Common use of Class C Interests Clause in Contracts

Class C Interests. Class C Interests shall vest and automatically convert to Vested Interests hereunder and under the Partnership Agreement upon the occurrence of a Liquidity Event in which (x) in the case of a Sale Liquidity Event, Blackstone shall have received, in respect of its Class A-1 Interests held on the date of this Agreement (excluding any Class A-1 Interests Disposed of in connection with a Syndication Transaction), cash or other marketable securities (whether through distributions under the Partnership Agreement in respect of such Class A-1 Interests or Dispositions of such Class A-1 Interests) with a fair market value equal to 200% of the amount invested by Blackstone in the Partnership in respect of such Class A-1 Interests (excluding any Class A-1 Interests Disposed of in connection with a Syndication Transaction) or (y) in the case of a Distribution Liquidity Event, the Class A-1 Interests distributed have a fair market value equal to 200% of the amount invested by Blackstone in the Partnership in respect of such Class A-1 Interests (excluding any Class A-1 Interests Disposed of in connection with a Syndication Transaction). Notwithstanding the foregoing in the event that: (i) Executive’s employment with the Company is terminated for any reason, except as set forth, and to the extent provided, in Section 3.1(b)(ii)), Executive shall have no right to further vesting of the Class C Interests that are Unvested Interests (and such Class C Interests shall be Unvested Interests notwithstanding the provisions of this Section 3.1(b)); and (ii) Executive’s employment with the Company is terminated (x) by the Company without Cause, (y) as a result of death or Disability or (z) by Executive as a result of a Constructive Termination, a percentage of Executive’s Class C Interests that are then Unvested Interests shall thereupon be deemed vested in an amount equal to the percentage of Executive’s original Class B Interests that became Vested Interests pursuant to Section 3.1(a) at the time of such termination (but giving effect to Section 3.1(a)(iii)) (any Class C Interests that become Vested Interests as a result of this Section 3.1(b)(ii) shall be referred to as “Accelerated Class C Interests”).

Class C Interests. (i) Subject to this Section 3.2(c)(i), the Company is hereby authorized to issue, from time to time, Class C1 Interests and Class C2 Interests to Management Aggregator (and any of its designees, including without limitation to employees, consultants, managers, officers, or independent contractors of the Company or its Affiliates), as shall be reflected Exhibit 1 attached hereto; provided that any such issuance does not result in (x) an aggregate number of Class C1 Interests in excess of fifteen percent (15%) of the aggregate total number of authorized Class A Interests and Class C1 Interests at any time or (y) an aggregate number of Class C2 Interests in excess of two percent (2%) of the aggregate total number of authorized Class B Interests at any time. Following issuance of any Class C Interests, the Board shall cause Exhibit 1 hereto to be updated to provide a list of the Class C Members, the Class C Interests and the respective Class C1 Pro Rata Shares or Class C2 Pro Rata Shares corresponding to such Class C Interests. (ii) The Class C Interests are intended to constitute “profits interests” within the meaning of Revenue Procedure 93-27, 1993-24 I.R.B. 63, as clarified by Revenue Procedure 2001-43, 2001-2 C.B. 191, unless the Board determines otherwise with respect to particular Class C Interests. (iii) At the time of issuance, the Board shall vest and automatically convert designate a value (such value, the “Class C Threshold Value”) applicable to Vested each such Class C Interests hereunder and under to the Partnership Agreement upon extent necessary to cause such Class C Interests to constitute a “profits interest” as provided in Section 3.2(c)(ii) above, but not less than zero. The Board shall amend (or cause to be amended) Exhibit 1 as needed to reflect any modifications to the occurrence of Class C Threshold Value, or establish a Liquidity Event in which (x) in the case of a Sale Liquidity Event, Blackstone shall have receivednew Class C Threshold Value, in respect each case, to the extent necessary to cause the applicable Class C Interest to constitute a “profits interest” as provided in Section (ii) above. (iv) The initial number of its Class A-1 C1 Interests held on shall be 60,293.16 and the date initial number of Class C2 Interests shall be zero. Subject to the terms of this Agreement (excluding any including Section 3.2(c)(i)), Class A-1 C Interests Disposed may be allocated and issued from time to time as determined by the Board. 