TAX ALLOCATION AGREEMENT

EXHIBIT 10.1

THIS TAX ALLOCATION AGREEMENT (this “ Agreement ”) is made and entered into as of December 21, 2006, by and between ACACIA RESEARCH CORPORATION, a Delaware corporation (“ Acacia ”), and COMBIMATRIX CORPORATION, a Delaware corporation and, as of the date hereof, a wholly-owned subsidiary of Acacia (“ CombiMatrix ”).

A.    The Acacia Board (as defined herein) has determined that it is appropriate and desirable, subject to the terms and conditions contained in the Distribution Agreement by and between Acacia and CombiMatrix dated as of the date hereof (“ Distribution Agreement ”) for Acacia to distribute on a pro rata basis to holders of shares of CBMX Tracking Stock (as defined herein) the outstanding shares of CombiMatrix Common Stock (as defined herein) owned by Acacia.

B.    Acacia and CombiMatrix wish to provide for and agree upon the allocation between the Acacia Tax Group (as defined herein) and the CombiMatrix Tax Group (as defined herein) of all responsibilities, liabilities and benefits relating to or affecting Taxes (as defined herein) paid or payable by either of them for all taxable periods, whether beginning before, on or after the Distribution Date (as defined herein).

NOW, THEREFORE, in consideration of the premises and of the respective agreements contained in this Agreement, the parties hereto hereby agree as follows:

Section 1.01    General . As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined). Any capitalized term not otherwise defined in this Agreement shall have the meaning ascribed to it in the Distribution Agreement.

“ Acacia ” shall have the meaning ascribed thereto in the preamble.

“ Acacia Board ” shall mean the Board of Directors of Acacia or a duly authorized committee thereof.

“ Acacia Business ” shall have the meaning ascribed thereto that term in the Distribution Agreement.

“ Acacia/CombiMatrix Tax Group ” shall mean any corporation or other legal entity which is a member of the Acacia Tax Group or the CombiMatrix Tax Group but only with respect to taxable periods (or portions thereof) ending on or before or including the Distribution Date.

“ Acacia Group Employees and Former Employees ” shall mean individuals (i) who are employees of any member of the Acacia Tax Group on the date of the event giving rise to a deduction in respect of any Compensation Payments made to such individuals or Stock Options or Restricted Stock held by such individuals, or (ii) whose most recent employment with any member of the Acacia Tax Group or the CombiMatrix Tax Group prior to such date was more closely associated with the Acacia Business or some other business rather than the CombiMatrix Business.

“ Acacia Restricted Stock ” shall mean shares of CBMX Tracking Stock subject to restrictions on transferability and subject to a substantial risk of forfeiture.

“ Acacia Tax Group ” shall mean (i) Acacia, (ii) any corporation or other legal entity which Acacia directly or indirectly owns immediately following the Distribution Date other than a member of the CombiMatrix Tax Group, and (iii) any other corporation or other legal entity which Acacia directly or indirectly owned at any time prior to the Distribution Date (but only with respect to the period such corporation or other entity was so owned by Acacia) other than a member of the CombiMatrix Tax Group.

“ Actually Realized ” shall mean, for purposes of determining the timing of any Taxes (or related Tax cost or benefit) relating to any payment, transaction, occurrence or event, the time at which the amount of Taxes (including estimated Taxes) payable by any person is increased above or reduced below, as the case may be, the amount of Taxes that such person would be required to pay but for the payment, transaction, occurrence or event.

“ CBMX Tracking Stock ” shall mean the Acacia Research-CombiMatrix Common, par value of $0.001 per share, of Acacia.

“ CBMX Stock Options ” shall mean options to acquire CBMX Tracking Stock.

“ Code ” shall mean the Internal Revenue Code of 1986, as amended, or any successor legislation.

“ CombiMatrix ” shall have the meaning ascribed thereto in the preamble.

“ CombiMatrix Business ” shall have the meaning ascribed thereto that term in the Distribution Agreement.

