imputed Interest during such Covered
Taxable Year and (2) the Federal Income Tax rates and California State Income
Tax rates that will be in effect for each such Covered Taxable Year will be
those specified for each such Covered Taxable Year by the Code and by the
California Revenue and Taxation Code as in effect on the Valuation Date.
 
 "Valuation Date" means the Closing Date for purposes of determining
the Agreement Value or the date of an Early Termination Notice for purposes of
determining an Early Termination Payment or Change of Control Termination
Payment.
 
 "...... Transaction" is defined in the recitals.
 
 ARTICLE II
 Determination of Realized Tax Benefit or Realized Tax Detriment
 
 SECTION 2.01. Closing Date Basis Adjustment. XXX and YYY II hereby
agree to treat the issuance of this Agreement as property received by YYY II as
partial consideration for the Contribution on the Closing Date for all Tax
purposes. XXX and YYY II further agree that as a result of the issuance of the
Agreement, YYY II shall recognize gain on the Closing Date in an amount not to
exceed the value of the Agreement on the Closing Date (the "Agreement Value")
under Section 351(b) of the Code and the comparable section of the California
Revenue and Taxation Code and the basis in the Original Assets shall be
increased by the amount of such gain recognized under Section 362(a)(2) of the
Code and the comparable section of the California Revenue and Taxation Code (in
addition to any basis increase occurring as a result of the ...... Transaction).
XXX and YYY II shall treat such gain and basis adjustment as occurring entirely
on the Closing Date unless there is a Determination to the contrary. For all Tax
purposes, XXX and YYY II hereby agree that the Agreement Value shall equal the
present value, discounted at the Statutory Rate, of all Tax Benefit Payments
that would be required to be paid by XXX to YYY II during the period from the
Closing Date through the Scheduled Termination Date based on the Valuation
Assumptions. The Valuation Assumptions are to be applied in a manner consistent
with the illustrative example attached as Appendix A hereto.
 
 SECTION 2.02. (a) Basis and Agreement Value Schedule. Within 120
calendar days after the Closing Date, XXX shall deliver to YYY II a schedule
(the "Basis and Agreement Value Schedule") that shows, in reasonable detail, for
Covered Tax purposes (i) the actual tax basis as of the Closing Date of each
Original Asset, (ii) the Basis Adjustment with respect to each Original Asset
and (iii) a calculation of the Agreement Value consistent with the Basis
<PAGE>
  10
 
 
Adjustment and the methodology set forth in Section 2.01. The aggregate tax
basis of the Original Assets as of the Closing Date shall equal the aggregate
Initial Value of the common stock of XXX received by YYY II in the Contribution
plus the Agreement Value. At the time XXX delivers the Basis and Agreement Value
Schedule to YYY II it shall (x) deliver to YYY II schedules and work papers
providing reasonable detail regarding the preparation of the Basis and Agreement
Value Schedule and an Advisory Firm Letter supporting such Basis and Agreement
Value Schedule and (y) allow YYY II reasonable access to the appropriate
representatives at XXX and the Advisory Firm in connection with its review of
such schedule. The Basis and Agreement Value Schedule shall become final and
binding on the parties unless YYY II, within 30 calendar days after receiving
such Basis and Agreement Value Schedule, provides XXX with notice of a material
objection to such Basis and Agreement Value Schedule made in good faith. If the
parties, using their best efforts, are unable to successfully resolve the issues
raised in such notice within 60 calendar days after such Basis and Agreement
Value Schedule was delivered to YYY II, XXX and YYY II shall employ the
Reconciliation Procedures.
 
