Common use of REIT Protections Clause in Contracts

REIT Protections. (a) DevCo acknowledges that certain SpinCo Affiliates (each, a “SpinCo REIT”) have elected to be classified as real estate investment trusts (“REITs”) and, as a result, must comply with certain requirements, including, without limitation, the provisions of Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”) (the “REIT Requirements”). In the event that counsel or independent accountants for any SpinCo REIT determine that there exists a material risk that any amounts due to SpinCo or any SpinCo Affiliate pursuant to this Agreement would be treated as gross income not described in Section 856(c)(2) or 856(c)(3) of the Code (“Nonqualifying Income”), the amount paid to SpinCo or any SpinCo Affiliate under this Agreement in any tax year may not exceed the maximum amount that can be paid to SpinCo or the applicable SpinCo Affiliate in such year without causing any SpinCo REIT to fail to meet the REIT Requirements for such year, determined as if the payment of such amount were Nonqualifying Income. If the amount payable for any tax year under the preceding sentence is less than the amount that DevCo or its Affiliates would otherwise be obligated to pay to SpinCo pursuant to the Agreement (the “SpinCo Excess Amount”), then DevCo or the applicable DevCo Affiliate shall place the SpinCo Excess Amount in escrow and shall not release any portion thereof to SpinCo or the applicable SpinCo Affiliate, and neither SpinCo nor such Affiliate shall be entitled to any such amount, unless and until SpinCo or its Affiliate delivers to DevCo or its Affiliate at the sole option of the applicable SpinCo REIT, (A) notice that it has received advice of such SpinCo REIT’s tax counsel to the effect that such amount, if and to the extent paid, would not constitute Nonqualifying Income, (B) a letter from the independent accountants of such SpinCo REIT indicating the maximum amount that can be paid at that time to SpinCo or the SpinCo Affiliate without causing such SpinCo REIT to fail to meet the REIT Requirements for any relevant taxable year, in which case such maximum amount shall be paid to SpinCo or the applicable SpinCo Affiliate, or (C) a private letter ruling issued by the Internal Revenue Service to the applicable SpinCo REIT indicating that the receipt of any SpinCo Excess Amount hereunder would not cause such SpinCo REIT to fail to satisfy the REIT Requirements. The obligation to pay any amount which is not paid as a result of this provision shall terminate five years from the original date such amount would have been payable without regard to this provision and neither SpinCo nor any SpinCo Affiliate shall have any further right to receive any such amount.

REIT Protections. (ai) DevCo acknowledges that certain SpinCo AIR Affiliates (each, a an “SpinCo AIR REIT”) have elected to be classified as real estate investment trusts (“REITs”) and, as a result, must comply with certain requirements, including, without limitation, the provisions of Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”) (such requirements, the “REIT Requirements”). In the event that counsel or independent accountants for any SpinCo AIR REIT determine that there exists a material risk that any amounts due to SpinCo AIR or any SpinCo AIR Affiliate pursuant to this Agreement hereunder, or under any Master Lease, would be treated as gross income not described in Section 856(c)(2) or 856(c)(3) of the Code (“Nonqualifying Income”), the amount paid to SpinCo AIR or any SpinCo the applicable AIR Affiliate under this Agreement or the applicable Master Lease in any tax year may not exceed the maximum amount that can be paid to SpinCo AIR or the applicable SpinCo AIR Affiliate in such year without causing any SpinCo AIR REIT to fail to meet the REIT Requirements for such year, determined as if the payment of such amount were Nonqualifying Income. If the amount payable for any tax year under the preceding sentence is less than the amount that DevCo or its Affiliates would otherwise be obligated to pay to SpinCo AIR or an AIR Affiliate pursuant to this Agreement or the Agreement applicable Master Lease, as applicable (the “SpinCo AIR Excess Amount”), then DevCo or the applicable DevCo Affiliate shall place the SpinCo AIR Excess Amount in escrow and shall not release any portion thereof to SpinCo AIR or the applicable SpinCo AIR Affiliate, and neither SpinCo AIR nor such Affiliate shall be entitled to any such amount, unless and until SpinCo AIR or its Affiliate delivers to DevCo or its Affiliate at the sole option of the applicable SpinCo AIR REIT, (A) notice that it has received advice of such SpinCo AIR REIT’s tax counsel to the effect that such amount, if and to the extent paid, would not constitute Nonqualifying Income, (B) a letter from the independent accountants of such SpinCo AIR REIT indicating the maximum amount that can be paid at that time to SpinCo AIR or the SpinCo AIR Affiliate without causing such SpinCo AIR REIT to fail to meet the REIT Requirements for any relevant taxable year, in which case such maximum amount shall be paid to SpinCo AIR or the applicable SpinCo AIR Affiliate, or (C) a private letter ruling issued by the Internal Revenue Service to the applicable SpinCo AIR REIT indicating that the receipt of any SpinCo AIR Excess Amount hereunder would not cause such SpinCo AIR REIT to fail to satisfy the REIT Requirements. The obligation to pay any amount which is not paid as a result of this provision shall terminate five years from the original date such amount would have been payable without regard to this provision and neither SpinCo AIR nor any SpinCo AIR Affiliate shall have any further right to receive any such amount.