“ CombiMatrix Common Stock ” shall mean the Common Stock, par value $0.001 per share, of CombiMatrix.

“ CombiMatrix Common Stock Options ” shall mean options to acquire CombiMatrix Common Stock.

“ CombiMatrix Group Employees and Former Employees ” shall mean individuals (i) who are employees of any member of the CombiMatrix Tax Group on the date of the event giving rise to a deduction in respect of any Compensation Payments made to such individuals or Stock Options held by such individuals or (ii) whose most recent employment with any member of the Acacia Tax Group or the CombiMatrix Tax Group prior to such date was more closely associated with the CombiMatrix Business or some other business rather than the Acacia Business.

“ CombiMatrix Tax Act ” shall have the meaning set forth in Section 3.02(a).

“ CombiMatrix Tax Group ” shall mean (i) CombiMatrix and (ii) any corporation or other legal entity set forth on Schedule 1.01.

“ CombiMatrix Tax Representation Letter ” shall mean the letter delivered by CombiMatrix to Acacia on the Distribution Date, substantially in the form set forth in Schedule 3.02(b).

“ Compensation Payments ” shall mean all non-qualified employee benefit plan and welfare benefit plan payments made under the Employee Matters Agreement dated the date hereof by and between Acacia and CombiMatrix.

“ Distribution ” shall mean the distribution of the CombiMatrix Common Stock on a pro rata basis to holders of CBMX Tracking Stock on the Distribution Date pursuant to the Distribution Agreement.

“ Distribution Agreement ” shall have the meaning ascribed thereto in Recital A of this Agreement.

“ Distribution Transaction ” shall mean any transaction undertaken in connection with the Distribution.

“ Distribution Date ” shall mean the date on which the Distribution occurs (or, if different, the date on which the Distribution is deemed to occur for U.S. federal Income Tax purposes). For purposes of this Agreement, the Distribution shall be deemed effective as of 5:00 p.m. (Pacific Standard Time) on the Distribution Date.

“ Foreign Income Tax ” shall mean any Income Tax other than a U.S. federal, state or local Income Tax.

“ Foreign Income Tax Returns ” shall mean any Income Tax Return which is not a U.S. federal, state or local Income Tax Return.

“ Income Tax ” shall mean (a) any Tax based upon, measured by, or calculated with respect to (i) net income or profits (including, but not limited to, any capital gains, minimum Tax and any Tax on items of Tax preference, but not including sales, use, real or personal property, gross or net receipts, transfer or similar Taxes) or (ii) multiple bases (including, but not limited to, corporate franchise, doing business or occupation Taxes) if one or more of the bases upon which such Tax may be based, measured by, or calculated with respect to, is described in clause (i) above, or (b) any U.S. state or local franchise Tax; including in the case of each of (a) and (b) any related interest and any penalties, additions to such Tax or additional amounts imposed with respect thereto by any Tax Authority.

“ Income Tax Benefit ” shall mean for any taxable period the excess of (i) the hypothetical Income Tax liability of the taxpayer for the taxable period calculated as if the Timing Difference or Reverse Timing Difference, as the case may be, had not occurred but with all other facts unchanged, over (ii) the actual Income Tax liability of the taxpayer for the taxable period, calculated taking into account the Timing Difference or Reverse Timing Difference, as the case may be (treating an Income Tax refund or credit as a negative Income Tax liability for purposes of such calculation).

“ Income Tax Detriment ” shall mean for any taxable period the excess of (i) the actual Income Tax liability of the taxpayer for the taxable period, calculated taking into account the Timing Difference or Reverse Timing Difference, as the case may be, over (ii) the hypothetical Income Tax liability of the taxpayer for the taxable period, calculated as if the Timing Difference or Reverse Timing Difference, as the case may be, had not occurred but with all other facts unchanged (treating an Income Tax refund or credit as a negative Income Tax liability for purposes of such calculation).

“ Income Tax Return ” shall mean any Tax Return that relates to Income Taxes.

“ Indemnitee ” shall have the meaning set forth in Section 3.03.