 (b) Amended Basis and Agreement Value Schedule. The Basis and Agreement
Value Schedule may be amended from time to time by XXX (i) in connection with a
Determination, (ii) to correct inaccuracies in the original Basis and Agreement
Value Schedule identified after the Closing Date as a result of the receipt of
additional information relating to facts or circumstances on or prior to the
Closing Date or (iii) to comply with the expert's determination under the
Reconciliation Procedures. At the time XXX delivers such amended Basis and
Agreement Value Schedule to YYY II it shall (x) deliver to YYY II schedules and
work papers providing reasonable detail regarding the preparation of the amended
Basis and Agreement Value Schedule and an Advisory Firm Letter supporting such
amended Basis and Agreement Value Schedule and (y) allow YYY II reasonable
access to the appropriate representatives at XXX and the Advisory Firm in
connection with its review of such schedule. The amended Basis and Agreement
Value Schedule shall become final and binding on the parties unless YYY II,
within 30 calendar days after receiving such amended Basis and Agreement Value
Schedule, provides XXX with notice of a material objection to such amended Basis
and Agreement Value Schedule made in good faith. If the parties, using their
best efforts, are unable to successfully resolve the issues raised in such
notice within 60 calendar days after such amended Basis and Agreement Value
Schedule was delivered to YYY II, XXX and YYY II shall employ the Reconciliation
Procedures.
 
 SECTION 2.03 (a) Tax Benefit Schedule. Within 10 calendar days after
filing the Federal income tax return of XXX for the relevant Covered Taxable
Year, XXX shall provide to YYY II a schedule showing, in reasonable detail, the
calculation of the Realized Tax Benefit or the Realized Tax Detriment for such
Covered Taxable Year (the "Tax Benefit Schedule"). At the time XXX delivers the
Tax Benefit Schedule to YYY II it shall (i) deliver to YYY II schedules and work
papers providing reasonable detail regarding the preparation of the Tax Benefit
Schedule and an Advisory Firm Letter supporting such Tax Benefit Schedule and
(ii) allow YYY II reasonable access to the appropriate representatives at XXX
and the Advisory Firm in connection with its review of such schedule. The Tax
Benefit Schedule shall become final and binding on the parties unless YYY II,
within 30 calendar days after receiving such Tax Benefit Schedule, provides XXX
with notice of a material objection to such Tax Benefit Schedule made in good
faith. If the parties, using their best efforts, are unable to successfully
<PAGE>
  11
 
 
resolve the issues raised in such notice within 60 calendar days after such Tax
Benefit Schedule was delivered to YYY II, XXX and YYY II shall employ the
Reconciliation Procedures.
 
  (b) Amended Tax Benefit Schedule. The Tax Benefit Schedule for any
Covered Taxable Year may be amended from time to time by XXX (i) in connection
with a Determination affecting such Tax Benefit Schedule, (ii) to correct
inaccuracies in the original Tax Benefit Schedule identified as a result of the
receipt of additional factual information relating to a Covered Taxable Year
after the date the Tax Benefit Schedule was provided to YYY II, (iii) to reflect
a change in the Realized Tax Benefit or Realized Tax Detriment for such Covered
Taxable Year attributable to a carryback or carryforward of a loss or other tax
item to such Covered Taxable Year, (iv) to reflect a change in the Realized Tax
Benefit or Realized Tax Detriment for such Covered Taxable Year attributable to
an amended tax return filed for such Covered Taxable Year (provided, however,
that such a change attributable to an audit of a Tax Return by an applicable
Taxing Authority shall not be taken into account on an Amended Tax Benefit
Schedule unless and until there has been a Determination with respect to such
change) or (v) to comply with the expert's determination under the
Reconciliation Procedures. At the time XXX delivers such an amended Tax Benefit
Schedule pursuant to this Section 2.03(b) (an "Amended Tax Benefit Schedule") to
YYY II it shall (x) deliver to YYY II schedules and work papers providing
reasonable detail regarding the preparation of the Amended Tax Benefit Schedule
and an Advisory Firm Letter supporting such Amended Tax Benefit Schedule and (y)
allow YYY II reasonable access to the appropriate representatives at XXX and the
Advisory Firm in connection with its review of such schedule. Such Amended Tax
Benefit Schedule shall become final and binding on the parties unless YYY II,
within 30 calendar days after receiving such Amended Tax Benefit Schedule,
provides XXX with notice of a material objection to such Amended Tax Benefit
Schedule made in good faith. If the parties, using their best efforts, are
unable to successfully resolve the issues raised in such notice within 60
calendar days after such Amended Tax Benefit Schedule was delivered to YYY II,
XXX and YYY II shall employ the Reconciliation Procedures.
 