REIT Protections. (ai) DevCo acknowledges that certain SpinCo AIR Affiliates (each, a an “SpinCo AIR REIT”) have elected to be classified as real estate investment trusts (“REITs”) and, as a result, must comply with certain requirements, including, without limitation, the provisions of Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”) (such requirements, the “REIT Requirements”). In the event that counsel or independent accountants for any SpinCo AIR REIT determine that there exists a material risk that any amounts due to SpinCo AIR or any SpinCo AIR Affiliate pursuant to this Agreement hereunder, or under any Master Lease, would be treated as gross income not described in Section 856(c)(2) or 856(c)(3) of the Code (“Nonqualifying Income”), the amount paid to SpinCo AIR or any SpinCo AIR Affiliate under this Agreement or the applicable Master Lease in any tax year may not exceed the maximum amount that can be paid to SpinCo AIR or the applicable SpinCo AIR Affiliate in such year without causing any SpinCo AIR REIT to fail to meet the REIT Requirements for such year, determined as if the payment of such amount were Nonqualifying Income. If the amount payable for any tax year under the preceding sentence is less than the amount that DevCo or its Affiliates would otherwise be obligated to pay to SpinCo AIR or an AIR Affiliate pursuant to this Agreement or pursuant to the Agreement applicable Master Lease, as applicable (the “SpinCo AIR Excess Amount”), then DevCo or the applicable DevCo Affiliate shall place the SpinCo AIR Excess Amount in escrow and shall not release any portion thereof to SpinCo AIR or the applicable SpinCo AIR Affiliate, and neither SpinCo AIR nor such Affiliate shall be entitled to any such amount, unless and until SpinCo AIR or its Affiliate delivers to DevCo or its Affiliate at the sole option of the applicable SpinCo AIR REIT, (A) notice that it has received advice of such SpinCo AIR REIT’s tax counsel to the effect that such amount, if and to the extent paid, would not constitute Nonqualifying Income, (B) a letter from the independent accountants of such SpinCo AIR REIT indicating the maximum amount that can be paid at that time to SpinCo AIR or the SpinCo AIR Affiliate without causing such SpinCo AIR REIT to fail to meet the REIT Requirements for any relevant taxable year, in which case such maximum amount shall be paid to SpinCo AIR or the applicable SpinCo AIR Affiliate, or (C) a private letter ruling issued by the Internal Revenue Service to the applicable SpinCo AIR REIT indicating that the receipt of any SpinCo AIR Excess Amount hereunder would not cause such SpinCo AIR REIT to fail to satisfy the REIT Requirements. The obligation to pay any amount which is not paid as a result of this provision shall terminate five years from the original date such amount would have been payable without regard to this provision and neither SpinCo AIR nor any SpinCo AIR Affiliate shall have any further right to receive any such amount.