“ Indemnitor ” shall have the meaning set forth in Section 3.03.

“ Indemnity Issue ” shall have the meaning set forth in Section 3.03.

“ IRS ” shall mean the Internal Revenue Service.

“ Non-Income Tax ” shall mean any Tax other than an Income Tax.

“ Person ” shall mean any individual, partnership, joint venture, corporation, limited liability entity, trust, unincorporated organization or other entity (including a governmental entity).

“ Post-Distribution Taxable Period ” shall mean a taxable period beginning after the Distribution Date.

“ Post-Distribution Tax Act ” shall have the meaning set forth in Section 3.01(a).

“ Post-Tax Indemnification Period ” shall mean any Post-Distribution Taxable Period and that portion of any Straddle Period that begins on the day after the Distribution Date.

“ Pre-Distribution Taxable Period ” shall mean a taxable period ending on or before the Distribution Date.

“ Restricted Stock ” shall mean CBMX Restricted Stock or CombiMatrix Restricted Stock.

“ Reverse Timing Difference ” shall mean an increase in income, gain or recapture, or a decrease in deduction, loss or credit, as calculated for Income Tax purposes, of the taxpayer for the Tax Indemnification Period coupled with an increase in deduction, loss or credit, or a decrease in income, gain or recapture, of the taxpayer for any Post-Tax Indemnification Period.

“ Rights ” shall have the meaning ascribed thereto in the Distribution Agreement.

“ Separation Agreements ” shall have the meaning ascribed thereto in the Distribution Agreement.

“ Stock Options ” shall mean CombiMatrix Common Stock Options or CBMX Tracking Stock Options.

“ Straddle Period ” shall mean a taxable period that includes but does not end on the Distribution Date.

“ Tax ” and “ Taxes ” shall mean all forms of taxation, whenever created or imposed, and whether of the United States or elsewhere, and whether imposed by a federal, state, municipal, governmental, territorial, local, foreign or other body, and without limiting the generality of the foregoing, shall include net income, gross income, gross receipts, sales, use, value added, ad valorem, transfer, recording, franchise, profits, license, lease, service, service use, payroll, wage, withholding, employment, unemployment insurance, workers compensation, social security, excise, severance, stamp, business license, business organization, occupation, premium, property, environmental, windfall profits, customs, duties, alternative minimum, estimated or other taxes, fees, premiums, assessments or charges of any kind whatever imposed or collected by any governmental entity or political subdivision thereof, together with any related interest and any penalties, additions to such tax or additional amounts imposed with respect thereto by any Tax Authority.

“ Tax Authority ” shall mean, with respect to any Tax, any governmental entity, quasi-governmental body or political subdivision thereof that imposes such Tax and the agency (if any) charged with the determination or collection of such Tax for such entity, body or subdivision.

“ Tax Group ” shall mean the Acacia Tax Group or the CombiMatrix Tax Group, as the case may be.

“ Tax Indemnification Period ” shall mean any Pre-Distribution Taxable Period and that portion of any Straddle Period that ends on the Distribution Date.

“ Tax Return ” shall mean any return, filing, questionnaire, information return, election or other document required or permitted to be filed, including requests for extensions of time, filings made with respect to estimated tax payments, claims for refund and amended returns that may be filed, for any period with any Tax Authority (whether domestic or foreign) in connection with any Tax (whether or not a payment is required to be made with respect to such filing).

“ Timing Difference ” means an increase in income, gain or recapture, or a decrease in deduction, loss or credit, as calculated for Income Tax purposes, of the taxpayer for any Post-Tax Indemnification Period coupled with an increase in deduction, loss or credit, or a decrease in income, gain or recapture, of the taxpayer for the Tax Indemnification Period.

Section 1.02    Schedules, etc . References to a “ Schedule ” are, unless otherwise specified, to a Schedule attached to this Agreement; references to “ Section ” or “ Article ” are, unless otherwise specified, to one of the Sections or Articles of this Agreement; references to “ sub-section ” are, unless the context otherwise requires, references to the section in which the reference appears; and references to this Agreement include the Schedules.