 (c) Applicable Principles. The Realized Tax Benefit or Realized Tax
Detriment for each Covered Taxable Year is intended to measure the decrease or
increase in the actual Covered Tax liability of the XXX Affiliated Group for
such Covered Taxable Year attributable to the Basis Adjustment and Imputed
Interest, determined using a "with and without" methodology. Carryovers or
carrybacks of any tax item attributable to the Basis Adjustment and Imputed
Interest (determined using such "with and without" methodology) shall be
considered to be subject to the rules of the Code and the Treasury Regulations
or the California Revenue and Taxation Code, as applicable, governing the use,
limitation and expiration of carryovers or carrybacks of the relevant type. If a
carryover or carryback of any tax item includes a portion that is attributable
to the Basis Adjustment or Imputed Interest and another portion that is not,
such portions shall be considered to be used in the order determined using such
"with and without" methodology. Appendix [B] to this Agreement provides
illustrative examples of the applicable principles described in this Section
2.03(c) of this Agreement.
<PAGE>
 12
 
 
 ARTICLE III
 Tax Benefit Payments
 
 SECTION 3.01. Payments. (a) Within 3 calendar days of the delivery
of the Tax Benefit Schedule to YYY II for any Covered Taxable Year (a) XXX shall
pay to YYY II an amount equal to 85% of the Realized Tax Benefit (if any) for
such Covered Taxable Year and (b) YYY II shall pay to XXX an amount equal to 85%
of the Realized Tax Detriment (if any) for such Covered Taxable Year, in each
case with interest calculated at the Agreed Rate from the due date (without
extensions) for filing the Tax Return with respect to Covered Taxes for such
Covered Taxable Year. Each such payment (a "Tax Benefit Payment") shall be made
by wire transfer of immediately available funds to a bank account of the
recipient previously designated by it to the other party. For the avoidance of
doubt, no Tax Benefit Payment shall be made in respect of estimated tax
payments, including, without limitation, Federal Income Tax payments.
 
 (b) Within 3 calendar days of the delivery of an Amended Tax Benefit
Schedule to YYY II for any Covered Taxable Year, XXX shall pay to YYY II, or YYY
II shall pay to XXX, as appropriate, an amount equal to the difference between
the Realized Tax Benefit or the Realized Tax Detriment reflected on such Amended
Tax Benefit Schedule and the Realized Tax Benefit or the Realized Tax Detriment
reflected on the Tax Benefit Schedule or prior amended Tax Benefit Schedule for
the relevant Covered Taxable Year.
 
 SECTION 3.02. No Duplicative Payments. No duplicative payment of any
amount (including interest) will be required under this Agreement.
 
 ARTICLE IV
 Termination
 
 SECTION 4.01. Early Termination of Agreement. XXX may terminate this
Agreement at any time by paying to YYY II the Early Termination Payment as of
the date of the Early Termination Notice. XXX may terminate this Agreement upon
the occurrence of a Change of Control Event by paying to YYY II the Change of
Control Termination Payment as of the date of the Early Termination Notice. Upon
payment of the Early Termination Payment or the Change of Control Termination
Payment by XXX, neither YYY II nor XXX shall have any further payment
obligations under this Agreement, other than for any (a) Tax Benefit Payment
agreed to by XXX and YYY II as due and payable but unpaid as of the Early
Termination Notice and (b) Tax Benefit Payment due for the Covered Taxable Year
ending with or including the date of the Early Termination Notice (except to the
extent that the amount described in clause (a) or (b) is included in the Early
Termination Payment or Change of Control Termination Payment).
 
