Partnership Representative. Unless otherwise determined by the Board, the Manager is hereby designated the Partnership Representative of the Company and its Subsidiaries, and is hereby directed and authorized to take whatever steps it, in its reasonable discretion, deems necessary or desirable to perfect such designation, including filing any forms or documents with the IRS or any other Taxing Authority, taking such other action as may from time to time be required under the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules. (a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could reasonably be expected to result in a materially adverse impact on the GATX Member or the Blocker Member (or its Affiliates), then the prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned or delayed). (b) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”), and if the Company is permitted under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages). (c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages). (d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d). (e) Notwithstanding any other provision of this Agreement, (i) any Person who ceases to be a Member shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.
Appears in 2 contracts
Sources: Limited Liability Company Agreement (Gatx Corp), Limited Liability Company Agreement (Gatx Corp)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The General Partner is hereby designated as the Partnership Representative. In addition, the General Partner is hereby authorized to designate or remove any other Person selected by General Partner as the Partnership Representative; provided that all actions taken by the Partnership Representative pursuant to this Section 9.3 shall be subject to the overall oversight and authority of the Company Board. For each Fiscal Year in which the Partnership Representative is an entity, the Partnership shall appoint the “designated individual” identified by the Partnership Representative and approved by the Board to act on its Subsidiariesbehalf in accordance with the applicable Regulations or analogous provisions of state or local Law. Each Partner hereby expressly consents to such designations and agrees to take, and that the General Partner is hereby directed and authorized to take whatever steps it(or cause the Partnership to take), in its reasonable discretion, deems such other actions as may be necessary or desirable advisable pursuant to perfect Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designationdesignations or evidence such Partner’s consent to such designations.
(b) Subject to this Section 9.3, the Partnership Representative shall have the sole authority to act on behalf of the Partnership in connection with, make all relevant decisions regarding application of, and to exercise the rights and powers provided for in the BBA Rules, including filing making any forms elections under the BBA Rules or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any Action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Partnership funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate give prompt written notice to the individual to serve as Original Limited Partner Representative of the Designated Individual and such Designated Individual shall be subject to replacement by commencement of any Audit of the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2its Subsidiaries (a “Specified Audit”). Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the The Partnership Representative shall (i) diligently conduct keep the Original Limited Partner Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Limited Partner Representative (or its designee) to participate (including using separate counsel), in each case at the Original Limited Partners’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each Member in writing (1) the Original Limited Partner Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Partnership shall promptly provide the Original Limited Partner Representative with copies of all material correspondence between the Partnership Representative or the Partnership (as applicable) and any Governmental Entity in connection with such Specified Audit and shall give the Original Limited Partner Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Partnership shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Special Limited Partner) and material adverse impact effect on the GATX Member or Original Limited Partners without the Blocker Member (or its Affiliates), then the Original Limited Partner Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Original Limited Partner Representative (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level (or to elect to pass the adjustment through to the Members any analogous provision of state or local Law) (a “Push-Out Election”)) or (ii) taking any material action under the BBA Rules that would reasonably be expected to have a disproportionate (compared to the Special Limited Partner) and material adverse effect on the Original Limited Partners, the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice case of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: clauses (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; and (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect Notwithstanding anything to the contrary contained in writing to participate this Agreement, in the “pull-in” procedure under event of any conflict between Section 6225(c)(2)(B) 9.1 of the Code Business Combination Agreement and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participatethis Agreement, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) 9.1 of the Code nor prevent any Member from doing soBusiness Combination Agreement shall control. The Partnership, the Partnership Representative, the General Partner, and the Partnership Representative shall take all actions reasonably necessary Partners hereby acknowledge and agree to effectuate any determination the foregoing sentence and expressly agree to be bound by the terms of any Member pursuant to this Section 8.2(d)9.1 of the Business Combination Agreement.
(e) Notwithstanding any other provision This Section 9.3 shall be interpreted to apply to Partners and former Partners and shall survive the Transfer of a Partner’s Partnership Units and the termination, dissolution, liquidation and winding up of the Partnership and, for this Agreementpurpose to the extent not prohibited by applicable Law, (i) any Person who ceases to be a Member the Partnership shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Companycontinuing in existence.
Appears in 2 contracts
Sources: Limited Partnership Agreement (Rush Street Interactive, Inc.), Business Combination Agreement (dMY Technology Group, Inc.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Managing Member is hereby designated as the “partnership representative” pursuant to Section 6223(a) of the Code (in such capacity, the “Partnership Representative”). In addition, the Managing Member is hereby authorized to designate or remove any other Person selected by Managing Member as the Partnership Representative (with the approval of the Original Member Representative, such approval not to be unreasonably withheld, delayed, or conditioned); provided that all actions taken by the Partnership Representative pursuant to this Section 10.3 shall be subject to the overall oversight and authority of the Board. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint the “designated individual” identified by the Partnership Representative and approved by the Board to act on its behalf in accordance with the applicable Regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and that the Managing Member is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 10.3, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe BBA Rules, including filing making any forms elections under the BBA Rules or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any Action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Original Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and or any of its Subsidiaries; provided, that the Subsidiaries (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Original Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Member Representative (or its designee) to participate (including using separate counsel), in each case at the Original Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Original Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Original Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any Governmental Entity in connection with such Specified Audit and shall give the Original Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Managing Member) and material adverse impact effect on the GATX Original Members without the Original Member or the Blocker Member (or its Affiliates), then the Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Original Member Representative (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level (or to elect to pass the adjustment through to the Members any analogous provision of state or local Law) (a “Push-Out Election”)) or (ii) taking any material action under the BBA Rules that would reasonably be expected to have a disproportionate (compared to the Managing Member) and material adverse effect on the Original Members, the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice case of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: clauses (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; and (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect Notwithstanding anything to the contrary contained in writing to participate this Agreement, in the “pull-in” procedure under event of any conflict between Section 6225(c)(2)(B) 7.1 of the Code Business Combination Agreement and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participatethis Agreement, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) 7.1 of the Code nor prevent any Member from doing soBusiness Combination Agreement shall control. The Company, the Partnership Representative, the Managing Member, and the Partnership Representative shall take all actions reasonably necessary Members hereby acknowledge and agree to effectuate any determination the foregoing sentence and expressly agree to be bound by the terms of any Member pursuant to this Section 8.2(d)7.1 of the Business Combination Agreement.
(e) Notwithstanding any other provision This Section 10.3 shall be interpreted to apply to Members and former Members and shall survive the Transfer of a Member’s Company Units and the termination, dissolution, liquidation and winding up of the Company and, for this Agreementpurpose to the extent not prohibited by applicable Law, (i) any Person who ceases to be a Member the Company shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Companycontinuing in existence.
Appears in 2 contracts
Sources: Limited Liability Company Agreement (OppFi Inc.), Business Combination Agreement (FG New America Acquisition Corp.)
Partnership Representative. Unless otherwise determined by the Board, the Manager is hereby designated the Partnership Representative of the Company and its Subsidiaries, and is hereby directed and authorized to take whatever steps it, in its reasonable discretion, deems necessary or desirable to perfect such designation, including filing any forms or documents with the IRS or any other Taxing Authority, taking such other action as may from time to time be required under the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1For each taxable year of the Partnership, the Partnership Representative General Partner shall be authorized entitled to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of designate the Company and its Subsidiaries; provided, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” of the Partnership within the meaning of Section 6223(a) 6223 of the Code could reasonably be expected (the “Partnership Representative”). The General Partner is hereby authorized to result in a materially adverse impact on take any actions necessary under the GATX Member Revised Audit Rules or other guidance to effect such designation with respect to each taxable year of the Blocker Member Partnership (and the Partnership Representative is authorized to take any actions specified under the Revised Audit Rules or its Affiliatesany applicable state statute or local law), then and the prior written consent Partnership shall comply with any requirements necessary to effect such designation. Each Partner hereby consents to such designations and agrees that upon the request of the GATX Member Partnership Representative, such Partner will execute, certify, acknowledge, deliver, swear to, file and record at the appropriate public offices such documents as may be necessary or appropriate to evidence such consent. The Partnership Representative shall keep the Blocker Member, as applicable, Management Representative reasonably informed of any material audit or proceeding asserting any tax liability related to the Partnership and the Partnership Representative shall be required only settle or compromise any such audit or proceeding subject to the Consent of the Management Representative (which consent shall not to be unreasonably withheld, conditioned or delayed).