Section 2.01    Preparation of Tax Returns .

(a)    United States Federal Income Tax Returns .

(i)    Acacia shall prepare and file or cause to be prepared and filed all U.S. federal Income Tax Returns (including amendments thereto) which are required to be filed in respect of (A) a member of the Acacia/CombiMatrix Tax Group for any Pre-Distribution Taxable Period or Straddle Period or (B) a member of the Acacia Tax Group for any Post-Distribution Taxable Period. CombiMatrix hereby irrevocably designates, and agrees to cause each of its affiliates to so designate, Acacia as its agent to take any and all actions necessary or incidental to the preparation and filing of such U.S. federal Income Tax Returns of Acacia’s affiliated group.

(ii)    All U.S. federal Income Tax Returns (including amendments thereto) required to be filed in respect of a member of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group are the responsibility of the CombiMatrix Tax Group.

(b)    United States State and Local Income Tax Returns .

(i)    Acacia shall prepare and file or cause to be prepared and filed all U.S. state and local Income Tax Returns (including amendments thereto) which are required to be filed in respect of (A) a member of the Acacia/CombiMatrix Tax Group for any Pre-Distribution Taxable Period or Straddle Period including consolidated, combined and unitary Tax Returns including a member of the CombiMatrix Tax Group, (B) any member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts or has conducted both an Acacia business and a CombiMatrix business or (C) a member of the Acacia Tax Group for any Post-Distribution Taxable Period. CombiMatrix hereby irrevocably designates, and agrees to cause each of its affiliates to so designate, Acacia as its agent to take any and all actions necessary or incidental to the preparation and filing of such U.S. state and local Income Tax Returns of members of the Acacia Tax Group.

(ii)    All U.S. state and local Income Tax Returns (including amendments thereto) required to be filed in respect of a member of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group shall be the responsibility of the CombiMatrix Tax Group.

(c)    Foreign Income Tax Returns .

(i)    Acacia shall prepare and file or cause to be prepared and filed all Foreign Income Tax Returns (including amendments thereto) which are required to be filed in respect of (A) a member of the Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period, (B) a member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts, or has conducted, both an Acacia business and a CombiMatrix business, or (C) a member of the Acacia Tax Group for any Post-Distribution Taxable Period. CombiMatrix hereby irrevocably designates, and agrees to cause each of its affiliates to so designate, Acacia as its agent to take any and all actions necessary or incidental to the preparation and filing of such Foreign Income Tax Returns of members of the Acacia Tax Group.

(ii)    All Foreign Income Tax Returns (including amendments thereto) required to be filed in respect of a member of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group shall be the responsibility of the CombiMatrix Tax Group.

(d)    Non-Income Tax Returns .

(i)    Acacia shall prepare and file or cause to be prepared and filed all Tax Returns (including amendments thereto) which are Non-Income Tax Returns which are required to be filed in respect of (A) a member of the Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period), (B) any member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts or has conducted both an Acacia business and a CombiMatrix business or (C) a member of the Acacia Tax Group for any Post-Distribution Taxable Period. CombiMatrix hereby irrevocably designates, and agrees to cause each of its affiliates to so designate, Acacia as its agent to take any and all actions necessary or incidental to the preparation and filing of such non-U.S. federal Income Tax Returns.

(ii)    All Non-Income Tax Returns (including amendments thereto) required to be filed in respect of a member of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group shall be the responsibility of the CombiMatrix Tax Group.

(e)    Consistent with Past Practice; Review by Non-Responsible Party . Unless Acacia and CombiMatrix otherwise agree in writing, all Tax Returns (including amendments thereto) described in this Section 2.01 filed after the date of this Agreement for Pre-Distribution Taxable Periods or Straddle Periods, in the absence of a controlling change in law or circumstances, shall be prepared on a basis consistent with the elections, accounting methods, conventions and principles of taxation used for the most recent taxable periods for which Tax Returns involving similar matters have been filed. Upon the request of the non-responsible party, the party responsible under this Section 2.01 for preparation of a particular Tax Return for Pre-Distribution Taxable Periods or Straddle Periods shall make available a draft of such Tax Return (or relevant portions thereof) for review and comment by such non-responsible party. Subject to the provisions of this Agreement, all decisions relating to the preparation of Tax Returns shall be made in the sole discretion of the party responsible under this Agreement for such preparation.