 SECTION 4.02. Early Termination Notice. If XXX chooses to exercise
its right of early termination under Section 4.01 above, XXX shall deliver to
YYY II a notice (the "Early Termination Notice") specifying XXX's intention to
exercise such right and showing in reasonable detail the calculation of the
Early Termination Payment or the Change of Control Termination Payment, as the
case may be. At the time XXX delivers the Early Termination Notice to YYY II it
shall (a) deliver to YYY II schedules and work papers providing reasonable
detail regarding the calculation of the Early Termination Payment or the Change
of Control Termination Payment, as the case may be, in a manner consistent with
the guidelines set forth in
<PAGE>
  13
 
 
Section 4.03 of this Agreement and an Advisory Firm Letter supporting such Early
Termination Notice and (b) allow YYY II reasonable access to the appropriate
representatives at XXX and the Advisory Firm in connection with its review of
such Early Termination Notice. Such Early Termination Notice shall become final
and binding on the parties unless YYY II, within 30 calendar days after
receiving such Early Termination Notice, provides XXX with notice of a material
objection to such Early Termination Notice made in good faith. If the parties,
using their best efforts, are unable to successfully resolve the issues raised
in such notice within 60 calendar days after such Early Termination Notice was
delivered to YYY II, XXX and YYY II shall employ the Reconciliation Procedures.
 
 SECTION 4.03. Payment upon Early Termination. (a) Within 3 calendar
days of the delivery to YYY II of the Early Termination Notice or any amendment
to the Early Termination Notice, XXX shall pay to YYY II an amount equal to the
Early Termination Payment or the Change of Control Termination Payment, as the
case may be. Such payment shall be made by wire transfer of immediately
available funds to a bank account designated by the relevant party.
 
 (b) The Early Termination Payment as of the date of an Early
Termination Notice shall equal the present value, discounted at the Early
Termination Rate, of all Tax Benefit Payments that would be required to be paid
by XXX to YYY II during the period from the date of the Early Termination Notice
through the Scheduled Termination Date assuming (1) the Valuation Assumptions
are applied and (2) any loss carryovers generated by the Basis Adjustment or the
Imputed Interest and available as of the date of the Early Termination Notice
will be utilized by XXX on pro rata basis from the date of the Early Termination
Notice through the Scheduled Termination Date. For the avoidance of doubt, the
Early Termination Payment would be equal to the Agreement Value if the Early
Termination Notice were delivered as of the Closing Date and the Early
Termination Rate were equal to the Statutory Rate.
 
 (c) The Change of Control Termination Payment as of the date of an
Early Termination Notice shall equal the Early Termination Payment as of such
date multiplied by 70%.
 
 SECTION 4.04. No Other Right of Early Termination. For the avoidance
of doubt, YYY II shall not be entitled to cause an early termination of this
Agreement.
 
 ARTICLE V
 Subordination and Late Payments
 
 SECTION 5.01. Subordination. Notwithstanding any other provision of
this Agreement to the contrary, any Tax Benefit Payment, Early Termination
Payment or Change of Control Termination Payment required to be made by XXX to
YYY II under this Agreement (a "XXX Payment") shall rank subordinate and junior
in right of payment to any principal, interest or other amounts due and payable
in respect of any XXX Senior Obligations and shall rank pari passu with all
current or future unsecured obligations of XXX that are not XXX Senior
Obligations.
<PAGE>
 14
 
 
 SECTION 5.02. Late Payments by XXX. The amount of all or any portion
of a XXX Payment not made to YYY II when due under the terms of this Agreement
shall be payable together with any interest thereon, computed at the Agreed Rate
and commencing from the date on which such XXX Payment was due and payable.
 
 SECTION 5.03. Late Payments by YYY II. The amount of all or any
portion of a Tax Benefit Payment required to be made by YYY II to XXX under this
Agreement that is not made to XXX when due under the terms of this Agreement
shall be payable together with any interest thereon, computed at the Agreed Rate
and commencing from the date on which such Tax Benefit Payment was due and
payable.
 