(b) If The Partnership Representative shall use its commercially reasonable efforts to apply the IRS adjusts rules and elections under the Revised Audit Rules in a manner that minimizes the likelihood that any items Partner would bear any material tax, interest or penalties as a result of Company taxable incomeany audit or proceeding that is attributable to another Partner (other than a predecessor in interest). The Partnership Representative is hereby authorized to take any action reasonably required to cause the financial burden of any “imputed underpayment” (as determined under Section 6225 of the Code) and associated interest, gainadjustments to tax and penalties arising from a partnership-level adjustment that are imposed on the Partnership (an “Imputed Underpayment”) to be borne by the Partners to whom such Imputed Underpayment relates as reasonably determined by the Partnership Representative after consulting with the Partnership’s accountants or other advisers, losstaking into account any differences in the amount of taxes attributable to each Partner because of such Partner’s status, deduction nationality or credit for a given year (a “Review Year”)other characteristics, including such Partner’s actions or omissions, and if each Partner hereby agrees to reasonably cooperate with the Company Partnership Representative in connection with such Imputed Underpayment, including by filing an amended tax return pursuant to Treasury Regulations section 301.6225-2(d)(2); provided, however, that any Holder of Partnership Class PI Common Units shall only be required to file any such amended tax return with the consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed); provided, further, that no Partner shall be required to file any such amended tax return in connection with any Imputed Underpayment that is permitted de minimis as compared to the costs of preparing and filing such an amended tax return. For the avoidance of doubt, each Partner shall bear its own costs and expenses incurred in connection with making any amended tax filings or complying with the alternative procedure in Treasury Regulations section 301.6225-2(d)(2)(x). By executing this Agreement or a counterpart hereof, each Partner (i) expressly authorizes the Partnership Representative and the Partnership to take any and all actions that are reasonably necessary under applicable U.S. federal income tax law (as such law may be revised from time to time) to cause the Partnership to make the election set forth in Section 6226(a) of the Code and Treasury Regulations to either pay Tax at if the Company level or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether Partnership Representative decides to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustmentelection, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) expressly agrees to take any action, and furnish the Board may reduce subsequent distributions Partnership Representative with any information necessary, to give effect to such Member by election. Each Partner hereby severally indemnifies and holds the Partnership, the General Partner and the Partnership Representative harmless for such amount; Partner’s respective portion of the financial burden of an Imputed Underpayment as provided in the foregoing sentences and in furtherance thereof, each Partner agrees (A) to pay such amount to the Partnership within fifteen (15) days following the Partnership’s request for payment (and any failure to pay such amount shall result in interest on such amount calculated at the prime rate plus two percent (2%)) and (iiiB) that any amounts otherwise distributable to such Member (or former Member) Partner may be applied in satisfaction of such obligations. Except with the express written consent of the General Partner, each Partner shall be jointly and severally liable with their predecessors in interest, if any, for amounts owed hereunder in respect of any predecessor in interest to such Partner. No Partner shall file a notice with the IRS under Section 6222(c)(1)(B) of the Code in connection with such Partner’s intention to treat an item on such Partner’s U.S. federal income tax return in a manner that is inconsistent with the treatment of such item on the Partnership’s U.S. federal income tax return unless such Partner has, not less than thirty (30) days prior to the Company for any costs and damages incurred as filing of such notice, provided the Partnership with a result copy of the delay notice and thereafter in payment (without regard to whether a timely manner provides such other information related thereto as the Company could have mitigated any such costs or damages)General Partner shall reasonably request.
(c) In The Partnership Representative shall employ experienced tax counsel to represent the Partnership in connection with any case where an adjustment of Company taxable income, gain, loss, deduction audit or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment investigation of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made Partnership by the IRS or other Taxing Authority would have been allocated to the Members based on their interests and in the Company in the Review Yearconnection with all subsequent administrative and judicial proceedings arising out of such audit. If The fees and expenses of such tax counsel, and all reasonable expenses incurred by the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law in serving as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the shall be Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty expenses and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest be paid by the Company with respect to Partnership. Notwithstanding the Review Year. In the event a Member (or former Member) fails to pay any amount foregoing, it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result responsibility of the delay in payment (without regard General Partner and of each Limited Partner, at their expense, to whether the Company could have mitigated any such costs or damages)employ tax counsel to represent their respective separate interests.
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d).
(e) Notwithstanding any other provision of this Agreement, (i) any Person who ceases to be a Member shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.
Appears in 2 contracts
Sources: Agreement of Exempted Limited Partnership (WeWork Inc.), Agreement of Exempted Limited Partnership (BowX Acquisition Corp.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Managing Member is hereby designated as the “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning with the taxable year including the Effective Date. In addition, the Managing Member is hereby authorized to designate or remove any other Person selected by the Managing Member as the Partnership Representative. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and that the Managing Member is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Continuing Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company or any of its Subsidiaries the resolution of which would reasonably be expected to have a disproportionate (compared to the Managing Member) and its Subsidiaries; provided, that material adverse effect on the Continuing Members (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Continuing Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Continuing Member Representative (or its designee) to participate (including using separate counsel), in each case at the Continuing Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Continuing Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Continuing Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Continuing Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Managing Member) and material adverse impact effect on the GATX Member or Continuing Members without the Blocker Member (or its Affiliates), then the Requisite Members’ prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Requisite Members (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code (or any analogous provision of state or local Law) or (ii) taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to have a disproportionate (compared to the Managing Member) and Treasury Regulations material adverse effect on the Continuing Members, in the case of clauses (i) and (ii); provided that no consent from the Requisite Members is required in order to either pay Tax at make an election under Section 6226(a) of the Code with respect to taxable periods that began on or before the Effective Time.
(d) All expenses incurred by the Partnership Representative or Designated Individual in connection with its duties as partnership representative or designated individual, as applicable, shall be expenses of the Company level (including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative or to elect to pass the adjustment through Designated Individual, as applicable, except to the Members (a “Push-Out Election”extent the Partnership Representative or Designated Individual is determined to have performed its duties in the manner described in the final sentence of this Section 5.08(d)), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, and the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, reimburse and each such Member shall take such adjusted items into account as required under indemnify the Partnership Audit Rules Representative or Designated Individual, as applicable, for all such expenses and costs. Nothing herein shall be construed to restrict the Partnership Representative or Designated Individual from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual in discharging its duties hereunder. Neither the Partnership Representative nor Designated Individual shall be liable to the Company, any Member or any Affiliate thereof for any related interestcosts or losses to any Persons, penalty, addition to Tax, any diminution in value or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company liability whatsoever arising as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay performance of its duties pursuant to this Section 8.2(b) by the deadline established by the Board: 5.08 absent (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; willful breach of any provision of this Section 5.08 or (ii) bad faith, fraud, gross negligence or willful misconduct on the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result part of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reasonor Designated Individual, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)applicable.
(e) Notwithstanding any other provision of this AgreementThe Company, (i) any Person who ceases the Partnership Representative, and the Members expressly agree to be a Member shall be treated as a Member for purposes bound by the terms of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.10.03
Appears in 1 contract
Sources: Limited Liability Company Agreement (Highland Transcend Partners I Corp.)
Partnership Representative. Unless otherwise determined by the Board, the Manager is hereby designated (a) The Company must designate itself as its own “partnership representative” for purposes of the Partnership Representative Audit Rules and any comparable provisions of state or local income tax laws (the Company “Partnership Representative”). Each Member and its Subsidiaries, and is hereby directed and authorized to the Board must take whatever steps it, in its reasonable discretion, deems such actions as are necessary or desirable to perfect such designation, including filing any forms or documents with the IRS or any other Taxing Authority, taking such other action as may from time to time be required under the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could reasonably be expected to result in a materially adverse impact on the GATX Member or the Blocker Member (or its Affiliates), then the prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned or delayed).
(b) If The Company must appoint an individual who meets the IRS adjusts any items requirements of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”), and if the Company is permitted under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at Section 301.6223-1(b)(2) as the Company level or to elect to pass sole individual through whom the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, and each such Member shall take such adjusted items into account as required Partnership Representative will act for all purposes under the Partnership Audit Rules and shall be liable for any related interestcomparable provisions of state or local income tax laws (the “Designated Individual”), penalty, addition to Tax, or additional amounts. Any and each Member that fails to (and the Board) must take such adjusted items into account actions as required by are necessary to perfect such designation. The Board may replace the immediately preceding sentence shall indemnify Designated Individual in accordance with applicable laws, rules, and hold harmless regulations. Without approval of the Board, no Person may take any action to cause the Company against any Tax collected by any Taxing Authority from to elect into the Company as a result of the Member’s failurePartnership Audit Rules where such rules would not otherwise be mandatory. In the event a Member (or former Member) fails to pay any amount it The initial Designated Individual is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages)B▇▇▇▇ ▇▇▇▇▇▇.
