Management Incentive Units Generally Clause Samples

Management Incentive Units Generally. The LLC may issue authorized but unissued Management Incentive Units to existing or new employees, officers, directors, consultants or other service providers of the LLC or any of its Subsidiaries pursuant to a Senior Management Agreement or other Equity Agreement approved by the Board, which agreement shall contain such provisions as the Board shall determine; provided, however, that Management Incentive Units may not be issued to any Investor, any Contributor, any Affiliate of any Investor or Contributor or any of their respective employees, officers or directors (other than employees or officers of the LLC and its Subsidiaries). In the Board’s discretion, the terms of any Management Incentive Units issued pursuant to this Section 3.9 may include limitations on the Distribution entitlements of such Units imposed in order to cause such Units to qualify as “profits interests” within the meaning of Internal Revenue Service Revenue Procedures 93-27 and 2001-43, Internal Revenue Service Notice 2005-43, or any future Internal Revenue Service guidance, including, as set forth in Section 3.9(b) below, by establishing a threshold amount (a “Participation Threshold”) of cumulative Distributions that must be made with respect to all or one or more specified classes, groups or series of Units outstanding immediately prior to the issuance of Management Incentive Units before such Management Incentive Units may receive any Distributions. Except as otherwise provided by the Board, any Unitholder who receives Management Incentive Units that are subject to a substantial risk of forfeiture within the meaning of Section 83 of the Code shall make a timely and effective election under Section 83(b) of the Code with respect to such Units. The LLC and all Unitholders will (A) treat such Units as outstanding for tax purposes, (B) treat such Unitholder as a member of the LLC for income tax purposes with respect to such Units and (C) file all tax returns and reports consistently with the foregoing (except for non-U.S. federal returns or reports for which a different tax treatment is required by applicable law), and neither the LLC nor any of its Unitholders will deduct any amount (as wages, compensation or otherwise) for the fair market value of such Units for income tax purposes. This Section 3.9, together with the Senior Management Agreements or other Equity Agreements pursuant to which the Management Incentive Units are issued, are intended to qualify as a compensatory benefit...