 ARTICLE VI
 No Disputes; Consistency; Cooperation
 
 SECTION 6.01. YYY II Participation In XXX Tax Matters. Except as
otherwise provided herein, XXX shall have full responsibility for, and sole
discretion over, all Tax matters concerning any member of the XXX Group,
including without limitation the preparation, filing or amending of any Tax
Return and defending, contesting or settling any issue pertaining to Taxes.
Notwithstanding the foregoing, XXX shall notify YYY II of, and keep YYY II
reasonably informed with respect to, and YYY II shall have the right to
participate in and monitor (but, for the avoidance of doubt, not to control) the
portion of any audit of the XXX Group by a Taxing Authority the outcome of which
is reasonably expected to affect YYY II's rights and obligations under this
Agreement, and shall provide to YYY II reasonable opportunity to provide
information and other input to XXX and its advisors concerning the conduct of
any such portion of such audits. No member of the XXX Group shall settle or
otherwise resolve any audit or other ch......ge by a Taxing Authority relating to
the basis of the Original Assets or the deduction of Imputed Interest without
the consent of YYY II, which YYY II shall not unreasonably withhold, condition
or delay. Nothing in this Agreement shall alter YYY I's full responsibility for,
and sole discretion over, any audit of YYY I or any of its affiliates relating
to the ...... Transaction.
 
 SECTION 6.02. Consistency. Unless there is a Determination to the
contrary, XXX, on its own behalf and on behalf of each member of the XXX Group,
and YYY II, on its own behalf and on behalf of each of its affiliates, agree to
report and cause to be reported for all purposes, including Federal, state and
local Tax purposes and financial reporting purposes, all Tax-related items
(including without limitation the Basis Adjustment and each Tax Benefit Payment)
in a manner consistent with that specified by XXX in any schedule, letter or
certificate required to be provided by or on behalf of XXX under this Agreement.
In the event that an Advisory Firm is replaced with another firm acceptable to
XXX and YYY II, such replacement Advisory Firm shall be required to perform its
services under this Agreement using procedures and methodologies consistent with
the previous Advisory Firm, unless otherwise required by law or XXX and YYY II
agree to the use of other procedures and methodologies.
 
  SECTION 6.03. Cooperation. YYY II shall (and shall cause its
affiliates to) (a) furnish to XXX in a timely manner such information, documents
and other materials as XXX may reasonably request for purposes of making any
determination or computation necessary or appropriate under this Agreement,
preparing any Tax Return or contesting or defending any
<PAGE>
 15
 
 
audit, examination or controversy with any Taxing Authority, (b) make its
employees available to XXX and its representatives to provide explanations of
documents and materials and such other information as the XXX or its
representative may reasonably request in connection with any of the matters
described in clause (a) above, and (c) reasonably cooperate in connection with
any such matter.
 
 ARTICLE VII
 General Provisions
 
 SECTION 7.01. Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be deemed duly
given and received (a) on the date of delivery if delivered personally, or by
facsimile upon confirmation of transmission by the sender's fax machine if sent
on a Business Day (or otherwise on the next Business Day) or (b) on the first
Business Day following the date of dispatch if delivered by a recognized
next-day courier service. All notices hereunder shall be delivered as set forth
below, or pursuant to such other instructions as may be designated in writing by
the party to receive such notice:
 
 if to XXX, to:
 
 XXX, Inc.
 ………
 ………………..
  …………..
 Fax: (……)…………..
 Attention: .………….., Esq.
 General Counsel
 
 with a copy to:
 
 Cravath, Swaine & Moore LLP
  ………………
 ……………….
 ……, …………..
 Fax: (……..) ………….
 Attention: …………., Esq.
 
 
 if to YYY II, to:
 
 
 YYY, Inc.
  ………
 ……….
 Fax: (……..) ………
 Attention: ……..………..
 
 
 
 
 
<PAGE>
 16
 
  Executive Vice President, Investment
 Management; and Executive Vice President,
 Legal
 
 with a copy to:
 
 ………… LLP
  ………..
 ……….
 Fax: (…….) ……….
 Attention: ………., Esq. and ……….,
 Esq.
 
Any party may change its address or fax number by giving the other party written
notice of its new address or fax number in the manner set forth above.
 
 SECTION 7.02. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties, it being understood that
all parties need not sign the same counterpart.
 
 SECTION 7.03. Entire Agreement; No Third Party Beneficiaries. This
Agreement constitutes the entire agreement and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter hereof. This Agreement shall be binding upon and inure solely to
the benefit of each party hereto and their respective successors and permitted
assigns, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other Person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.
 
