Contract analysis

I. DESCRIPTION OF DOCUMENTS PRODUCED A. Overview of PPC's Transfer Pricing Documentation Program PPC maintained contemporaneous transfer pricing documentation for all four Tax Years at Issue — i.e., tax years 2017, 2018, 2019, and 2020 — pursuant to the requirements of Section 6662(e) of the Internal Revenue Code of 1986, as amended (the "Code"), and the Treasury Regulations promulgated thereunder. The documentation

1. Tax Year 2017 Transfer Pricing Documentation Report. PPC is producing the complete transfer pricing study for tax year 2017, as prepared by Crestfield & Associates LLP. The TY 2017 report addresses each of the following principal categories of intercompany transactions: Cost-Sharing Arrangement ("CSA"). The CSA between PPC and PBI became effective on July 1, 2012, and remained in effect throughout the Tax Years at

2. Tax Year 2018 Transfer Pricing Documentation Report. PPC is producing the complete transfer pricing study for tax year 2018, as prepared by Crestfield & Associates LLP. TY 2018 was the first taxable year under the TCJA, effective January 1, 2018, and accordingly the applicable U.S. federal corporate income tax rate for TY 2018 was 21%. Cost-Sharing Arrangement. For TY 2018, PBI's cost-sharing percentage increased

3. Tax Year 2019 Transfer Pricing Documentation Report. PPC is producing the complete transfer pricing study for tax year 2019, as prepared by Crestfield & Associates LLP. Cost-Sharing Arrangement. For TY 2019, PBI's cost-sharing percentage further increased to 41.1% of total qualified R&D costs. Total qualified R&D costs subject to the CSA for TY 2019 were $561,200,000, resulting in PBI's share of $230,650,000. The

4. Tax Year 2020 Transfer Pricing Documentation Report. PPC is producing the complete transfer pricing study for tax year 2020, as prepared by Crestfield & Associates LLP. Cost-Sharing Arrangement. For TY 2020, PBI's cost-sharing percentage increased to 42.7% of total qualified R&D costs. Total qualified R&D costs subject to the CSA for TY 2020 were $598,400,000, yielding PBI's share of $255,520,000. The TY 2020 RAB

II. DOCUMENT PRODUCTION INDEX The documents responsive to IDR No. 4 are being produced and organized as follows, with consecutive Bates numbering in the format PPC-TP-000001 through PPC-TP-[final page]: The total production comprises 2,104 pages across five tabbed sections. Documents have been produced in native electronic format where available (including Excel workpapers and financial models), with corresponding ha

III. PRIVILEGE RESERVATION PPC has conducted a review of all documentation responsive to IDR No. 4 to identify and withhold materials that are protected by the attorney-client privilege, the work-product doctrine, or any other applicable privilege or protection. To the extent that any attorney-client privileged communications, attorney work-product materials, or documents prepared in anticipation of litigation have b

IV. REPRESENTATIONS AND LIMITATIONS PPC represents that the documents produced herewith constitute PPC's contemporaneous transfer pricing documentation as maintained pursuant to the requirements of IRC § 6662(e)(3)(B) and Treas. Reg. § 1.6662-6 for tax years 2017, 2018, 2019, and 2020. The documentation was prepared on a contemporaneous basis by Crestfield & Associates LLP and has been maintained in PPC's files in th

V. REQUEST FOR CONFIRMATION OF RECEIPT We respectfully request that Revenue Agent Dunleavy acknowledge receipt of this production by return correspondence or email at her earliest convenience. For any questions regarding this production, or to discuss any aspect of the produced documentation, please contact Garrett Simmons, Lead Associate, at Calderwood & Harkness LLP, 1735 Market Street, Suite 3100, Philadelphia, PA

VI. CLOSING PPC and its counsel at Calderwood & Harkness LLP remain committed to cooperating fully with the examination team throughout this examination. We are prepared to discuss any questions that Revenue Agent Dunleavy or the examination team may have regarding the transfer pricing documentation produced herewith, including the methodologies employed, the economic analyses performed, or the factual bases for PPC'