(c) In any case where an adjustment The Company will have all of Company taxable incomethe rights, gainpowers, lossobligations and duties of a “partnership representative” and the Designated Individual will have all of the rights, deduction or credit for powers, obligations and duties of a Review Year results “designated individual,” each as set forth in the payment of Tax by Partnership Audit Rules. Notwithstanding the previous sentence, the Designated Individual must cause the Company (because no Push-Out Election was made to act at, and only at, the direction of the Board. The Designated Individual is, to the fullest extent permitted by law, absolved from all liability for any and all consequences to any current or because no Push-Out Election was available), it is intended former Member resulting from any action that the Members shall bear Designated Individual causes the economic responsibility for Company to take at the payment direction of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit Company must indemnify and reimburse the Designated Individual for all Members who elect reasonable expenses, including legal and accounting fees, claims, liabilities, losses and damages incurred in writing connection with any administrative or judicial proceeding with respect to participate in the “pull-in” procedure under Section 6225(c)(2)(B) tax liability of the Code and Treasury Regulations thereunder (a “Pull-In Election”)Members. Any Member may participate, and no Member shall The payment of such expenses must be obligated to participate, in made before any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure distributions are made to the benefit of or be borne Members under this Agreement and before any discretionary reserves are set aside by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)Board.
(e) Each Member must take all actions that the Board informs it are reasonably necessary to effect a decision of the Board with respect to the Partnership Audit Rules, including without limitation (i) providing any information reasonably requested in connection with any tax audit or related proceeding (which information may be freely disclosed to the Internal Revenue Service or other relevant taxing authorities), (ii) paying all liabilities attributable to such Member as the result of an election under Code Section 6226, (iii) filing any amended returns that the Board determines to be necessary or appropriate to reduce an imputed underpayment under Code Section 6225(c) and/or (iv) paying all liabilities associated with such an amended return. The costs and expenses incurred by a Member in connection with the preceding sentence (other than the Designated Individual in its capacity as such) will not be treated as Company expenses and will not be reimbursed by the Company.
(f) If any tax audit results in the imposition of a tax liability on the Company itself, the Board is authorized to allocate the economic burden of that liability (including interest and penalties) among the Members (including both current and former Members) based upon their interests in the Company for the “Reviewed Year” (as defined in Section 6225(d)(1) of the Code. If requested in writing by the Board, each Member must pay to the Company the amount allocated to it under the preceding sentence within ten (10) Business Days of notice thereof. Such payment (i) may, at the Board’s discretion, be made by withholding distributions that would otherwise be paid to a Member, and (ii) will not be treated as a Capital Contribution for purposes of determining a Member’s Unreturned Capital or any right to distributions hereunder.
(g) Notwithstanding any other provision of this AgreementAgreement to the contrary, (ieach Member agrees that its obligations to comply with this Section 10.7.2(g) will survive any transfer of its Membership Interest and the dissolution of the Company. Accordingly, each Person who that ceases to be a Member shall will, notwithstanding such divestiture, reimburse and indemnify the Company against any liability that would be treated as allocated to such Person under Section 10.7.2(f) if the Person were a Member for purposes at the time of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Companydetermination.
Appears in 1 contract
Sources: Limited Liability Company Agreement (Vinco Ventures, Inc.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Original Member Representative is hereby designated as the Company’s “tax matters partner” for U.S. federal income tax purposes under Section 6231(a)(7) of the Code, as in effect for taxable years of the Company beginning on or before December 31, 2017, and as the Company’s “partnership representative” as that term is defined in pursuant to Section 6223(a) of the Code for taxable years of the Company beginning after December 31, 2017 and ending prior to January 1, 2022. The Managing Member is hereby designated as the “partnership representative” pursuant to Section 6223(a) of the Code for taxable years beginning on or after January 1, 2022. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint the “designated individual” identified by the Partnership Representative and approved by the Board to act on its behalf in accordance with the applicable Regulations or analogous provisions of state or local law. Each Member hereby expressly consents to such designations and agrees to take, and that the Managing Member is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Regulations or other Internal Revenue Service or Treasury guidance or state or local law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 10.3, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe BBA Rules, including filing making any forms elections under the BBA Rules or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any Action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Original Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and or any of its Subsidiaries; provided, that the Subsidiaries (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Original Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Member Representative (or its designee) to participate (including using separate counsel), in each case at the Original Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Original Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable laws) or a final partnership adjustmentdecision of a court or IRS Appeals panel (or equivalent body under applicable laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Original Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Original Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to PubCo) and material adverse impact effect on the GATX Original Members without the Original Member or the Blocker Member (or its Affiliates), then the Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
(b) If . The Partnership Representative shall obtain the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”), and if the Company is permitted under Section 6226(a) prior written consent of the Code and Treasury Regulations to either pay Tax at the Company level Original Member Representative (which consent shall not be unreasonably withheld, delayed or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, and each such Member shall take such adjusted items into account as required conditioned) before taking any material action under the Partnership Audit BBA Rules that would reasonably be expected to have a disproportionate (compared to PubCo) and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by material adverse effect on the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages)Original Members.
(d) The Partnership Representative shall permit all Members who elect Notwithstanding anything to the contrary contained in writing to participate this Agreement, in the “pull-in” procedure under event of any conflict between Section 6225(c)(2)(B) 7.1 of the Code Business Combination Agreement and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participatethis Agreement, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) 7.1 of the Code nor prevent any Member from doing soBusiness Combination Agreement shall control. The Company, the Partnership Representative, the Managing Member, and the Partnership Representative shall take all actions reasonably necessary Members hereby acknowledge and agree to effectuate any determination the foregoing sentence and expressly agree to be bound by the terms of any Member pursuant to this Section 8.2(d)7.1 of the Business Combination Agreement.
(e) Notwithstanding any other provision This Section 10.3 shall be interpreted to apply to Members and former Members and shall survive the Transfer of a Member’s Company Units and the termination, dissolution, liquidation and winding up of the Company and, for this Agreementpurpose to the extent not prohibited by applicable law, (i) any Person who ceases to be a Member the Company shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Companycontinuing in existence.
Appears in 1 contract
Sources: Operating Agreement (Biote Corp.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The General Partner is hereby designated as the Partnership Representative. In addition, the General Partner is hereby authorized to designate or remove any other Person selected by General Partner as the Partnership Representative; provided that all actions taken by the Partnership Representative pursuant to this Section 9.3 shall be subject to the overall oversight and authority of the Company Board. For each Fiscal Year in which the Partnership Representative is an entity, the Partnership shall appoint the "designated individual" identified by the Partnership Representative and approved by the Board to act on its Subsidiariesbehalf in accordance with the applicable Regulations or analogous provisions of state or local Law. Each Partner hereby expressly consents to such designations and agrees to take, and that the General Partner is hereby directed and authorized to take whatever steps it(or cause the Partnership to take), in its reasonable discretion, deems such other actions as may be necessary or desirable advisable pursuant to perfect Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designationdesignations or evidence such Partner's consent to such designations.
(b) Subject to this Section 9.3, the Partnership Representative shall have the sole authority to act on behalf of the Partnership in connection with, make all relevant decisions regarding application of, and to exercise the rights and powers provided for in the BBA Rules, including filing making any forms elections under the BBA Rules or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any Action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an "Audit"), and to expend Partnership funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate give prompt written notice to the individual to serve as Original Limited Partner Representative of the Designated Individual and such Designated Individual shall be subject to replacement by commencement of any Audit of the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2its Subsidiaries (a "Specified Audit"). Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the The Partnership Representative shall (i) diligently conduct keep the Original Limited Partner Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Limited Partner Representative (or its designee) to participate (including using separate counsel), in each case at the Original Limited Partners' sole cost and expense, in any such Specified Audit, and (iii) promptly notify each Member in writing (1) the Original Limited Partner Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Partnership shall promptly provide the Original Limited Partner Representative with copies of all material correspondence between the Partnership Representative or the Partnership (as applicable) and any Governmental Entity in connection with such Specified Audit and shall give the Original Limited Partner Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Partnership shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Special Limited Partner) and material adverse impact effect on the GATX Member or Original Limited Partners without the Blocker Member (or its Affiliates), then the Original Limited Partner Representative's prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Original Limited Partner Representative (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level (or to elect to pass the adjustment through to the Members any analogous provision of state or local Law) (a “"Push-Out Election”)") or (ii) taking any material action under the BBA Rules that would reasonably be expected to have a disproportionate (compared to the Special Limited Partner) and material adverse effect on the Original Limited Partners, the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice case of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: clauses (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; and (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect Notwithstanding anything to the contrary contained in writing to participate this Agreement, in the “pull-in” procedure under event of any conflict between Section 6225(c)(2)(B) 9.1 of the Code Business Combination Agreement and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participatethis Agreement, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) 9.1 of the Code nor prevent any Member from doing soBusiness Combination Agreement shall control. The Partnership, the Partnership Representative, the General Partner, and the Partnership Representative shall take all actions reasonably necessary Partners hereby acknowledge and agree to effectuate any determination the foregoing sentence and expressly agree to be bound by the terms of any Member pursuant to this Section 8.2(d)9.1 of the Business Combination Agreement.