0135789-0000013 NYO1: 2007119703.11 (v) Notwithstanding anything to the contrary in this Agreement, if the recipients of Class C Interests are liable for taxes in connection with the issuance of such Class C Interests, the Company shall not make any Tax Distribution to such recipients. Absent a Syndication Transaction)contrary determination by the Board based on a change in law governing the taxation of the Class C Interests: (A) the Company and each Member shall treat each Class C Interest granted to such Member as a “profits interest”; (B) the Company and each Member shall treat each holder of a Class C Interest as the owner of such interests from the date such interests are granted until such interests are forfeited or otherwise disposed of; (C) each holder of a Class C Interest agrees to take into account such distributive share of the Company’s income, cash gain, deduction and loss in computing its U.S. federal income tax liability for the entire period during which it holds such Class C Interest; and (D) each Member agrees not to claim a deduction (as wages, compensation or other marketable securities (whether through distributions under the Partnership Agreement otherwise) in respect of such Class A-1 Interests or Dispositions of such Class A-1 Interests) with a fair market value equal to 200% of the amount invested by Blackstone in the Partnership in respect of such Class A-1 Interests (excluding any Class A-1 Interests Disposed of in connection with a Syndication Transaction) C Interest either upon grant or (y) in the case of a Distribution Liquidity Event, the Class A-1 Interests distributed have a fair market value equal to 200% of the amount invested by Blackstone in the Partnership in respect of such Class A-1 Interests (excluding any Class A-1 Interests Disposed of in connection with a Syndication Transaction). Notwithstanding the foregoing in the event that: (i) Executive’s employment with the Company is terminated for any reason, except as set forth, and to the extent provided, in Section 3.1(b)(ii)), Executive shall have no right to further vesting of the Class C Interests that are Unvested Interests (and Interest. Upon a change in law governing the taxation of “profits interests”, each Member shall take such Class C Interests shall actions as may be Unvested Interests notwithstanding the provisions of this Section 3.1(b)); and (ii) Executive’s employment with the Company is terminated (x) requested by the Company in response to such change in law, including agreeing to amend this Agreement in a manner the Board deems necessary or appropriate to reflect such change in law and reporting any such matters in their income tax returns as determined by the Board. Notwithstanding anything in this Agreement to the contrary, the Board is hereby authorized and empowered, without Causefurther vote or action of the Members, (y) to amend this Agreement as it deems necessary to comply with the requirements of, or address changes to, any law applicable to the taxation of “profits interests”. The Company and each Member agrees to comply with all requirements of treating each Class C Interest as a result of death or Disability or profits interest for federal income tax purposes. (zvi) by Executive as a result of a Constructive TerminationNotwithstanding anything to the contrary herein, a percentage of Executive’s any distributions with respect to any Class C Interests that are then Unvested unvested or that are “Downstairs Class C Interests” (as such term is used and defined in the Management Aggregator LLCA) that correspond to unvested Upstairs Class C Interests shall thereupon be deemed vested in an amount equal (pursuant to the percentage of Executive’s original Management Aggregator LLCA) that would otherwise be distributed to the Member holding such Class B Interests that became Vested C Interests pursuant to Section 3.1(a5.4 shall be held by the Company in a segregated interest-bearing account (separate from and not commingled with the general funds of the Company) and shall be invested in such manner as may be determined by the Board. Any such amount with respect to such Class C Interest that is unvested or that is a “Downstairs Class C Interest” that corresponds to unvested Upstairs Class C Interests, including any interest or other income with respect thereto, shall not be distributed, and shall not be treated as distributed for income tax purposes, to the Member holding such Class C Interest until such Class C Interest vests or the corresponding Upstairs Class C Interest vests (as applicable) and, at such time as the time of Class C Interest vests or the Upstairs Class C Interest vests (as applicable), such termination (but giving effect amount shall be distributed to Section 3.1(a)(iii)) (the Member holding such Class C Interest. Without limiting the foregoing, if any Class C Interests that become Vested Interests as a result Interest or Upstairs Class C Interest is forfeited prior to the vesting of such Class C Interest or Upstairs Class C Interest, then any such amount retained by the Company pursuant to this Section 3.1(b)(ii(vi) (including any interest or other income with respect thereto) shall no longer be referred held for the holder’s benefit and shall be returned to as “Accelerated the Company and made available for future distributions in accordance with Section 5.4 or other use by the Company in accordance with this Agreement, and any corresponding Class C Interests”)Interest that is a “Downstairs Class C Interest” shall automatically be cancelled.