(f)    Responsibility for Filing . Although, pursuant to this Agreement, Acacia or CombiMatrix may be responsible for filing a particular Tax Return, Acacia and CombiMatrix have agreed that the actual preparation and filing of certain Tax Returns will be done by the non-responsible party. Schedule 2.01(f) attached hereto sets forth a schedule specifying such Tax Returns. Acacia and CombiMatrix may agree from time to time to additions to or deletions from Schedule 2.01(f).

Section 2.02    Payment of Taxes .

(a)    United States Federal Income Taxes . Except as otherwise provided in this Agreement:

(i)    Acacia shall pay or cause to be paid, on a timely basis, all Taxes due with respect to the consolidated U.S. federal Income Tax liability for (A) all members of the Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period, including consolidated Tax Returns also including a member of the CombiMatrix Tax Group, and (B) any member of the Acacia Tax Group for any Post-Distribution Taxable Period, provided , however , that CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees to pay directly to or at the direction of Acacia, at least five days prior to the date payment (including estimated payment) thereof is due, the share of such U.S. federal Income Tax liability of any member of the CombiMatrix Tax Group attributable to the CombiMatrix business, assets or activities allocated between the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group, on the other hand, determined in a manner analogous to that set forth in Treasury Regulation Section 1.1552-1(a)(2).

(ii)    CombiMatrix shall pay or cause to be paid, on a timely basis, all U.S. federal Income Taxes of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group.

(b)    United States State and Local Income Taxes . Except as otherwise provided in this Agreement:

(i)    Acacia shall pay or cause to be paid, on a timely basis, all Taxes due with respect to the state and local Income Tax liability for (A) all members of the Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period, including consolidated, combined and unitary Tax Returns also including a member of the CombiMatrix Tax Group, (B) any member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts or has conducted both an Acacia business and a CombiMatrix business, and (C) any member of the Acacia Tax Group for any Post-Distribution Taxable Period, provided , however , that CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees to pay directly to or at the direction of Acacia, at least five days prior to the date payment (including estimated payment) thereof is due, the share of such U.S. state and local Income Tax liability of any member of the CombiMatrix Tax Group attributable to the CombiMatrix business, assets or activities allocated between the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group, on the other hand, determined in a manner analogous to that set forth in Treasury Regulation Section 1.1552-1(a)(2).

(ii)    CombiMatrix shall pay or cause to be paid, on a timely basis, all U.S. state and local Income Taxes of the CombiMatrix Tax Group which are not the responsibility of the Acacia Tax Group.

(c)    Foreign Income Taxes . Except as otherwise provided in this Agreement:

(i)    Acacia shall pay or cause to be paid, on a timely basis, all Taxes due with respect to the Foreign Income Tax liability for (A) all members of the Acacia Tax Group for any Pre-Distribution Taxable Period or Straddle Period, (B) any member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts, or has conducted, both an Acacia business and a CombiMatrix business, or (C) any member of the Acacia Tax Group for any Post-Distribution Taxable Period, provided , however , that CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees to pay directly to or at the direction of Acacia, at least five days prior to the date payment (including estimated payment) thereof is due, the share of such Foreign Income Tax liability of any member of the CombiMatrix Tax Group attributable to the CombiMatrix business, assets or activities allocated between the Acacia Tax Group, on the one hand, and the CombiMatrix Tax Group, on the other hand, determined in a manner analogous to that set forth in Treasury Regulation Section 1.1552-1(a)(2).

(ii)    CombiMatrix shall pay or cause to be paid, on a timely basis, all Foreign Income Taxes which are not the responsibility of the Acacia Tax Group.

