Common use of Characterization as Profits Interests Clause in Contracts

Characterization as Profits Interests. The parties intend to characterize the Incentive Units issued hereunder as “profits interests” within the meaning of Revenue Procedures 93-27 (1993-2 C.B. 343) and 2001-43 (2001-2 C.B. 191). Prior to or after the issuance of the Incentive Units pursuant to this Unit Agreement, the Grantee shall execute and deliver to the IRS an election under Section 83(b) of the Code in substantially the form attached hereto as Exhibit 1 with respect to the Incentive Units (together, the “83(b) Elections”) on a protective basis. The Grantee understands that (i) in making the 83(b) Elections, the Grantee may be taxed at the time the Incentive Units are received hereunder to the extent the Fair Market Value of the Incentive Units exceeds the price for such Incentive Units and (ii) in order to be effective, the 83(b) Elections must be filed with the IRS within thirty (30) days after the Date of Grant. The Grantee hereby acknowledges that: (x) the foregoing description of the tax consequences of the 83(b) Elections is not intended to be complete and, among other things, does not describe state, local or foreign income and other tax consequences; (y) none of the Company, Holdings, NM Members, any of their respective Affiliates or any of their respective partners, members, equityholders, directors, officers, employees, agents or representatives (each, a “Related Person”) has provided or is providing the Grantee with tax advice regarding the 83(b) Elections or any other matter, and the Company, Holdings and the NM Members and their respective Affiliates have urged the Grantee to consult the Grantee’s own tax advisor with respect to income taxation consequences of receiving, holding and disposing of the Incentive Units; and (z) none of the Company, Holdings, NM Members or any other Related Person has advised the Grantee to rely on any determination by it or its representatives as to the Fair Market Value specified in the 83(b) Elections and will have no liability to the Grantee if the actual Fair Market Value of the Incentive Units on the date hereof exceeds the amount specified in the respective 83(b) Elections.

Characterization as Profits Interests. The parties intend to characterize the Corresponding Chloe Units and the Incentive Units issued hereunder as “profits interests” within the meaning of Revenue Procedures 93-27 (1993-2 C.B. 343) and 2001-43 (2001-2 C.B. 191). Prior to or after the issuance of the Corresponding Chloe Units and the Incentive Units pursuant to this Unit Agreement, the Grantee and Chloe shall each execute and deliver to the Internal Revenue Service (the “IRS”) an election under Section 83(b) of the Code in the form attached hereto as Exhibit 2 with respect to the Corresponding Chloe Units and Grantee shall execute and deliver to the IRS an election under Section 83(b) of the Code in substantially the form attached hereto as Exhibit 1 2 with respect to the Incentive Units (together, together the “83(b) Elections”) on a protective basis. The Grantee understands that under Section 83(b) of the Code, regulations promulgated thereunder, and certain IRS administrative announcements, in the absence of an effective election under Section 83(b) of the Code, the excess of the Fair Market Value of any Corresponding Chloe Units or Incentive Units, on the date on which any forfeiture restrictions applicable to such Corresponding Chloe Units or Incentive Units lapse, over the price paid for such Corresponding Chloe Units or Incentive Units, could be reportable as ordinary income at that time. For this purpose, the term “forfeiture restrictions” includes the restrictions on transferability and the vesting and reversion conditions imposed under Section 2. The Grantee understands that (i) in making the 83(b) Elections, the Grantee may be taxed at the time the Corresponding Chloe Units and Incentive Units are received hereunder to the extent the Fair Market Value of the Corresponding Chloe Units or Incentive Units exceeds the price for such Corresponding Chloe Units or Incentive Units and (ii) in order to be effective, the 83(b) Elections must be filed with the IRS within thirty (30) days after the Date of Grant. The Grantee hereby acknowledges that: (x) the foregoing description of the tax consequences of the 83(b) Elections is not intended to be complete and, among other things, does not describe state, local or foreign income and other tax consequences; (y) none of the Company, HoldingsChloe, NM Members, any of their respective Affiliates or any of their respective partners, members, equityholders, directors, officers, employees, agents or representatives (each, a “Related Person”) has provided or is providing the Grantee with tax advice regarding the 83(b) Elections or any other matter, and the Company, Holdings Chloe and the NM Members and their respective Affiliates have urged the Grantee to consult the Grantee’s own tax advisor with respect to income taxation consequences of receiving, holding and disposing of the Corresponding Chloe Units and the Incentive Units; and (z) none of the Company, HoldingsChloe, NM Members or any other Related Person has advised the Grantee to rely on any determination by it or its representatives as to the Fair Market Value specified in the 83(b) Elections and will have no liability to the Grantee if the actual Fair Market Value of the Corresponding Chloe Units or the Incentive Units on the date hereof exceeds the amount specified in the respective 83(b) Elections.

