Common use of Eligible Independent Contractor Clause in Contracts

Eligible Independent Contractor. a) Manager hereby represents and warrants that, as of the Effective Date, Manager satisfies the requirements and conditions of being an Eligible Independent Contractor. b) Manager hereby covenants that, at all times during the Operating Term, it shall maintain its status as an Eligible Independent Contractor and shall not do, or omit to do, anything that would cause Manager to no longer meet the requirements of being an Eligible Independent Contractor. c) Within five (5) business days of Owner’s request, Manager shall deliver to Owner a certificate, executed by an executive officer of Manager, addressed to the NorthStar REIT and, and in the form attached hereto as Schedule E, confirming that either (i) Manager is, and has at all times from and after the date of this Agreement been, in compliance with the terms of this Section 2.4, (ii) Manager is in compliance with the terms of this Section 2.4 and has timely cured any past failure to comply with the terms of this Section 2.4, or (iii) Manager is using commercially reasonable efforts to cure any failure to comply with the terms of this Section 2.4. d) If there shall be an amendment or modification to Section 856(d)(9) of the Code after the date of this Agreement that adversely impacts Manager’s qualification as an Eligible Independent Contractor under the Code, Manager shall cooperate reasonably with Owner, the NorthStar REIT and their respective Affiliates and shall exercise reasonable efforts to effectuate solutions or “workarounds” to address any REIT qualification concerns under the Code of the NorthStar REIT and its Affiliates arising out of any such amendment or modification; provided that (i) to the extent reasonably practicable, any such changes shall be structured so as to not have any negative impact on Manager in any material respect, and (ii) Owner shall bear one hundred percent (100%) of the cost (including legal fees for Manager) in connection with the negotiation and documentation of any such amendments or modifications. e) Manager shall notify Owner within five (5) business days of any matter, event, transaction or other circumstance that, to Manager’s knowledge, could reasonably be expected to (i) violate the terms of this Section 2.4 and (ii) jeopardize or threaten the qualification or status or legal compliance with any government regulations relating to the operation or qualification as a real estate investment trust for United States federal tax purposes, of the NorthStar REIT or its Affiliates (either presently or with the passage of time) or both. f) Manager acknowledges that Owner, the NorthStar REIT and/or their respective Affiliates may suffer immediate and irreparable harm in the event of any breach by Manager of any of its obligations contained in this Section 2.4. Accordingly, Owner, as its sole and exclusive remedy in the event of a breach of this Section 2.4 shall be entitled to terminate this Agreement in accordance with Section 4.1(g)(iii); provided, however, that (i) Manager shall be permitted to cure any such breach of this Section 2.4 (so long as Manager is pursuing such cure with reasonable diligence) unless Owner determines that the REIT status of NorthStar REIT is, or is at such time reasonably likely to be, impaired by such breach (and accordingly, Owner shall not be permitted to enforce its termination right unless Owner determines that the REIT status of NorthStar REIT is, or at such time is reasonably likely to be, impaired by such breach); and (ii) the restriction on Owner’s remedies set forth in this Section 2.4(f) shall not apply with respect to (A) a breach of Section 2.4(a) or (B) a breach of any other provision of this Section 2.4 which also constitutes a breach under any provision of Section 4.1(d) (other than clause (ii) thereof).