(e) Notwithstanding any other provision This Section 9.3 shall be interpreted to apply to Partners and former Partners and shall survive the Transfer of a Partner's Partnership Units and the termination, dissolution, liquidation and winding up of the Partnership and, for this Agreementpurpose to the extent not prohibited by applicable Law, (i) any Person who ceases to be a Member the Partnership shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Companycontinuing in existence.
Appears in 1 contract
Sources: Business Combination Agreement (dMY Technology Group, Inc.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) PubCo is hereby designated as the “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning with the taxable year including the Effective Date. In addition, the OpCo Board is hereby authorized to designate or remove any other Person selected by the OpCo Board as the Partnership Representative. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and that the OpCo Board is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Continuing Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company or any of its Subsidiaries the resolution of which would reasonably be expected to have a disproportionate (compared to PubCo) and its Subsidiaries; provided, that material adverse effect on the Continuing Members (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Continuing Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Continuing Member Representative (or its designee) to participate (including using separate counsel), in each case at the Continuing Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Continuing Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Continuing Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Continuing Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to PubCo) and material adverse impact effect on the GATX Member or Continuing Members without the Blocker Member (or its Affiliates), then the Requisite Continuing Members’ prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Requisite Continuing Members (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code (or any analogous provision of state or local Law) or (ii) taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to have a disproportionate (compared to PubCo) and Treasury Regulations material adverse effect on the Continuing Members, in the case of clauses (i) and (ii); provided that, no consent from the Requisite Continuing Members is required in order to either pay Tax at make an election under Section 6226(a) of the Code with respect to taxable periods that began on or before the Effective Time.
(d) All expenses incurred by the Partnership Representative or Designated Individual in connection with its duties as partnership representative or designated individual, as applicable, shall be expenses of the Company level (including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative or to elect to pass the adjustment through Designated Individual, as applicable, except to the Members (a “Push-Out Election”extent the Partnership Representative or Designated Individual is determined to have performed its duties in the manner described in the final sentence of this Section 5.08(d)), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, and the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, reimburse and each such Member shall take such adjusted items into account as required under indemnify the Partnership Audit Rules Representative or Designated Individual, as applicable, for all such expenses and costs. Nothing herein shall be construed to restrict the Partnership Representative or Designated Individual from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual in discharging its duties hereunder. Neither the Partnership Representative nor Designated Individual shall be liable to the Company, any Member or any Affiliate thereof for any related interestcosts or losses to any Persons, penalty, addition to Tax, any diminution in value or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company liability whatsoever arising as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay performance of its duties pursuant to this Section 8.2(b) by the deadline established by the Board: 5.08 absent (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; willful breach of any provision of this Section 5.08 or (ii) bad faith, fraud, gross negligence or willful misconduct on the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result part of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reasonor Designated Individual, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)applicable.
(e) Notwithstanding any other provision of this AgreementThe Company, (i) any Person who ceases the Partnership Representative, and the Members expressly agree to be a Member shall be treated as a Member for purposes bound by the terms of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.10.03
Appears in 1 contract
Sources: Agreement and Plan of Merger (Highland Transcend Partners I Corp.)
Partnership Representative. Unless otherwise determined by (a) J▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ shall be the Board, the Manager is hereby designated the Partnership Representative partnership representative of the Company and its Subsidiaries, and is hereby directed and authorized pursuant to take whatever steps it, in its reasonable discretion, deems necessary or desirable to perfect such designation, including filing any forms or documents with Section 6223(a) of the IRS or any other Taxing Authority, taking such other action as may from time to time be required under Code (the Treasury Regulations and directing “Partnership Representative”) provided that the Board to take or approve may change the “partnership representative” at any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulationstime. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority Internal Revenue Service shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules9.4.
(ab) Subject to Notwithstanding any other provision of this Section 6.19.4, the Partnership Representative shall be inform the Members of all significant matters that may come to its attention in its capacity as Partnership Representative by giving notice thereof within ten days after becoming aware thereof and, within such time, shall forward to each Member copies of all significant written communications it may receive in such capacity. The Partnership Representative is authorized and required to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters represent the Company (at the Company’s expense) in connection with all examinations of the Company’s affairs by any federal, state, local or foreign taxing authority, including resulting administrative and judicial proceedings, and to expend Company funds for professional services and its Subsidiariescosts associated therewith; provided, however, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) not extend the statute of the commencement of limitations or settle any tax audit, examination, proposed adjustment or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed on behalf of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with Company without the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” within the meaning of Section 6223(a) approval of the Code could reasonably be expected to result in a materially adverse impact on the GATX Member or the Blocker Member (or its Affiliates)Members, then the prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent approval shall not be unreasonably withheld, conditioned delayed or delayedconditioned. Unless otherwise approved by the Members, the Partnership Representative shall, if permitted under Section 6221(b), cause the Company to elect out of the provisions of the federal income tax partnership audit rules on an annual basis.
(bc) If In the IRS adjusts event the Company is liable for any imputed underpayment with respect to items of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”)credit, and if the Partnership Representative shall, at the election of the Class B Members, cause the Company is permitted to make the election under Section 6226(a) 6226 of the Code and Treasury Regulations to either pay Tax at in the Company level or to elect to pass manner provided by the adjustment through to Internal Revenue Service within 45 days after the Members (date of the notice of a “Push-Out Election”)final partnership adjustment. Upon making such election, the Board Partnership Representative shall determine whether engage a certified public accountant or tax attorney (on behalf of the Company) to make assist the Partnership Representative in determining in a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to reasonable manner each Member a statement reflecting the Member’s share of the adjusted items as determined set forth in the written notice of final partnership adjustment, and each such Member shall take such adjusted items adjustment into account as required under Section 6226(b) of the Partnership Audit Rules Code and shall be liable for any related related, income tax, interest, penalty, addition to Tax, penalty or additional amountsamount. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result If an election under Section 6226 of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it Code is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was not made or because no Push-Out Election was available), it such election is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reasonineffective, and the Company is held directly liable for any additional income Taxtax, interest, penalty or additional amounts amount under the Code or other applicable Law law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returnsincome tax returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant or tax attorney engaged by the Partnership Representative on behalf of the Company) of any additional Taxtax, interest, penalty and additional amounts due amount penalty due.
(taking into account d) Each Member will provide such cooperation and assistance, including executing and filing forms or other statements and providing information about such Member, as is reasonably requested by the effect Partnership Representative to enable the Company to satisfy any applicable tax reporting or compliance requirements, to make any tax election or to qualify for an exception from or reduced rate of tax or other tax benefit or be relieved of liability for any Pull-In Election made by any tax regardless of whether such requirement, tax benefit or tax liability existed on the date such Member pursuant was admitted to Section 8.2(d))the Company. If a Person who was a Member of fails to provide any such forms, statements, or other information requested by the Company in the Review Year has withdrawn from the CompanyPartnership Representative, such former Member shall remain obligated will be required to indemnify the Company and pay for the other Members for such former Member’s proportionate share of the Tax, penalties and interest any tax deficiency paid or payable by the Company with respect that is due to the Review Year. In the event a Member such failure (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate as reasonably determined by the Board; Partnership Representative). Any deficiency for taxes imposed on any Member (ii) the Board may reduce subsequent distributions including penalties, additions to tax or interest imposed with respect to such Member by such amount; taxes, and (iii) such Member (or former Memberany taxes imposed pursuant to Code Section 6226) shall be liable paid by such Member and if required to be paid (and actually paid) by the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participateCompany, and no Member shall will be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to recoverable from such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d).
(e) Notwithstanding any other provision of this Agreement, (i) any Person who ceases to be a Member shall be treated as a Member for purposes of this Section 8.2 and (ii) the obligations of Any amounts payable by a Member pursuant to this Section 8.2 9.4 shall bear interest as further set forth in Section 9.5.
(e) Any amounts paid to the Company by a Member pursuant to this Section 9.4 shall not be treated as a Capital Contribution for purposes of this Agreement. Any amounts paid by the Company on behalf of a Member that are not otherwise reimbursed by a Member shall constitute a distribution to such Member. Any payment made by the Company on behalf of the Members and for which reimbursement is not otherwise sought pursuant to this Section 9.4 shall be at the discretion of the Board. The Board may cause such allocations to be made among the Members as necessary to reflect any items of income or loss associated with the payment of a Company liability as set forth in this Section 9.4.
(f) Each Member shall remain bound by the provisions of this Section 9.4, and all obligations hereunder, which shall survive any redemption or Transfer the termination, dissolution, liquidation and winding up of the Company and such Member’s ceasing to be a Membership Interest and the termination of this Agreement or the dissolution member of the Company. For purposes of this Section 9.4, the use of the term “Member” or “Members” shall include former Members.