 SECTION 7.04. Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York without
giving effect to applicable principles of conflict of laws.
 
 SECTION 7.05. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any law or
public policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally
contemplated to the greatest extent possible.
 
 SECTION 7.06. Successors; Assignment; Amendments. YYY II may not
assign this Agreement to any person without the prior written consent of XXX,
which consent shall not be unreasonably withheld, conditioned or delayed;
provided, however, (i) YYY II may pledge some or all of its rights, interests or
entitlements under this Agreement to any U.S. money center bank in connection
with a bona fide loan or other indebtedness and (ii) YYY II may assign some or
all its rights, interests or entitlements under this Agreement to any related
entity within the
<PAGE>
 17
 
 
meaning of Section 267(b) or 707(b) of the Code, in each case without the prior
written consent of XXX. XXX may not assign any of its rights, interests or
entitlements under this Agreement without the consent of YYY II, not to be
unreasonably withheld or delayed. Subject to each of the two immediately
preceding sentences, this Agreement will be binding upon, inure to the benefit
of and be enforceable by, the parties and their respective successors and
assigns including any acquiror of all or substantially all of the assets of XXX.
In the event that XXX ceases to be the common parent of the XXX Affiliated
Group, the successor common parent of such group shall assume all of XXX's
rights and obligations under this Agreement.
 
 No amendment to this Agreement shall be effective unless it shall be
in writing and signed by XXX and YYY II.
 
 SECTION 7.07. Titles and Subtitles. The titles of the sections and
subsections of this Agreement are for convenience of reference only and are not
to be considered in construing this Agreement.
 
 SECTION 7.08. Submission to Jurisdiction; Waivers. With respect to
any suit, action or proceeding relating to this Agreement (collectively, a
"Proceeding"), each party to this Agreement irrevocably (a) consents and submits
to the exclusive jurisdiction of the courts of the States of New York and
Delaware and any court of the United States located in the Borough of Manhattan
in New York City or the State of Delaware; (b) waives any objection which such
party may have at any time to the laying of venue of any Proceeding brought in
any such court, waives any claim that such Proceeding has been brought in an
inconvenient forum and further waives the right to object, with respect to such
Proceeding, that such court does not have jurisdiction over such party; (c)
consents to the service of process at the address set forth for notices in
Section 7.01 herein; provided, however, that such manner of service of process
shall not preclude the service of process in any other manner permitted under
applicable law; and (d) waives, to the fullest extent permitted by applicable
law, any and all rights to trial by jury in connection with any Proceeding.
 
 SECTION 7.09. Reconciliation. In the event that XXX and YYY II are
unable to resolve a disagreement within the relevant period designated in this
Agreement, the matter shall be submitted for determination to a nationally
recognized expert in the particular area of disagreement mutually acceptable to
both parties. The expert shall be employed by a nationally recognized accounting
firm or a law firm (other than the Advisory Firm), and the expert shall not, and
the firm that employs the expert shall not, have any material relationship with
either XXX or YYY II or other actual or potential conflict of interest. If the
matter is not resolved before any payment that is the subject of a disagreement
is due or any Tax Return reflecting the subject of a disagreement is due, such
payment shall be made on the date prescribed by this Agreement and such Tax
Return may be filed as prepared by XXX or its affiliate, subject to adjustment
or amendment upon resolution. The costs and expenses relating to the engagement
of such expert or amending any return shall be borne by the party who did not
have the prevailing position, or if a compromise is reached by the XXX and YYY
II, the costs and expenses shall be borne equally by the parties. The expert
shall determine which party prevails. The determinations of the expert pursuant
to this Section 7.09 shall be binding on XXX and YYY II absent manifest error.
<PAGE>
 18
 
IN WITNESS WHEREOF, XXX and YYY II have duly executed this Agreement as of the
date first written above.
 
 XXX, INC.,
 
 By
 ----------------------------------
  Name:
 Title:
 
 Address:
 
 
 YYY II,
 
 
 By
  ----------------------------------
 Name:
 Title:
 
 Address:
 
 
 

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