Characterization as Profits Interests. The parties intend to characterize the Corresponding Chloe Units and the Incentive Units issued hereunder as “profits interests” within the meaning of Revenue Procedures 93-27 (1993-2 C.B. 343) and 2001-43 (2001-2 C.B. 191). Prior to or after After the issuance of the Corresponding Chloe Units and the Incentive Units pursuant to this Unit Agreement, the Grantee shall execute and deliver to the Internal Revenue Service (the “IRS”) an election under Section 83(b) of the Code in the form attached hereto as Exhibit 1 with respect to the Corresponding Chloe Units and Grantee shall execute and deliver to the IRS an election under Section 83(b) of the Code in substantially the form attached hereto as Exhibit 1 with respect to the Incentive Units (together, together the “83(b) Elections”). The Grantee understands that under Section 83(b) of the Code, regulations promulgated thereunder, and certain IRS administrative announcements, in the absence of an effective election under Section 83(b) of the Code, the excess of the Fair Market Value of any Corresponding Chloe Units or Incentive Units, on a protective basisthe date on which any forfeiture restrictions applicable to such Corresponding Chloe Units or Incentive Units lapse, over the price paid for such Corresponding Chloe Units or Incentive Units, could be reportable as ordinary income at that time. For this purpose, the term “forfeiture restrictions” includes the restrictions on transferability and the vesting and reversion conditions imposed under Section 2 of the Supplemental Provisions and Section 2 of this Terms Agreement. The Grantee understands that (i) in making the 83(b) Elections, the Grantee may be taxed at the time the Corresponding Chloe Units and Incentive Units are received hereunder to the extent the Fair Market Value of the Corresponding Chloe Units or Incentive Units exceeds the price for such Corresponding Chloe Units or Incentive Units and (ii) in order to be effective, the 83(b) Elections must be filed with the IRS within thirty (30) days after the Date of Grant. The Grantee hereby acknowledges that: (x) the foregoing description of the tax consequences of the 83(b) Elections is not intended to be complete and, among other things, does not describe state, local or foreign income and other tax consequences; (y) none of the Company, HoldingsChloe, NM Members, any of their respective Affiliates or any of their respective partners, members, equityholders, directors, officers, employees, agents or representatives (each, a “Related Person”) has provided or is providing the Grantee with tax advice regarding the 83(b) Elections or any other matter, and the Company, Holdings Chloe and the NM Members and their respective Affiliates have urged the Grantee to consult the Grantee’s own tax advisor with respect to income taxation consequences of receiving, holding and disposing of the Corresponding Chloe Units and the Incentive Units; and (z) none of the Company, HoldingsChloe, NM Members or any other Related Person has advised the Grantee to rely on any determination by it or its representatives as to the Fair Market Value specified in the 83(b) Elections and will have no liability to the Grantee if the actual Fair Market Value of the Corresponding Chloe Units or the Incentive Units on the date hereof exceeds the amount specified in the respective 83(b) Elections.