Appears in 1 contract
Sources: Limited Liability Company Agreement (Royale Energy, Inc.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ is hereby designated the Partnership Representative of the Company and its Subsidiaries, and is hereby directed and authorized to take whatever steps it, in its reasonable discretion, deems necessary or desirable to perfect such designation, including filing any forms or documents with the IRS or any other Taxing Authority, taking such other action as may from time to time be required under the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a Company’s “partnership representative” within the meaning of Section 6223(a) 6223 of the Code could reasonably be expected for each taxable year of the Company, or under similar state or local Law (as applicable, the “Partnership Representative”). In addition, FA Acquisition is hereby authorized to result designate or remove any other Person selected by FA Acquisition as the Partnership Representative. For each Fiscal Year in a materially adverse impact which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with applicable Treasury Regulations or analogous provisions of state or local Law. References in this Agreement to the Partnership Representative shall include the Designated Individual. Actions taken by the Designated Individual shall have binding effect on the GATX Members and the Company just as if such actions were taken by the Partnership Representative. Each Member or hereby expressly consents to such designations and agrees to take, and that the Blocker Member Partnership Representative is authorized to take (or its Affiliatescause the Company to take), then such other actions as may be necessary or advisable pursuant to the prior written consent Treasury Regulations or other IRS or U.S. Department of the GATX Member Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations. The Partnership Representative shall consult with Aztec and Fernweh in good faith in exercising its authority as Partnership Representative including appointing the Blocker MemberDesignated Individual.
(b) Subject to this Section 4.09, the Partnership Representative shall have the sole authority to act on behalf of the Company in connection with, make all relevant decisions regarding application of, and to exercise the rights and powers provided for in the Revised Partnership Audit Provisions, including making any elections under the Revised Partnership Audit Provisions or any decisions to settle, compromise, challenge, litigate, or otherwise alter the defense of any action, audit, or examination before the IRS or any other tax authority (each, an “Audit”), and to expend Company funds for professional services and other expenses reasonably incurred in connection therewith.
(c) All expenses incurred by the Partnership Representative in connection with its duties as partnership representative or designated individual, as applicable, shall be required expenses of the Company (which consent including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative), and the Company shall reimburse and indemnify the Partnership Representative for all such expenses and costs. Nothing herein shall be construed to restrict the Partnership Representative from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual in discharging its duties hereunder. The Partnership Representative shall not be unreasonably withheldliable to the Company, conditioned any Member, or delayed)any Affiliate thereof for any costs or losses to any Persons, any diminution in value, or any liability whatsoever arising as a result of the performance of its duties pursuant to this Section 4.09 absent intentional fraud or intentional misconduct on the part of the Partnership Representative.
(bd) If the IRS adjusts any items Each Member agrees that such Member will not independently act with respect to tax audits or tax litigation of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”), and if the Company is permitted for any taxable period for which the Partnership Representative has authority, unless previously authorized to do so in writing by the Partnership Representative, which authorization may be withheld by the Partnership Representative. The Partnership Representative, in consultation with the Board of Directors, shall determine whether the Company (either on its own behalf or on behalf of the Members) will contest or continue to contest any tax deficiencies assessed or proposed to be assessed by any tax authority for any such taxable period. The Partnership Representative shall provide notice to the Principal Members of (i) the commencement of any examination or audit by any Governmental Authority of any tax return of the Company and (ii) the receipt of any Internal Revenue Service notice of a final partnership adjustment; provided, however, that the failure to provide such notice shall not in any way limit or change the Members’ obligations, or the Partnership Representative’s rights and authority, hereunder.
(e) Each Member shall cooperate with all requests for information that the Partnership Representative, in its reasonable discretion, deems necessary to comply with the Code, including information requests needed to appropriately determine a share of a Member’s liability arising under an audit. In the event of an audit of the Company, the Partnership Representative shall have the right to make any and all elections and to take any actions that are available to be made or taken by the Partnership Representative or the Company; provided that no Member shall be required to file an amended tax return without such Member’s prior written consent. If an election under Code Section 6226(a) of the Code and Treasury Regulations is made with respect to either pay Tax at the Company level or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is madean Imputed Underpayment, the Company shall furnish to each Member for the year under audit a statement reflecting of the Member’s share of the adjusted items as determined any such Imputed Underpayment set forth in the written notice of final partnership adjustment, and each such Member shall take such adjusted items adjustment into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result Section 6226(b) of the Member’s failureCode. In the event there is an Imputed Underpayment for which an election under Section 6226(a) of the Code is not made and a Member (or former Member) fails affected by the Imputed Underpayment elects to file an amended tax return that takes into account the full amount of any adjustments and pay any additional tax due in connection with such amended tax return that are attributable to such Member, as determined by the Partnership Representative (a “Section 6225(c) Filing”), then those Members that do not make a Section 6225(c) Filing shall (x) contribute an amount it is obligated equal to pay their share of the Imputed Underpayment to the Company (a “Direct Payment”), and such amount shall not be treated as a capital contribution within the meaning of this Agreement, or (y) have an amount equal to their share of the Imputed Underpayment withheld from distributions to such Member pursuant to this Section 8.2(b6.2 or Section 6.3 (a “Distribution Withholding”). The Members generally intend for the Partnership Representative to choose a Distribution Withholding for the Members (but not for former Members) by the deadline established by the Boardif: (i) the unpaid amount shall accrue interest at a rate reasonably determined by Company has sufficient distributable cash to pay the Board; applicable taxes (which distributable cash would otherwise be distributable to such responsible Members) and (ii) treating the Board may reduce subsequent distributions taxes allocated to such a Member by such amount; as a distribution will not violate any Law or any contract with any third party (including any credit agreement). Notwithstanding the foregoing, if the Partnership Representative elects Direct Payment and (iii) such Member (or former Member) shall be liable to the Company for pays any costs and damages incurred Member’s share of an Imputed Underpayment as a result of the delay in payment (without regard a Member’s failure to whether contribute money to the Company could have mitigated any in furtherance of the Partnership Representative’s request, such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by Member shall on demand reimburse the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment amount of the Tax, penalty and interest Member’s share of the Imputed Underpayment paid by the Company in proportion to plus interest thereon at the manner in rate of 8% per annum, compounded quarterly on the first day of each calendar quarter, from and after the date on which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Yearhas given notice to such Member that it has made a payment on its behalf. If the Partnership Representative does not make a Push-Out Election for any reason, In addition to all other rights and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member remedies of the Company at law or in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company equity with respect to the Review Year. In the event amounts owed by a Member (or former Member) fails to pay any amount it is obligated to pay the Company pursuant to this Section 8.2(c) by 4.09(e), the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require offset, or cause to be offset, against any such Member’s distributions under this Agreement all amounts owed by such Member to amend a Tax Return the Company pursuant to this Section 6225(c)(2) of the Code nor prevent any Member from doing so4.09(e), and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination promptly send written notice of any such offset to such Member pursuant to this Section 8.2(d)so indicating and specifying the amount offset. A Member’s share of an Imputed Underpayment shall reasonably be determined by the Partnership Representative.
(ef) The Company, the Partnership Representative, and the Members expressly agree to be bound by the terms of Section 5.7 of the Transaction Agreement. Notwithstanding any other provision of anything to the contrary contained in this Agreement, (i) in the event of any Person who ceases to be a Member shall be treated as a Member for purposes of this conflict between Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution 5.7 of the CompanyTransaction Agreement and this Agreement, Section 5.7 of the Transaction Agreement shall control.
Appears in 1 contract
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) PubCo is hereby designated as the “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning with the taxable year including the Effective Date. In addition, the OpCo Board is hereby authorized to designate or remove any Person selected by the OpCo Board as the Partnership Representative. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and consents to the OpCo Board being authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Continuing Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and or any of its Subsidiaries; provided, that Subsidiaries the resolution of which would reasonably be expected to have a material adverse effect on the Continuing Members (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Continuing Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Continuing Member Representative (or its designee) to participate (including using separate counsel), in each case at the Continuing Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Continuing Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Continuing Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Continuing Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to PubCo) and material adverse impact effect on the GATX Member or Continuing Members without the Blocker Member (or its Affiliates), then the Requisite Continuing Members’ prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Requisite Continuing Members (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code (or any analogous provision of state or local Law) or (ii) taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to have a disproportionate (compared to PubCo) and Treasury Regulations material adverse effect on the Continuing Members, in the case of clauses (i) and (ii); provided that, no consent from the Requisite Continuing Members is required in order to either pay Tax at make an election under Section 6226(a) of the Code with respect to taxable periods that began on or before the Business Combination Effective Date.