(d)    Non-Income Taxes . Except as otherwise provided in this Agreement:

(i)    Acacia shall pay or cause to be paid, on a timely basis, all Taxes which are Non-Income Taxes due with respect to the Tax liability for (A) all members of the Acacia Tax Group for any Pre-Distribution Taxable Period, Straddle Period or Post-Distribution Taxable Period, (B) any member of the CombiMatrix Tax Group for any Pre-Distribution Period or Straddle Period in which it conducts or has conducted both an Acacia business and a CombiMatrix business and (C) a member of the Acacia Tax Group for any Post-Distribution Taxable Period, provided , however , that CombiMatrix, on behalf of the CombiMatrix Tax Group hereby assumes and agrees to pay directly to or at the direction of Acacia, at least five days prior to the date payment (including estimated payment) thereof is due, the share of such Non-Income Tax liability of any member of the CombiMatrix Tax Group, attributable to the CombiMatrix business, assets or activities.

(ii)    CombiMatrix shall pay or cause to be paid, on a timely basis, all Taxes which are Non-Income Taxes which are not the responsibility of the Acacia Tax Group.

(e)    Employment Taxes . CombiMatrix shall pay or cause to be paid, on a timely basis, all employment Taxes for all Pre-Distribution Taxable Periods, Straddle Periods and Post-Distribution Taxable Periods attributable to (I) any employee of the CombiMatrix Tax Group on the day following the Distribution Date or (II) any individual who was neither an employee of the CombiMatrix Tax Group or the Acacia Tax Group on the day following the Distribution Date but whose most recent employment prior to the Distribution Date with any member of the CombiMatrix Tax Group or the Acacia Tax Group was more closely associated with the CombiMatrix Business rather than the Acacia Business.

(f)    Post-Distribution Date Taxes . Except as otherwise provided in this Agreement, all Taxes for all Post-Distribution Taxable Periods shall be paid or caused to be paid by the party responsible under this Agreement for filing the Tax Returns pursuant to which such Taxes are due or, if no such Tax Returns are due, by the party liable for such Taxes.

(g)    Credit for Prior Tax Payments . To the extent any member of a Tax Group has made a payment of Taxes (including estimated Taxes) on or before the Distribution Date, the party liable for paying such Taxes under this Agreement shall be entitled to treat the payment as having been paid or caused to have been paid by such party, and such party shall not be required to reimburse the party which actually paid such Taxes.

(h)    Responsibility for Payment; Notice of Payment Due . Although Acacia or CombiMatrix may be responsible for paying a particular Tax liability, Acacia and CombiMatrix may agree that the actual payment to a Taxing Authority of certain Tax liabilities will be made by the non-responsible party. Acacia and CombiMatrix may agree to prepare a schedule setting forth such Tax liabilities and may agree from time to time to additions to or deletions from such schedule. In each case where Acacia or CombiMatrix, as the case may be, is required to make payment of Taxes to the other party, Acacia or CombiMatrix, as the case may be shall notify the other party as to the amount of Taxes due from the other party at least five days prior to the date payment (including estimated payment) is due.

Section 2.03    Tax Refunds and Carrybacks .

(a)    Retention and Payment of Tax Refunds . Except as otherwise provided in this Agreement, Acacia shall be entitled to retain, and to receive within ten days after Actually Realized by the CombiMatrix Tax Group, the portion of all refunds or credits of Taxes for which the Acacia Tax Group is liable pursuant to Section 2.02 or Section 3.01(a) or is treated as having paid or caused to have been paid pursuant to Section 2.02(d), and CombiMatrix shall be entitled to retain, and to receive within ten days after Actually Realized by the Acacia Tax Group, the portion of all refunds or credits of Taxes for which the CombiMatrix Tax Group is liable pursuant to Section 2.02 or Section 3.01(b) or is treated as having paid or caused to have been paid pursuant to Section 2.02(d). The amount of any refund or credit of Taxes to which Acacia or CombiMatrix is entitled to retain or receive pursuant to the foregoing sentence shall be reduced to take account of any Taxes incurred by the CombiMatrix Tax Group, in the case of a refund or credit to which Acacia is entitled, or the Acacia Tax Group, in the case of a refund or credit to which CombiMatrix is entitled, upon the receipt of such refund or credit.

