Tax Adjustments. If legislation is enacted or the official interpretation of existing legislation is modified by a governmental authority, which after giving effect to such enactment or modification, results in a Company Group Member becoming subject to federal, state or local or non-U.S. income or withholding taxes in excess of the amount of such taxes due from the Company Group Member prior to such enactment or modification (including, for the avoidance of doubt, any increase in the rate of such taxation applicable to the Company Group Member), then the holders of a majority in interest of the IDRs may request the Independent Conflicts Committee to consider the appropriateness of adjusting the Target Distribution, and upon the approval of the Independent Conflicts Committee, the Managing Member may reduce the Target Distributions by the amount of income or withholding taxes that are payable by reason of any such new legislation or interpretation (the “Incremental Income Taxes”), or any portion thereof selected by the Managing Member, in the manner provided in this Section 4.6. If the Managing Member elects to reduce the Target Distributions for any Quarter with respect to all or a portion of any Incremental Income Taxes for such Quarter, the Managing Member shall estimate for such Quarter the Company Group’s aggregate liability (the “Estimated Incremental Quarterly Tax Amount”) for all (or the relevant portion of) such Incremental Income Taxes. For each Quarter in which the Managing Member elects, pursuant to this Section 4.6, to reduce the Target Distributions, the adjusted Target Distribution Amount shall be the amount obtained by multiplying (a) the Target Distribution amount determined prior to the application of this Section 4.6 times (b) the quotient obtained by dividing (i) CAFD with respect to such Quarter by (ii) the sum of CAFD plus the Estimated Incremental Quarterly Tax Amount for such Quarter (as determined by the Managing Member). To the extent the Estimated Incremental Quarterly Tax Amount for a given Quarter differs from the actual liability for Incremental Income Taxes (or the relevant portion thereof) for such Quarter, the Managing Member may, to the extent determined by the Managing Member, take such differences into account in distributions with respect to subsequent Quarters.
Appears in 4 contracts
Samples: Limited Liability Company Agreement (Terraform Global, Inc.), Limited Liability Company Agreement (Terraform Global, Inc.), Limited Liability Company Agreement (TerraForm Power, Inc.)
Tax Adjustments. If legislation is enacted or the official interpretation of existing legislation is modified by a governmental authority, which after giving effect to such enactment or modification, results in a Company Group Member becoming subject to federal, state or local or non-U.S. income or withholding taxes in excess of the amount of such taxes due from the Company Group Member prior to such enactment or modification (including, for the avoidance of doubt, any increase in the rate of such taxation applicable to the Company Group Member), then the holders of a majority in interest of the IDRs may request the Independent Conflicts Committee to consider the appropriateness of adjusting the Target Distribution, and upon the approval of the Independent Conflicts Committee, the Managing Member may reduce the Target Distributions by the amount of income or withholding taxes that are payable by reason of any such new legislation or interpretation (the “Incremental Income Taxes”), or any portion thereof selected by the Managing Member, in the manner provided in this Section 4.6. If the Managing Member elects to reduce the Target Distributions for any Quarter with respect to all or a portion of any Incremental Income Taxes for such Quarter, the Managing Member shall estimate for such Quarter the Company Group’s aggregate liability (the “Estimated Incremental Quarterly Tax Amount”) for all (or the relevant portion of) such Incremental Income Taxes. For each Quarter in which the Managing Member elects, pursuant to this Section 4.6, to reduce the Target Distributions, the adjusted Target Distribution Amount shall be the amount obtained by multiplying (a) the Target Distribution amount determined prior to the application of this Section 4.6 times (b) the quotient obtained by dividing (i) CAFD with respect to such Quarter by (ii) the sum of CAFD plus the Estimated Incremental Quarterly Tax Amount for such Quarter (as determined by the Managing Member). To the extent the Estimated Incremental Quarterly Tax Amount for a given Quarter differs from the actual liability for Incremental Income Taxes (or the relevant portion thereof) for such Quarter, the Managing Member may, to the extent determined by the Managing Member, take such differences into account in distributions with respect to subsequent Quarters.
Appears in 3 contracts
Samples: Limited Liability Company Agreement (TerraForm Power, Inc.), Limited Liability Company Agreement (TerraForm Power, Inc.), Merger and Sponsorship Transaction Agreement (TerraForm Power, Inc.)