(d) All expenses incurred by the Partnership Representative or Designated Individual in connection with its duties as partnership representative or designated individual, as applicable, shall be expenses of the Company level (including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative or to elect to pass the adjustment through Designated Individual, as applicable, except to the Members extent the Partnership Representative or Designated Individual is determined to have performed its duties in the manner described in clauses (a “Push-Out Election”i) and (ii) of the final sentence of this Section 5.08(d)), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, and the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, reimburse and each such Member shall take such adjusted items into account as required under indemnify the Partnership Audit Rules Representative or Designated Individual, as applicable, for all such expenses and costs. Nothing herein shall be construed to restrict the Partnership Representative or Designated Individual from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual in discharging its duties hereunder. Neither the Partnership Representative nor Designated Individual shall be liable to the Company, any Member or any Affiliate thereof for any related interestcosts or losses to any Persons, penalty, addition to Tax, any diminution in value or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company liability whatsoever arising as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay performance of its duties pursuant to this Section 8.2(b) by the deadline established by the Board: 5.08 absent (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; willful breach of any provision of this Section 5.08 or (ii) bad faith, fraud, gross negligence or willful misconduct on the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result part of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reasonor Designated Individual, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)applicable.
(e) The Company, the Partnership Representative, and the Members expressly agree to be bound by the terms of Section 7.6 of the Business Combination Agreement (with any references to PKLP or PKLP’s organization documents being deemed to refer to the Company and its organizational documents). Notwithstanding any other provision of anything to the contrary contained in this Agreement, (i) in the event of any Person who ceases to be a Member shall be treated as a Member for purposes of this conflict between Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution 7.6 of the CompanyBusiness Combination Agreement and this Agreement, Section 7.6 of the Business Combination Agreement shall control.
Appears in 1 contract
Sources: Limited Liability Company Agreement (Prokidney Corp.)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Original Member Representative is hereby designated as (and, if not already appointed, the Company shall appoint the Original Member Representative as) the Company’s “partnership representative” as that term is defined in the Revised Partnership Audit Provisions for taxable years of the Company beginning after December 31, 2017 and ending on or prior to December 31, 2022. The Managing Member is hereby authorized to designate (and the Company shall appoint the Person so designated) the Company’s “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning on or after January 1, 2023. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable Treasury Regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and that each of the Company and its Subsidiaries, and the Managing Member is hereby directed and authorized to take whatever steps it(or cause the Company to take), in its reasonable discretion, deems such other actions as may be necessary or desirable advisable pursuant to perfect Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designationdesignations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company in connection with, make all relevant decisions regarding application of, and to exercise the rights and powers provided for in the Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authorityincome tax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time expenses reasonably incurred in connection therewith. Notwithstanding the foregoing or anything to time the contrary in this Agreement, with respect to any “imputed underpayment” arising in connection with any Audit relating to any taxable year for which the Original Member Representative is the Partnership Representative, at the election of the Managing Member (in its reasonable discretion), the Original Member Representative shall be required to make (or cause to be made) an election under the Treasury Regulations and directing the Board to take or approve any Section 6226(a) of the foregoing actions. If a Designated Individual is required to be appointed under Code (or any analogous provision of state or local Law).
(c) Without limiting the Partnership Audit Rulesforegoing, the Partnership Representative shall designate give prompt written notice to the individual Original Member Representative of the commencement of any Audit of the Company or any of its Subsidiaries the resolution of which would reasonably be expected to serve as have a disproportionate (compared to the Designated Individual Managing Member) and material adverse effect on the Original Members. The Partnership Representative shall keep the Original Member Representative reasonably informed of the material developments and status of any such Designated Individual Audit for taxable years beginning on or after January 1, 2022 (a “Specified Audit”), (i) permit the Original Member Representative (or its designee) to participate (including using separate counsel), in each case at the Original Members’ sole cost and expense, in any such Specified Audit to the maximum extent permitted by the applicable tax authority, and (ii) promptly notify the Original Member Representative of receipt of a notice of a final partnership adjustment (or equivalent under applicable Laws) or a final decision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall be subject to replacement by promptly provide the Original Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in accordance connection with such Specified Audit and shall give the Code Original Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (including settlement or compromise offers) or filing in connection with any such Specified Audit. Additionally, without limiting the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject to the requirements and obligations of, the Partnership Representative for purposes final sentence of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.15.08(c), the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of not (and the Company shall not (and its Subsidiaries; provided, that shall not authorize the Partnership Representative shall (ito)) diligently conduct settle, compromise or abandon any such proceedings Specified Audit in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Managing Member) and material adverse impact effect on the GATX Original Members without the Original Member or the Blocker Member (or its Affiliates), then the Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
(b) If . Without limiting the IRS adjusts any items final sentence of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”this Section 5.08(c), the Partnership Representative shall obtain the prior written consent of the Original Member Representative (which consent shall not be unreasonably withheld, delayed or conditioned) before taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to have a disproportionate (compared to the Managing Member) and if material adverse effect on the Company is permitted Original Members. Notwithstanding the foregoing, (i) each of the obligations of the Partnership Representative and the Company, and rights of the Original Member Representative and Original Members, under this Section 5.08(c) shall terminate and have no further force or effect from and after the date that the Original Members no longer own 20% of the combined Class A Units and Class B Units, and (ii) with respect to any “imputed underpayment” arising in connection with any Audit, at the election of the Managing Member (in its reasonable discretion), the Partnership Representative shall be required to make (or cause to be made) an election under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (analogous provision of state or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damageslocal Law).
(cd) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in To the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended extent that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election an election under Code Section 6226(a) for any reasontaxable year, the Company shall use commercially reasonable efforts to make any modifications available under Code Section 6225(c)(3), (4), and (5), to the extent such modification would reduce any taxes payable by the Company. Each Member agrees to cooperate with the Partnership Representative and to do or refrain from doing any or all things reasonably requested by the Partnership Representative with respect to the conduct of examinations under the Revised Partnership Audit Provisions; provided, that a Member shall not be required to file an amended federal income tax return, as described in Code Section 6225(c)(2)(A). The provisions of this Section 5.08(d) shall survive the termination of any Member’s interest in the Company, the termination of this Agreement and the termination of the Company and shall remain binding on each Member.
(e) To the extent there are provisions of any applicable state or local tax laws that are similar to the Revised Partnership Audit Provisions, the Members agree to follow procedures similar to those described in this Section 5.08 with respect to such state and local tax laws.
(f) All expenses incurred by the Partnership Representative or Designated Individual in connection with its duties as partnership representative or designated individual, as applicable, shall be expenses of the Company (including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative or Designated Individual, as applicable), and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by reimburse and indemnify the Partnership Representative on behalf of or Designated Individual, as applicable, for all such expenses and costs. Nothing herein shall be construed to restrict the Company) of any additional TaxPartnership Representative or Designated Individual from engaging lawyers, interestaccountants, penalty and additional amounts due (taking into account tax advisers, or other professional advisers or experts to assist the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d))Partnership Representative or Designated Individual in discharging its duties hereunder. If a Person who was a Member of Neither the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) Partnership Representative nor Designated Individual shall be liable to the Company Company, any Member or any Affiliate thereof for any costs and damages incurred or losses to any Persons, any diminution in value or any liability whatsoever arising as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) performance of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member its duties pursuant to this Section 8.2(d).
5.08 absent (ei) Notwithstanding willful breach of any other provision of this Agreement, (i) any Person who ceases to be a Member shall be treated as a Member for purposes of this Section 8.2 and 5.08 or (ii) bad faith, fraud, or willful misconduct on the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution part of the CompanyPartnership Representative or Designated Individual, as applicable.
Appears in 1 contract
Sources: Business Combination Agreement (Spree Acquisition Corp. 1 LTD)
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Original Member Representative is hereby designated as the Company’s “tax matters partner” for U.S. federal income tax purposes under Section 6231(a)(7) of the Code, as in effect for taxable years of the Company beginning on or before December 31, 2017, and as the Company’s “partnership representative” as that term is defined in the Revised Partnership Audit Provisions for taxable years of the Company beginning after December 31, 2017 and ending prior to January 1, 2021. The Managing Member is hereby designated as the “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning on or after January 1, 2021. In addition, the Managing Member is hereby authorized to designate or remove any other Person selected by the Managing Member as the Partnership Representative. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable Regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and that the Managing Member is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Original Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company or any of its Subsidiaries the resolution of which would reasonably be expected to have a disproportionate (compared to the Managing Member) and its Subsidiaries; provided, that material adverse effect on the Original Members (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Original Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Member Representative (or its designee) to participate (including using separate counsel), in each case at the Original Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Original Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Original Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Original Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Managing Member) and material adverse impact effect on the GATX Original Members without the Original Member or the Blocker Member (or its Affiliates), then the Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall obtain the prior written consent of the Original Member Representative (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code and Treasury Regulations (or any analogous provision of state or local Law) or (ii) taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to either pay Tax at the Company level or to elect to pass the adjustment through have a disproportionate (compared to the Members (a “Push-Out Election”)Managing Member) and material adverse effect on the Original Members, the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice case of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: clauses (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; and (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The All expenses incurred by the Partnership Representative or Designated Individual in connection with its duties as partnership representative or designated individual, as applicable, shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) be expenses of the Code Company (including, for the avoidance of doubt, any costs and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participateexpenses incurred in connection with any claims asserted against the Partnership Representative or Designated Individual, and no Member shall be obligated to participateas applicable, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure except to the extent attributable the Partnership Representative or Designated Individual is determined to such Member. No Person shall have performed its duties in the right to require any Member to amend a Tax Return pursuant to manner described in the final sentence of this Section 6225(c)(2) of the Code nor prevent any Member from doing so5.08(d)), and the Company shall reimburse and indemnify the Partnership Representative or Designated Individual, as applicable, for all such expenses and costs. Nothing herein shall take all actions reasonably necessary be construed to effectuate any determination of restrict the Partnership Representative or Designated Individual from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual in discharging its duties hereunder. Neither the Partnership Representative nor Designated Individual shall be liable to the Company, any Member or any Affiliate thereof for any costs or losses to any Persons, any diminution in value or any liability whatsoever arising as a result of the performance of its duties pursuant to this Section 8.2(d)5.08 absent (i) willful breach of any provision of this Section 5.08 or (ii) bad faith, fraud, gross negligence or willful misconduct on the part of the Partnership Representative or Designated Individual, as applicable.