(b)    Carrybacks; Carryforwards . Unless the parties otherwise agree in writing, CombiMatrix shall elect and shall cause each member of the CombiMatrix Tax Group to elect, where permitted by law, to carry forward any net operating loss, net capital loss, charitable contribution or other item arising after the Distribution Date that could, in the absence of such election, be carried back to a Pre-Distribution Taxable Period. Except as otherwise provided in this Agreement, notwithstanding the provisions of Section 2.03(a), (i) any refund or credit of Taxes resulting from the carryback of any item of Taxes attributable to the CombiMatrix Tax Group arising in a Post-Tax Indemnification Period to a Tax Indemnification Period shall be for the account and benefit of the CombiMatrix Tax Group, (ii) any refund or credit of Taxes resulting from the carryback of any item of Taxes attributable to the Acacia Tax Group arising in a Post-Tax Indemnification Period to a Tax Indemnification Period shall be for the account and benefit of the Acacia Tax Group, and (iii) any refund or credit of Taxes resulting from a carryback of any item of federal Income Taxes attributable to the Acacia/CombiMatrix Tax Group (including derivative state and local refunds or credits) shall be for the account and benefit of the party to this Agreement that generated such benefit, which shall be determined on a case-by-case basis by a nationally recognized accounting firm selected by Acacia and reasonably satisfactory to CombiMatrix.

(c)    Refund Claims . Acacia shall be permitted to file at Acacia’s sole expense, and CombiMatrix shall reasonably cooperate with Acacia in connection with, any claims for refund of Taxes to which Acacia is entitled pursuant to this Section 2.03 or any other provision of this Agreement. Acacia shall reimburse CombiMatrix for any reasonable out-of-pocket costs and expenses incurred by any member of the CombiMatrix Tax Group in connection with such cooperation. CombiMatrix shall be permitted to file at CombiMatrix’s sole expense, and Acacia shall reasonably cooperate with CombiMatrix in connection with, any claims for refunds of Taxes to which CombiMatrix is entitled pursuant to this Section 2.03 or any other provision of this Agreement. CombiMatrix shall reimburse Acacia for any reasonable out-of-pocket costs and expenses incurred by any member of the Acacia Tax Group in connection with such cooperation.

Section 2.04    Allocation of Straddle Period Taxes . In the case of any Straddle Period:

(a)    Periodic Taxes . (i) The periodic Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities that are not based on income or receipts ( e.g. , property Taxes) for the portion of any Straddle Period ending on the Distribution Date shall be computed based on the ratio of the number of days in such portion of the Straddle Period and the number of days in the entire taxable period; and (ii) the periodic taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities that are not based on income or receipts for the portion of any Straddle Period beginning on the day after the Distribution Date shall be computed based on the ratio of the number of days in such portion of the Straddle Period and the number of days in the entire taxable period.

(b)    Non-Periodic Taxes . (i) The Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities for that portion of any Straddle Period ending on the Distribution Date (other than Taxes described in Section 2.04(a) above), shall be computed on a “closing-of-the-books” basis as if such taxable period ended as of the close of business on the Distribution Date, and, in the case of any Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities with respect to any equity interest in any partnership or other “flowthrough” entity, as if the taxable period of such partnership or other “flowthrough” entity ended on the Distribution Date; and (ii) the Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities for that portion of any Straddle Period beginning after the Distribution Date (other than Taxes described in Section 2.04(a) above), shall be computed on a “closing-of-the-books” basis as if such taxable period began on the day after the Distribution Date, and, in the case of any Taxes of a member of the Acacia Tax Group or the CombiMatrix Tax Group or its business, assets or activities with respect to any equity interest in any partnership or other “flowthrough” entity, as if the taxable period of such partnership or other “flowthrough