(e) Notwithstanding any other provision of this AgreementThe Company, (i) any Person who ceases the Partnership Representative, and the Members expressly agree to be a Member shall be treated as a Member for purposes bound by the terms of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.9.04
Appears in 1 contract
Partnership Representative. Unless otherwise determined by the Board, the Manager (a) The Managing Member is hereby designated as the “partnership representative” as that term is defined in Revised Partnership Audit Provisions for taxable years of the Company beginning with the taxable year including the Effective Date. In addition, the Managing Member is hereby authorized to designate or remove any other Person selected by the Managing Member as the Partnership Representative. For each Fiscal Year in which the Partnership Representative is an entity, the Company shall appoint an individual identified by the Partnership Representative for such Fiscal Year to act on its behalf (the “Designated Individual”) in accordance with the applicable regulations or analogous provisions of state or local Law. Each Member hereby expressly consents to such designations and agrees to take, and the Managing Member is authorized to take (or cause the Company to take), such other actions as may be necessary or advisable pursuant to Treasury Regulations or other Internal Revenue Service or Treasury guidance or state or local Law to cause such designations or evidence such Member’s consent to such designations.
(b) Subject to this Section 5.08, the Partnership Representative shall have the sole authority to act on behalf of the Company and its Subsidiariesin connection with, make all relevant decisions regarding application of, and is hereby directed to exercise the rights and authorized to take whatever steps it, powers provided for in its reasonable discretion, deems necessary or desirable to perfect such designationthe Revised Partnership Audit Provisions, including filing making any forms elections under the Revised Partnership Audit Provisions or documents with any decisions to settle, compromise, challenge, litigate or otherwise alter the defense of any action, audit or examination before the IRS or any other Taxing Authoritytax authority (each, taking such an “Audit”), and to expend Company funds for professional services and other action as may from time to time be required under expenses reasonably incurred in connection therewith.
(c) Without limiting the Treasury Regulations and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rulesforegoing, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject give prompt written notice to the requirements and obligations of, Original Member Representative of the Partnership Representative for purposes commencement of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership any Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company or any of its Subsidiaries the resolution of which would reasonably be expected to have a disproportionate (compared to the Managing Member) and its Subsidiaries; provided, that material adverse effect on the Original Members (a “Specified Audit”). The Partnership Representative shall (i) diligently conduct keep the Original Member Representative reasonably informed of the material developments and status of any such proceedings in good faithSpecified Audit, (ii) permit the Original Member Representative (or its designee) to participate (including using separate counsel), in each case at the Original Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each the Original Member in writing (1) Representative of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of a final partnership administrative adjustment (or equivalent under applicable Laws) or a final partnership adjustmentdecision of a court or IRS Independent Office of Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Partnership Representative or the Company shall promptly provide the Original Member Representative with copies of all material correspondence between the Partnership Representative or the Company (as applicable) and any governmental entity in connection with such Specified Audit and shall give the Original Member Representative a reasonable opportunity to review and comment on any material correspondence, submission (iiiincluding settlement or compromise offers) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member filing in connection with any auditssuch Specified Audit. Additionally, examinations or other administrative or judicial proceedings about strategy and give such Members for so long as the opportunity (Original Member Representative owns at least 50% of the sole cost and expense of such Members) to attend any scheduled meetings with Units owned by the Taxing Authority in such auditOriginal Member Representative immediately following the Closing Date, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative shall not (and the Company shall not (and shall not authorize the Partnership Representative to)) settle, compromise or abandon any Specified Audit in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could manner that would reasonably be expected to result in have a materially disproportionate (compared to the Managing Member) and material adverse impact effect on the GATX Original Members without the Original Member or the Blocker Member (or its Affiliates), then the Representative’s prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned delayed or delayedconditioned).
. The Partnership Representative shall, for so long as the Original Member Representative owns at least 50% of the Units owned by the Original Member Representative immediately following the Closing Date, obtain the prior written consent of the Original Member Representative (bwhich consent shall not be unreasonably withheld, delayed or conditioned) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year before (a “Review Year”), and if the Company is permitted i) making an election under Section 6226(a) of the Code (or any analogous provision of state or local Law) or (ii) taking any material action under the Revised Partnership Audit Provisions that would reasonably be expected to have a disproportionate (compared to the Managing Member) and Treasury Regulations material adverse effect on the Original Members, in the case of clauses (i) and (ii); provided that, no consent from the Original Member Representative is required in order to either pay Tax at make an election under Section 6226(a) of the Code with respect to taxable periods that began on or before the Closing.
(d) All expenses incurred by the Partnership Representative or Designated Individual or Original Member Representative in connection with its duties as partnership representative or designated individual or Original Member Representative, as applicable, shall be expenses of the Company level (including, for the avoidance of doubt, any costs and expenses incurred in connection with any claims asserted against the Partnership Representative or to elect to pass the adjustment through Designated Individual or Original Member Representative, as applicable, except to the Members (a “Push-Out Election”extent the Partnership Representative or Designated Individual is determined to have performed its duties in the manner described in the final sentence of this Section 5.08(d)), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, and the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, reimburse and each such Member shall take such adjusted items into account as required under indemnify the Partnership Audit Rules Representative or Designated Individual or Original Member Representative, as applicable, for all such expenses and costs. Nothing herein shall be construed to restrict the Partnership Representative or Designated Individual or Original Member Representative from engaging lawyers, accountants, tax advisers, or other professional advisers or experts to assist the Partnership Representative or Designated Individual or Original Member Representative in discharging its duties hereunder. Neither the Partnership Representative nor Designated Individual nor Original Member Representative shall be liable to the Company, any Member or any Affiliate thereof for any related interestcosts or losses to any Persons, penalty, addition to Tax, any diminution in value or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company liability whatsoever arising as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay performance of its duties pursuant to this Section 8.2(b) by the deadline established by the Board: 5.08 absent (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; willful breach of any provision of this Section 5.08 or (ii) bad faith, fraud, gross negligence or willful misconduct on the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result part of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code Designated Individual or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Original Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)applicable.
(e) Notwithstanding any other provision of this AgreementThe Company, (i) any Person who ceases the Partnership Representative, and the Members expressly agree to be a Member shall be treated as a Member for purposes bound by the terms of this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution of the Company.7.3
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Partnership Representative. Unless otherwise (a) The General Partner or its designee will be the “partnership representative” of the Partnership within the meaning of Section 6223 of the Code (the “Partnership Representative”). With respect to any period in which any non-individual is the Partnership Representative, the General Partner shall cause the Partnership to appoint an individual eligible to be a “designated individual” under the Audit Rules (the “Designated Individual”) through whom the Partnership Representative will act for all purposes of the Audit Rules. The General Partner is hereby authorized to take any actions necessary under the Audit Rules or other guidance to designate the Partnership Representative and appoint the Designated Individual with respect to each taxable year of the Partnership (and the Partnership Representative and the Designated Individual are authorized to take any actions specified under the Audit Rules or any applicable state statute or local law), and the Partnership shall comply with any requirements necessary to effect such designations and appointments.
(b) The Partnership Representative and the Designated Individual (collectively, the “Tax Representative”), along with the General Partner, shall use their commercially reasonable efforts to minimize the likelihood that any Partner would bear any material tax, interest, or penalties as a result of any audit or proceeding that is attributable to another Partner (other than a predecessor in interest). In furtherance thereof, the General Partner and Tax Representative are hereby authorized to take any action required to cause the financial burden of any “imputed underpayment” (as determined under Section 6225 of the Code) and associated interest, adjustments to tax and penalties arising from a partnership-level adjustment that are imposed on the Partnership (an “Imputed Underpayment”) to be borne by the Partners to whom such Imputed Underpayment relates as determined by the BoardTax Representative after consulting with the Partnership’s accountants or other advisers, taking into account any differences in the amount of taxes attributable to each Partner because of such Partner’s status, nationality or other characteristics. By executing this Agreement or a counterpart hereof, each Partner (A) expressly authorizes the Tax Representative and the Partnership to take any and all action that is reasonably necessary under applicable federal income tax law (as such law may be revised from time to time) to cause the Partnership to make the election set forth in Section 6226(a) of the Code if the Tax Representative decides to make such election, and (B) expressly agrees to take any action, and furnish the Tax Representative with any information necessary, to give effect to such election. Each Partner hereby severally indemnifies and holds the Partnership, the Manager is hereby designated General Partner and the Tax Representative harmless for such Partner’s respective portion of the financial burden of an Imputed Underpayment and in furtherance thereof, each Partner agrees (i) to pay such amount to the Partnership Representative within fifteen (15) days following the General Partner’s request for payment (and any failure to pay such amount shall result in interest on such amount calculated at the prime rate plus two percent (2%)) and (ii) that any amounts otherwise distributable to such Partner may be applied in satisfaction of such obligations. Except with the express written consent of the Company General Partner, each Partner shall be jointly and its Subsidiariesseverally liable with their predecessors in interest, if any, for amounts owed hereunder in respect of any predecessor in interest to such Partner. No Partner shall file a notice with the IRS under Section 6222( c)(1)(B) of the Code in connection with such Partner’s intention to treat an item on such Partner’s Federal income tax return in a manner that is inconsistent with the treatment of such item on the Partnership’s Federal income tax return unless such Partner has, not less than thirty (30) days prior to the filing of such notice, provided the Partnership with a copy of the notice and thereafter in a timely manner provides such other information related thereto as the Tax Representative shall reasonably request.
(c) The Tax Representative shall employ experienced tax counsel to represent the Partnership in connection with any audit or investigation of the Partnership by the IRS and in connection with all subsequent administrative and judicial proceedings arising out of such audit. The fees and expenses of such, and is hereby directed all expenses incurred by the Tax Representative in serving as such, shall be Partnership expenses pursuant to Section 5.2 and authorized shall be paid by the Partnership. Notwithstanding the foregoing, it shall be the responsibility of the General Partner and of each Limited Partner, at their expense, to take whatever steps itemploy tax counsel to represent their respective separate interests.
(d) If the Tax Representative incurs fees and expenses in connection with tax matters not affecting each of the Partners, then the Tax Representative may, in its reasonable discretion, deems necessary seek reimbursement from or desirable to perfect charge such designation, including filing any forms or documents with the IRS or any other Taxing Authority, taking such other action as may from time to time be required under the Treasury Regulations fees and directing the Board to take or approve any of the foregoing actions. If a Designated Individual is required to be appointed under the Partnership Audit Rules, the Partnership Representative shall designate the individual to serve as the Designated Individual and such Designated Individual shall be subject to replacement by the Partnership Representative in accordance with the Code and the Treasury Regulations. Any Person that the Partnership Representative designates to interact with the IRS or any other Taxing Authority shall be treated as, and subject expenses to the requirements Capital Accounts of those Partners on whose behalf such fees and obligations of, the Partnership Representative for purposes of this Section 8.2. Each Member shall use reasonable efforts to take all actions required to cause such designations to be effective under the Partnership Audit Rules.
(a) Subject to Section 6.1, the Partnership Representative shall be authorized to manage any audit, examination or other administrative or judicial proceeding relating to any Tax matters of the Company and its Subsidiaries; provided, that the Partnership Representative shall (i) diligently conduct any such proceedings in good faith, (ii) promptly notify each Member in writing (1) of the commencement of any tax audit, examination, or other administrative or judicial proceeding and (2) upon the receipt of a notice of final partnership administrative adjustment or final partnership adjustment, (iii) keep each Member reasonably informed of the progress of any audits, examinations or other administrative or judicial proceedings, (iv) consult with the GATX Member and the Blocker Member in connection with any audits, examinations or other administrative or judicial proceedings about strategy and give such Members the opportunity (at the sole cost and expense of such Members) to attend any scheduled meetings with the Taxing Authority in such audit, examination, or other administrative or judicial proceeding, (v) provide each Member with a reasonable opportunity to comment on material written submissions to any Taxing Authority and consider, in good faith, any reasonable comments on such written submissions. Notwithstanding any contrary provisions in this Agreement, to the extent any action or intentional omission by the Partnership Representative in its capacity as a “partnership representative” within the meaning of Section 6223(a) of the Code could reasonably be expected to result in a materially adverse impact on the GATX Member or the Blocker Member (or its Affiliates), then the prior written consent of the GATX Member or the Blocker Member, as applicable, shall be required (which consent shall not be unreasonably withheld, conditioned or delayed).
(b) If the IRS adjusts any items of Company taxable income, gain, loss, deduction or credit for a given year (a “Review Year”), and if the Company is permitted under Section 6226(a) of the Code and Treasury Regulations to either pay Tax at the Company level or to elect to pass the adjustment through to the Members (a “Push-Out Election”), the Board shall determine whether to make a Push-Out Election. If such a Push-Out Election is made, the Company shall furnish to each Member a statement reflecting the Member’s share of the adjusted items as determined in the written notice of final partnership adjustment, and each such Member shall take such adjusted items into account as required under the Partnership Audit Rules and shall be liable for any related interest, penalty, addition to Tax, or additional amounts. Any Member that fails to take such adjusted items into account as required by the immediately preceding sentence shall indemnify and hold harmless the Company against any Tax collected by any Taxing Authority from the Company as a result of the Member’s failure. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(b) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(c) In any case where an adjustment of Company taxable income, gain, loss, deduction or credit for a Review Year results in the payment of Tax by the Company (because no Push-Out Election was made or because no Push-Out Election was available), it is intended that the Members shall bear the economic responsibility for the payment of the Tax, penalty and interest paid by the Company in proportion to the manner in which such adjustments made by the IRS or other Taxing Authority would have been allocated to the Members based on their interests in the Company in the Review Year. If the Partnership Representative does not make a Push-Out Election for any reason, and the Company is held directly liable for any additional income Tax, interest, penalty or additional amounts under the Code or other applicable Law as a result of an adjustment to any of the Company’s U.S. federal, state or local Income Tax Returns, each Member shall be required, upon thirty (30) days written demand from the Partnership Representative, to pay the Company its share (as reasonably determined by a certified public accountant engaged by the Partnership Representative on behalf of the Company) of any additional Tax, interest, penalty and additional amounts due (taking into account the effect of any Pull-In Election made by any Member pursuant to Section 8.2(d)). If a Person who was a Member of the Company in the Review Year has withdrawn from the Company, such former Member shall remain obligated to indemnify the Company and the other Members for such former Member’s proportionate share of the Tax, penalties and interest paid by the Company with respect to the Review Year. In the event a Member (or former Member) fails to pay any amount it is obligated to pay pursuant to this Section 8.2(c) by the deadline established by the Board: (i) the unpaid amount shall accrue interest at a rate reasonably determined by the Board; (ii) the Board may reduce subsequent distributions to such Member by such amount; and (iii) such Member (or former Member) shall be liable to the Company for any costs and damages incurred as a result of the delay in payment (without regard to whether the Company could have mitigated any such costs or damages).
(d) The Partnership Representative shall permit all Members who elect in writing to participate in the “pull-in” procedure under Section 6225(c)(2)(B) of the Code and Treasury Regulations thereunder (a “Pull-In Election”). Any Member may participate, and no Member shall be obligated to participate, in any such Pull-In Election. Any economic benefit or burden associated with participating in such procedure will inure to the benefit of or be borne by each Member participating in the procedure to the extent attributable to such Member. No Person shall have the right to require any Member to amend a Tax Return pursuant to Section 6225(c)(2) of the Code nor prevent any Member from doing so, and the Partnership Representative shall take all actions reasonably necessary to effectuate any determination of any Member pursuant to this Section 8.2(d)expenses were incurred.
(e) Notwithstanding any other provision of References in this Agreement, (i) any Person who ceases Section 10.15 to be a Member “Partner” or “Partners” shall be treated as deemed to refer to a Member for purposes of Partner or Partners, a former Partner or former Partners, and to an assignee or assignees. The provisions contained in this Section 8.2 and (ii) the obligations of a Member pursuant to this Section 8.2 10.15 shall survive any redemption or Transfer of a Membership Interest and the termination of this Agreement or the dissolution Partnership and the withdrawal of the Companyany Partner.
Appears in 1 contract
Sources: Limited Partnership Agreement